these cariers handled some 24,500 tons at pier 6 including shoes, cooking oils, marmalade, tile, machinery, tomato paste, and olives. Pier 7, a marginal wharf, is a private pier of 555 feet length which is used to handle corn from Santo Domingo and small motor boats of foreign registry. This pier, like pier 6, is in very poor condition.

Pier 8, a finger pier consisting of three sections, handled about 128,000 tons of foreign and domestic dry cargo in 1967. The 592 foot east berth of pier 8, which is used by SACAL for handling containerized cargo, is structurally weak. Moreover, the adjacent 25,000 feet of open area will accommodate only 35 vans, and, for this reason, container operations are usually congested and inefficient. The 555 foot west side of pier 8, which includes a 175,596 square foot transit shed, is used as a fertilizer plant by Armour Fertilizer Co. on an exclusive use basis. The 409 foot south area of the pier is used by all ships on a first call basis, generally for offloading breakbulk cargo. Foreign ships using this facility include Nordana Line (Spanish), Blue Ribbon Line (Caribbean), Shaw Steamship Co. (Canadian), and Royal Netherlands (Dutch). These carriers offload general breakbulk cargo. In addition, contract carriers including Armour Fertilizer (Guanica) and Bulk Food Carriers call at pier 8 to offload fertilizer and bulk cargo. SACAL-V. I.'s SS Saint Inez which operated to and from the Virgin Islands also used this pier. In 1967, pier 9, a finger pier with sections of 450 to 600 foot lengths, handled only 55,151 tons. This pier, which has a 28 foot concrete apron, was used by Transamerican Steamship Corp. to handle mainly breakbulk traffic including some automobiles from the North Atlantic. In addition, Alcoa calls at this pier from the U.S. Gulf area approximately once each month to offload general breakbulk cargo including piping. Motorships also calls at pier 9 to offload automobiles and some breakbulk cargo. Although the pier's transit shed is large, containing about 112,000 square feet of useable space, it has a relatively small area for effectively handling cargo due to the many columns and structures which limit the inside spaces. Pier 10 is an operational base for tugs. Pier 11, a 580-foot-long marginal wharf of concrete pile with a 123,750 foot transit shed, is in good condition. This pier, which includes a 26 foot working apron, is owned and used by GPRL for handling breakbulk traffic moving from and to U.S. Gulf ports. Piers 12 and 13, marginal wharves of 700 foot length, include 33,000 square feet of transit shed space and 15,000 square feet of open storage area.

In 1967, pier 12 handled 99,265 tons and pier 13, 85,960 tons of cargo. GPRL uses part of pier 12 for handling cargo. In addition, various foreign carriers from Europe call at this pier to unload iron and general cargo. Pier 14, a 446 foot marginal wharf with a 40,000 square foot transit shed, handled approximately 162,000 tons in 1967. Foreign ships unload lumber, iron, and general cargo at this pier which is in good condition.

34

When considering berth utilization, a rule of thumb for efficient utilization in Puerto Rico is 130,000 tons per pier of 550-foot length, or 236 tons per foot. On this basis, except for pier 14, all piers are utilized inefficiently. For example, in 1967, pier 1 handled only 94 tons per foot, and, pier 6, 26 tons per foot, both of which were far below the 236 tons per foot considered as an indicator of efficiency. The most apparent cause of low terminal efficiency in the Old San Juan area is the obsolescence of the facilities. In recent years, however, there has been some effort to modernize and upgrade some of the pier facilities, such as the passenger terminal, pier 3. What is needed to facilitate cargo handling operations are wider marginal piers, wider working aprons, mechanical equipment, more adequate transit shed facilities, and better road acces sibility. The large increase in traffic due to economic development and growth in population demands additional port development in these areas.

