Increased breakbulk imports evidence higher demand for steel and steel-related products.
As commodity markets continually work to recapture revenue decreased by shipping delays and infrastructure bottlenecks, breakbulk imports are currently experiencing an increased demand compared to statistics from a year ago. Among the top of the list of in-demand breakbulk cargo is steel and steel-related products. While steel imports are subject to the same ocean shipping costs and concerns as many other imports, the key factors that set steel apart remain its deep demand and domestic short supply.
Steel Support in South Jersey
At the two terminals it operates in Camden, N.J., the South Jersey Port Corporation (SJPC) exclusively handles breakbulk and bulk imports, with 2024 Q1 import statistics showing an impressive increase when compared to a year ago.
Brendan Dugan, chief commercial officer at SJPC, reported, “Overall, breakbulk cargo has increased 26% from March 2023 to March 2024.” He added, “All cargo tonnage through March 2024 is 880,000T, which is a 10% increase over year-to-date March 2023.”
Among the breakbulk and bulk cargo arriving at the Camden terminals, steel and steel-related products account for 60-65% of imports. The majority of these products – such as steel coils, tin plate coils, structural steel, pipe, and steel plates – arrive in the U.S. by way of a well-established shipping route from Antwerp, Belgium, to Camden, N.J.
Dugan pointed out that other locations in Germany, the Netherlands, and France also export steel and steel-related products to the U.S. East Coast, along with various other countries including Korea, Turkey, Japan, and Taiwan.
In addition to its two terminals in Camden, the SJPC also owns and leases a third terminal located in Paulsboro, N.J., where products such as steel slats are imported. In the past, Russia and Ukraine were the origination points for steel imported to Paulsboro; however, geopolitical issues created a decrease in the volume of steel imports. As such, resourcing of steel is now focused on new export countries such as Brazil and Australia, while imports from South Korea remain stable.
“When we look at total imports of steel and steel-related products at all three terminals, the change between Q1 of 2023 and Q1 of 2024 is an increase of 37%,” noted Dugan.
Master Plan Steels Terminal Expansions
While the SJPC welcomes the increase in steel imports, they also realize that with the additional cargo arrivals comes a need for increased space to accommodate product storage. With this in mind, the SJPC is addressing the issue with a master plan process. The innovative master plan is currently in progress and has an estimated completion date by the end of 2024.
Dugan explained, “The master plan is meant to result in expansion of the storage areas at the terminals that are used for indoor and outdoor cargo that comes in. Right now, terminal space demands exceed the available storage space, so the master plan is focused on increasing storage capacity. With the additional space, we’ll be able to increase velocity when bringing in ships and get the cargo into available storage faster.”
Currently, breakbulk and bulk cargo arriving at the Camden terminals is stored for an average of 30 days before being dispatched via truck or rail to locations around the country. Most products are semi-finished goods – such as structural steel, steel coils and tin plate coils – with almost all imports slated for use in residential, commercial, and industrial construction projects.
The goal of the master plan, according to Dugan, is to show a road map for the next 25-30 years with both short- and long-term improvements.
Cargo Concerns and Costs
Among the main concerns affecting ocean shippers is the continued rise in tariffs and the inevitable pass-through of costs when doing business. As many commodity markets look to find innovative ways to address tariffs and stay in the black, the demand for steel and steel-related products is allowing some companies to go beyond the black into financial fields of green.
However, when looking at some of the top concerns of ocean shipping, Dugan commented, “Tariffs are always going to be a major concern for ocean shipping – there’s just no way around that. But with the increase in steel imports, tariffs don’t seem to be as big of a cost concern, so we’re still able to receive the products that are most in demand right now.”
Dugan also pointed out two other top concerns that have had serious impacts on ocean shipping, and reported what is being done as solutions to the problems.
“The low-water levels in the Panama Canal caused back-ups and delays in cargo arrivals. These delays created additional costs that were passed along to the importers, which was unfortunate for everyone. But the water levels are coming back up, which should help eliminate that in the future.”
He continued, “Another serious issue has been the problem of pirates. One of the solutions that’s been put in place is more patrol support for commercial vessels. We all know that pirates are an ongoing security issue, so to have more support for the vessels is definitely a plus for shippers.”
