Alabama Ports Get an Overhaul to Make Them More Container-Friendly

As the completion of the Panama Canal expansion project draws nearer, American ports in the Gulf of Mexico are planning their own expansion, in order to be ready to handle the greater flow of goods that is expected. One major port that is due for an overhaul is Mobile in Alabama, which has plans for $412 million in new projects and expansions on the table. While the expected increase in cargo that is expected from the expansion of the Panama Canal is a part of the motivation, increases in local manufacturing and an improvement in the S&P rating for the port have also done a lot to restore confidence in Mobile as a potential freight hub. In May, S&P upgraded the rating of the Alabama State Port Authority to ‘A,’ in response to the development of port facilities and increased revenues in the past year. While S&P have conceded that the port authority’s margins do remain low for their A rating, the expectation of robust performance in the future indicates that they will continue to build on their revenues, and increase their margins in the coming years. Currently, the Port of Mobile is estimated to contribute $22.3 billion to Alabama’s economy, making the development of port facilities a part of a wider investment in the prosperity of the state. A part of the expansion of the facilities in Mobile is the direct result of the need to have a modern terminal for the growing steel export trade through the Gulf. This has already seen $36 million being invested in a new steel-handling facility, but the larger expansion project aims at increasing the number of containers that move through the port, by improving the intermodal freight handling capabilities of the port. This increase in containerized freight is being supported by the development of two new rail links, with a total of $80 million budgeted for improving the local intermodal network and plans to build a link with Birmingham. These developments will be augmented by the $68 million that has been slated for the continued development of the container handling facilities at Mobile, which have already proven to be a great success, generating $144 million in revenues for the Port Authority in 2012. This development seems set to make Mobile one of the major ports in America’s redeveloping intermodal network and, when the Panama Canal project finally begins to deliver on its potential, may see the Gulf port become one of the most viable intermodal hubs in the country.