River pilots eyeing more container ships, worrisome tariffs

Tariffs on imported steel products, a new container ship port north of Wilmington, and a significantly wider Panama Canal. All three could affect operations of the Pilots Association for the Bay and River Delaware, which has headquarters in Philadelphia and Lewes.

Often called river pilots, members of the association provide navigation services to all the shipping traffic on Delaware River and Bay. Their heritage goes back to the 1700s when Native American predecessors were employed by early European explorers to help captains navigate around shoals in the swift-currented waterways. Pilots, many of whom live in Lewes and Rehoboth Beach, board inbound ships from launches that carry them out into the ocean past the point at Cape Henlopen. Outbound, they board at ports in Delaware, New Jersey and Pennsylvania.

Capt. Jon Kemmerly took over as president of the association in the past year. He said in 2017 the pilots were involved in more than 7,000 ship movements on the bay and river. "We boarded 2,400 ships at the capes - that adds up to 4,800 trips because they all come back again. And the rest involve moving ships between ports and from the lightering operation at Big Stone Beach."

He said a proposal by Gulftainer USA to partner with Delaware for operation of the Port of Wilmington, and to build a new, automated, $410 million container-ship facility at the former DuPont Edgemoor chemical facility on the Delaware River north of Wilmington, would be good for the piloting business and good for Delaware. The Gulftainer Group, according to the company's website, is the largest independent, privately owned port operator in the world. The company operates 15 ports across four continents, including North America.

When Gov. John Carney announced the Gulftainer proposal in late April, he said royalties from joining forces with the company for operation of the Port of Wilmington and the Edgemoor facility, which the state bought a few years back, would bring at least $13 million per year to state coffers and provide hundreds of jobs.

"There are a myriad of groups looking at river development," said Kemmerly. "But this is the most promising since the new Paulsboro, New Jersey terminal came on line a couple of years ago. We work hand in hand with all these groups."

Assembly must approve proposal

Delaware's General Assembly and port operators must still approve the agreement with Gulftainer. "There's some concern because the company is based in the United Arab Emirates," said Kemmerly. But, he said, that's further evidence of the increasingly global community we all live in. The pilots deal with ships, captains and crew members from all over the world. "That's our lives every day out on the river."

Kemmerly said container ship traffic, which Gulftainer says would increase significantly if its proposal is approved, represents an increasing percentage of ship traffic. "It's the future on the river," he said.

Kemmerly said there is an under-capacity situation up and down the East Coast. "The main macro trend I see is the need to get more facilities for containers. The biggest knock to the port of New York City is the congestion of the city. It's tough to get containers out of New York. That's a big selling point for the ports of Philly and New Jersey. We have an accessible rail and highway system with much less congestion. Gulftainer sees that opportunity here."

More container ships may eventually drive the need for more pilots and associated employees but Kemmerly doesn't see that happening right away. "Ships are getting larger but there's still only one pilot per ship. The increased tonnage of cargo might at one time have meant 10 more smaller ships. But now that's one more larger ship."

As ships have grown, the pilots have actually reduced their numbers. "We have about 30 fewer pilots than we had in the '60s and '70s when our numbers were up in the 90s. We have some new pilots in the pipeline right now, but it takes 10 years for a pilot to go from apprentice to full license for all ships."

He said the Panama Canal widening project completed a few years ago has increased the size of container and other ships.

The canal's dimensions previously limited ships to 106 feet at their beam by 800 or so feet of length. The new Panama Canal accommodates ships with beams of 161 feet and lengths of 1,200 feet. "We had a ship leave this week, the Shuba B, that is 1,038 feet long with a beam of 158 feet. The larger container ships we're seeing are a direct result of the canal widening."

When a dredging project deepening the Delaware River and Bay's channel system to 45 feet is completed in 2019, that will also add to the attractiveness of ports on the river.

Steel tariffs large concern

While those are good signs for business, Kemmerly said there is concern about the potential impact of the Trump administration's tariffs on imported steel.

"We handle a lot of steel on ships. The tariffs could absolutely affect us because of less product coming in," said Kemmerly. "The folks on the river who haul steel are actively involved in fighting the tariffs."

Kemmerly said the pilots navigated at least 200 ships last year bringing imported steel into the country.

But the overarching concern for the pilots, in navigating the thousands of ships they do each year, Kemmerly said, is to do it safely for the environment, the ships and their crews. "We're constantly aware of how many large ships we're moving that close to the bottom and in close proximity to other ships. That's our whole lives. That's what we've trained for. With globalization and bigger ships, it's an exciting time to be doing this job. I can't imagine doing anything else. All I ever think about is that river."