Barges Eye Revival on US West Coast

By Simon West

From Issue 4, 2024 of Breakbulk Magazine.

(5-minute read)


After decades of being undercut by cheap fuel prices and a deregulated trucking market, the use of barges to carry breakbulk and other cargoes up and down the U.S. West Coast could be on the verge of a comeback, with a new intracoastal pilot project slated for start-up by the end of the year.

The Marine Highway 5, or M-5 project, is seeking to replicate U.S. maritime administration Marad’s success of developing ocean-going links between ports on the East Coast and in the Gulf, and would be the first genuine effort to connect the western states of California, Oregon and Washington with a regular domestic cabotage barge system.

The corridor would run parallel to Interstate-5, or I-5, the main north-south freeway on the West Coast, opening up a direct ocean link from the Port of San Diego in southern California to Washington state’s Port of Bellingham a few kilometers south of the U.S.-Canadian border.

“There has yet to be a successful U.S. West Coast barge service on the ocean. But we think the time is right,” said Greg Borossay, principal of maritime business development at the Port of San Diego, one of the sponsors of the M-5 project.

“After Covid, the supply chain crisis really hit the larger ports. Here in San Diego, for instance, we were asked to take two to four additional loaders per month, primarily from LA Long Beach because they couldn’t handle the cargo. And the same went for other medium-sized ports up and down the West Coast. Coming out of that situation, we saw there was a need for better connectivity for North American goods that flow up and down that corridor.”


Emissions Rules Put Pressure on Trucking

The use of barges in the region is hardly a new concept – in the 1970s there was barging “all the time” between certain points along the West Coast, Borossay said. But the deregulation of the trucking and railroad industries starting in the 1980s, cheaper fuels and the buildout of the U.S. road network made trucks a more cost-effective and convenient option.

But the tide is turning again, as stricter emissions rules in California are curtailing the availability of heavy-duty trucks to carry cargo, with the Advanced Clean Trucks (ACT) and Advanced Clean Fleets (ACF) regulations aiming to create a fully zero-emission-vehicle (ZEV) fleet by the mid-2040s.

“ACT is about sales of new trucks, which will be transitioning to electric vehicles (EVs) much like California’s light-duty vehicle sales, though on a slower ramp,” said Mark Jacobsen, an economics professor at the University of California San Diego. “ACF meanwhile includes both new and used trucks and affects companies with over 50 trucks and all drayage trucks, which are required to be zero-emissions by 2035.”

The extent to which these new rules will boost demand for barges and other transport modes depends on “aggregate elasticity of demand,” the professor said. “We would expect switching away from trucks and into other forms of freight transport like rail or ocean barge. The direction is clear, but the magnitude is much less certain. It may be that the switching effects will turn out to be pretty small, or they could be much more significant.”

Borossay estimated that new emissions regulations could result in a third of all trucks in California ceasing to operate or being transferred to other states. The spike in diesel prices, meanwhile, has also knocked the competitiveness of road transport. “A truck move from northern Washington down to San Diego has at least doubled in price, making the barge option much more viable,” he said.


Barge Pilot Takes Shape

According to Borossay, the M-5 line would begin by shipping lumber from Oregon and Washington down to key markets in California. A pilot project carrying raw timber products is slated to start up in late 2024, with a goal of making it a monthly service as soon as feasible. The transport of heavy project cargo could follow in “two to three years,” the executive said.

Building materials suppliers Dixieline Lumber and Boise Cascade would initially be the primary southbound users of the barge, while two large European ocean carriers – unnamed at this stage – are reportedly interested in using the service to ship empty containers back up to the Pacific Northwest.

Matthew Cress, business development manager at the Port of Bellingham, another of the project’s sponsors, told Breakbulk that the project had received request for proposals (RFPs) from five companies interested in running the service. The operator’s duties would include managing bookings, overseeing stowage and working the tugs and barges. 

“We know that to make this really viable, we need to fill the barges – we can’t just have partial cargoes otherwise it will be too expensive for shippers to move, and nobody will want to do the business if they’re not getting a certain return. At the end of the day it’s the operator that needs to make a profit,” Cress said. “So we’re going to start with raw lumber and then continue with cold storage products and any other types of breakbulk or project cargo – steel beams or coils or whatever. Essentially, this is a start-up and we’re looking forward to it succeeding.”


Ports Benefit From Federal Funds

Marad has already approved the project and begun funding infrastructure upgrades at the sponsor ports: San Diego was awarded US$5 million to expand the fendering, laydown area and berthing location for the barges while Bellingham received US$1.7 million to purchase a new portable barge ramp for its Bellingham Shipping Terminal (BST), one of its two facilities – the other being C-Street Terminal – equipped to accommodate barges.

“The barge ramp is being designed and should be constructed by 2025. In the meantime, the port is able to begin this (M-5) service using existing mooring options and our Liebherr LHM 420 mobile harbor crane,” Cress said. “The port’s objective is to increase activity at BST with a multipurpose terminal working barges and cargo vessels.”

One potential drawback to using barges along the West Coast is speed – a trip from San Diego to Bellingham would take eight days, whereas a truck can cover the same ground in about a quarter of the time. But, as lumber often sits in yards for weeks before it is moved on, and empty containers are not carrying cargo, the just-in-time requirements – initially at least – would not be an issue, Borossay said.

“Project cargo would probably be much more time sensitive, but again, projects move very slowly. If you’re talking about offshore wind and those projects that are coming in the next decade or two, I would say yes, there would be tighter timeframes. But hopefully by that time we’ve developed enough of the network so that there are choices and flexibility for customers.

“What we’re hoping is that we’ll be positioned with the barge already functioning for lumber and for containers when the project cargo starts to come along. If we have an established milk run with barges, then it’s not so difficult for an operator to inject a larger barge or a barge that is modified to handle breakbulk. That’s the intent longer term.”


Read more: Capacity Crunch on US Waterways

The Port of San Diego will be exhibiting at Breakbulk Americas 2024 on 15-17 October at the George R. Brown Convention Center in Houston, Texas.

TOP PHOTO: Barge dock at the Port of Bellingham in Washington state. CREDIT: Port of Bellingham