Trade between Asia and the West was so important in ancient times, it had a name: The Silk Road.
The East-West trade that connects the world’s major population centers today is no less important.
Before 2005, Jacksonville wasn’t even a waypoint on those trade routes.
That changed when TraPac opened the first Asian container terminal at the Port of Jacksonville.
The man who led the operation is Dennis Kelly, TraPac regional vice president and general manager of the company’s terminal at JaxPort.
Kelly is the face of global shipping in Jacksonville. Literally. When the port talks of dredging its shipping channel to 47 feet, Kelly is always there, adding his voice to the call.
He began his career nearly 48 years ago as a shipping clerk for Dole Fresh Fruit Co. in Gulfport, Miss. His uncle was a ship’s captain and Kelly had always been intrigued by the industry.
Kelly worked with Dole for 35 years, eventually rising to vice president of the company’s six ports in North America, a position that gained him wide respect in the industry.
Dole managed every part of its fruit business — growing, harvesting, shipping and distributing fruit from Central and South America to the U.S.
It took coordination. Every step was temperature controlled to protect the fruit and shipments had to be processed immediately.
“Once you work in a perpetual supply chain of perishables, everything else after that is pretty easy,” Kelly said.
In the mid to late 1980s, the shipping industry began to change. Dole started using container ships. One container could hold 1,000 boxes of bananas.
By the 1990s, globalization had taken off. Today it’s a way of life.
“It’s changed everything,” Kelly said. “Everything you buy, by and large, is from abroad — furniture, fixtures, food, electronics.”
With globalization, Asia has become the largest growth opportunity for U.S. ports.
In the early 2000s, U.S. trade with Asia was growing by double digits every year. It’s expected to triple overall by 2035.
In the early 2000s, JaxPort’s shipping trade was regional, limited to Puerto Rico and the Caribbean, South America and Latin America.
The port spent years courting Asian shipping companies so it could get in the global game.
“We needed that one company to say, ‘I’m taking that leap of faith,’” said JaxPort Chief Operating Officer Roy Schleicher.
It found that partner in Mitsui OSK Lines, a Tokyo-based global shipper and parent company to TraPac.
The company recruited Kelly away from Dole to build its container terminal at JaxPort. It’s TraPac’s only shipping terminal on the U.S. East Coast.
TraPac saw opportunity in Jacksonville, Kelly said.
The companies that make the products — Lowe’s, Home Depot, Michaels, Coach — are ultimately the ones who decide what routes cargo will take.
But Jacksonville’s three railroads and three interstates leading to Southeast population centers make it a compelling choice.
“It is the most accessible port on the East Coast,” Kelly said.
TraPac opened its terminal at Dames Point in January 2009. Today, it’s one of the port’s largest customers.
The terminal was responsible for 26 percent of JaxPort’s container cargo last year and 85 percent of its trade with Asia.
A drive through TraPac reveals containers with coffee from Vietnam bound for Maxwell House and frozen seafood from Beaver Street Fisheries and Florida citrus awaiting shipment to Asia.
TraPac was key in bringing Bridgestone/Firestone to Cecil Commerce Center and was behind Disney moving its imports from Savannah to JaxPort.
Michaels has expanded its Jacksonville warehouse since the terminal opened and the terminal is likely behind the expansion of Coach as well, said Jerry Mallott, president of JAXUSA Partnership.
“His operation truly changed Jacksonville, because it opened us up to Asia in ways we couldn’t have had otherwise,” he said.
On economic development deals, TraPac is one of JAXUSA’s partners.
“If we’re working with a company that is buying or selling products in Asia, TraPac absolutely makes a difference and we ask Dennis to be involved,” Mallot said.
Mitsui OSK Lines put Jacksonville on the global map, Kelly said. “Everything and anything has become a possibility.”
It not only committed over $300 million to building a container terminal, it also committed to bringing in ships.
Because of TraPac’s lead, three of the world’s four global carrier alliances, representing 11 shipping companies, use JaxPort as a port of call.
But TraPac and the global shippers that followed it need infrastructure — distribution centers and land transport — to go with the ports of call.
“It’s a chicken-and-egg situation,” Schleicher said.
Most of all, they need deep water in JaxPort’s shipping channel. TraPac’s future and the future of global shipping in JaxPort depend on it.
The global carriers share container ships to cut costs. And those ships have grown ever larger — enough now to carry 20,000 containers.
The largest ship to enter TraPac holds 7,500 containers.
Once the Panama Canal expansion is completed this year, 10,000 containers will become the norm, Kelly said.
Those ships will need 45 to 46 feet of water to safely come in to port. Jacksonville’s shipping channel is 40 feet.
Ten years ago when Mitsui OSK Lines was first looking at JaxPort, the hope was everything would fall into place, Kelly said.
As the global recession and the long wait for deep water dragged on, TraPac lost tens of millions of dollars. Today, the company is at a crossroads.
“It’s not a matter of hoping and waiting,” Kelly said. “The fact of the matter is we need more business and deep water is the key to more business.”
The price tag for deep water is $684 million. The federal government, which typically funds two-thirds of the cost of harbor projects, has so yet to authorize the first dollar.
If the problem seems insurmountable, it’s worth looking back at where the port was 10 years ago.
“When I first came to JaxPort, I remember people saying, ‘You’ll never get an Asian carrier here,’” Schleicher said.
They were wrong. Many people hope they always will be.
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