USDOT announces TIGER 3 Grant Recipients

[mtraininjax]

F500 wood/paper products company

GP?

[thelakelander]

Yes.  Over the last thirty years, the division he worked in has been owned by Owens Illinois, GP, Nekoosa Packaging, and now PCA.  His first job out of school was in the accounting department of the old paper mill (the O-I/Alton Box era) on Talleyrand back during the 60s.  I believe they still have a PCA corrugated box plant out on Eastport Road.

[thelakelander]

Speaking of PCA and what other companies will pay for if it makes them money, the Winter Haven plant is pretty much built out, so to make room for additional manufacturing space, they ended up taking over some space in the former Scotty's distribution center down the street to store tons of liner board.  Needless to say, with all that paper, they ended up burning the entire thing down back in 2008:

http://www.youtube.com/v/IKY7rPGQc5c

Some other logistics company quickly saw a business opportunity and ended up building them a 200,000 square foot warehouse nearby to replace the loss.

With all that said, I guess that plant still has capacity issues.  I just came across an article where another company 20 miles away is going to be receiving and storing 4,000 tons of liner board a month via CSX a month for that one plant (which gets its own box car shipments on a regular basis). 

Plant City, FLâ€" Star Distribution Systems, Inc. announced today that the company has been selected to operate outside storage and transportation services for Packaging Corporation of America’s Winter Haven Combining Plant.  It is anticipated that more than 4,000 tons of liner board per month will be handled via boxcar to provide a JIT inventory to the plant.  Star Distribution was selected based on industry expertise, product handling capabilities and a private fleet transportation solution.

http://www.stardistribution.us/press-room/120-star-distribution-systems-inc-is-utilized-in-pcas-growth-strategy

Now take this one plant and multiple it by 67 and throw in four paper mills, all of which need rail access.  Rail and logistics companies have no problem in investing in infrastructure to keep feeding the beast, which in turn makes more money for all involved.

The company is the fifth-largest producer of container-board and corrugated packaging products in the U.S., with sales of $2.44 billion in 2010, according to PCA's website. Altogether, the firm operates four paper mills and 67 corrugated products plants in 26 states across the country, employing about 8,000 people total.

http://www.theledger.com/article/20110224/NEWS/102245060

Spinning this back to JAXPORT, if the intermodal yard was critical to a rail company's short term success and profitability, they'd pony up cash to make it happen quicker.

[thelakelander]

Seems Norfolk has multiple rail carriers....

For decades, Norfolk Southern Corp. has controlled all but a tiny sliver of the containerized cargo moving to and from the port of Hampton Roads by rail.

That's about to change.

CSX Corp., the nation's third-largest railroad, has signed a national contract with Maersk Line, the world's largest ocean carrier, that will shift the lion's share of rail-cargo operations at APM Terminals Virginia from Norfolk Southern to CSX.

The contract takes effect Jan. 1.

"The premise is more competition at the port and a growing pie," said Ryan D. Houfek, assistant vice president/sales at CSX Transportation, based in Jacksonville, Fla. "It really kind of gets us out of the gate here and makes CSX a real force in the Port of Virginia."

"Today almost all of the cargo that we get that comes via the Panama Canal is local truck cargo that's going within a 300-mile radius of here; there's very little rail," Capozzi said.

That's expected to change with the opening of an expanded Panama Canal in 2014, enabling the transit of container ships more than twice the size of those moving through it now.

Rail is a linchpin of the Port Authority's long-term strategy for growth, enhanced by Hampton Roads' 50-foot channel depth and quick access to the open sea.

The bigger role that CSX soon will play in Hampton Roads will add to the options the port can offer shippers.

"When you have both Class 1 railroads calling at your port, it really helps us," said Joe Harris, a Port Authority spokesman. "When you're dealing with ship lines and customers and potential customers, you want to be able to lay that full menu of offerings in front of them."

full article: http://hamptonroads.com/2011/10/csx-muscles-norfolk-southerns-cargo-business

[thelakelander]

Hmmm, it looks like they might be paying for an intermodal yard to serve Mersk in Virginia as well.  This pretty much confirms my assessment of JAXPORT's intermodal terminal and it's ultimate importance to CSX's bottom line.  With that said, yes, I believe that JAXPORT/COJ should consider outright purchasing the spur to Blount Island and making the port's terminals accessible to multiple carriers.

New Year, New Intermodal Business

Released: December 9, 2011

Major new business with shipping giant Maersk to begin Jan. 1.

CSX’s intermodal team, in coordination with Transportation, has been preparing all year for a major event occurring on Jan. 1, 2012. Maersk Line, the world’s largest ocean container carrier, is shifting nearly its entire eastern inland volume to CSX.

“Winning the Maersk account is an enormous accomplishment for CSX,” said Bill Clement, CSXT vice president-Intermodal.

Maersk made this strategic shift in carrier selection as a result of CSX’s renewed ability to service the company’s needs in Portsmouth, Va., as well as the long-term service reliability that our new Northwest Ohio terminal will deliver. Maersk is dedicated to being the best, most reliable service provider in its industry, and they are expecting CSX to help them accomplish that. The new Maersk volumes will be significant, with traffic flows concentrated between the marine terminals at Portsmouth and New Jersey and the Ohio Valley and Upper Midwest, as well as Charleston and Savannah in the Southeast.

In preparation for their volumes moving over the Virginia port of APM-Portsmouth, CSX is developing new capabilities to serve Maersk directly on the marine terminal (“on-dock rail”) that will be ready by Jan. 1, 2012. New infrastructure currently under construction at Kilby in Suffolk, Va., will enable CSX to merge traffic from our Portsmouth intermodal ramp and the APM marine terminal. Further, a new non-stop train from Chicago to Portsmouth will make Maersk more service competitive than its current route. CSX is also currently building a new intermodal terminal in Louisville, Ky., where we will be able to meet Maersk’s needs as well as grow new business with our other intermodal customers.

The Maersk initiative requires tremendous teamwork, and CSX has proven once again the ‘People Make the Difference’ by completing the transition planning and preparation in less than a year. Both CSX and Maersk are service-demanding companies, and our teams have worked diligently to ensure that we are ready for the January launch.

“Maersk has high expectations that CSX will raise the bar and allow them to be more competitive in the international arena,” said Clement. “CSX’s reputation will be determined in the first months of Maersk’s experience on CSX, so it is critical that we get off to a great start and set the tone for the rest of the year. As we all see Maersk containers comprising a large part of our intermodal trains after Jan. 1, let’s work together to show them that they’ve made the right choice in selecting CSX as their long-term eastern service provider.”

http://www.trainorders.com/discussion/read.php?2,2637030,2637808

Now before anybody gets offended, I'm not saying investing in JAXPORT or the intermodal yard isn't important because they both are.  What I am saying is when the demand comes to justify private investment, companies like CSX will pony up cash if they stand to make a decent profit.  At this point, we're not there yet.  However, giving other carriers access could be enough to get them to contribute cash to make that happen.