(4) Mandatory Delivery.35 A possible method of alleviating the congestion in the terminal areas would be the use of forced deliveries for LTL shipments. At present, Sea-Land unloads its LTL vans and spots them at the LTL terminal (shed D) where they are unloaded. The LTL cargo remains in shed D until the consignee calls for it with his own truck, usually not until the last day of free time. The cargo awaiting pickup creates congestion in the shed due to the limited storage space available, and the trucks which call for the cargo clog the terminal and inhibit circulation within the marshalling yard. Under a system of mandatory deliveries for LTL cargo, the ocean carrier would unload the LTL vans and place the cargo in the delivery trucks at shed D, normally within 48 hours after the arrival of the van. Because LTL cargo would remain in the

34 Adams, Howard, and Oppermann Planning Consultants. Erik Svenson, Associate Planner, Ernst Fraukel, Associate Consultant in Marine Engi. neering and Operations, Comprehensive Development Plan for the Port of San Juan, P.R. (Massachusetts: October 1964), pp. various pages.

35 Mandatory delivery would require store-door delivery for shipments rather than allowing delivery at the terminal.

30 Free time is a period, usually consisting of 5 days at Puerto Rico, during which the shipper may pickup his cargo at the carrier's terminal without charge. After the expiration of the free time, a demurrage charge is assessed on a daily basis.

terminal for no more than 2 days instead of up to 5 days or longer, congestion on the platform would be significantly reduced and less transit shed platform space would be required for this cargo. In addition, Sea-Land's present requirement for an additional 100,000 square feet of platform space (and future requirements for 300,000 square feet) in Puerto Nuevo would be largely eliminated.

In a docketed proceeding," the FMC found SeaLand's practice of providing mandatory deliveries of minimum shipments to be lawful and stated that the mandatory delivery rule which it then considered "goes a long way toward eliminating a problem of congestion." Truckers on the U.S. mainland provide mandatory delivery of LTL cargo. Mandatory delivery in the United States has eliminated congestion in terminals by facilitating the movement of freight and has permitted carriers to operate with less terminal space. Because the containership operations at the Puerto Nuevo terminal are virtually identical to those on the U.S. mainland, mandatory delivery from Puerto Nuevo on LTL traffic should result in similar efficiencies and reductions in cost. GPRL now provides a store-door delivery rule on all LTL shipments under 6,000 pounds. Effective August 14, 1969, Sea-Land commenced mandatory store-door delivery on most LTL shipments under 3,000 and under 700 cubic feet 38 to avoid congestion at the terminal and to effect faster turnaround. Carriers may go beyond the present weight and cubic capacity limits on mandatory delivery. Although mandatory delivery on LTL cargo may generate greater efficiencies in traffic distribution on the Island, the FMC should maintain continuing surveillance over these arrangements to assure that the public interest is protected.

(5) Facilities and Proposed Improvements.-The Ports Authority finds there are sufficient factors to justify large scale improvements not only to Puerto Nuevo but also to harbor facilities at San Juan. These are: (1) Deepening of the Puerto Nuevo and grading dock channels to at least 35 feet; (2) widening of the turning basin at the intersection of the Army Terminal. and Puerto Nuevo channels; (3) widening of the turning basin at the junction of the Puerto Nuevo and grading dock channels; and (4) provision of the new and larger deep channel anchorage basin at the junc

37 Charges, Delivery, Atlantic-Gulf/Puerto Rico Trades, 11 FMC 222, 236 (1967).

38 This delivery rule does not apply on household goods, personal effects, controlled temperature cargo, nor on pieces exceeding 15 feet in length.

tion of the widening of the Army Terminal and entrance channels.39 The cost estimate is some $15.77 million. The justifications stated by the Ports Authority 40 for improvements to these facilities are: (1) Reduction of serious maritime accidents within the harbor; (2) accommodation of large ships; and (3) expansion of trade with the principal ports of the U.S. mainland using larger container vessels which will provide lower unit costs of transportation. These improvements will require the assistance of the U.S. Army Corps of Engineers, according to the Ports Authority.

c. Trends in Containerization

The Port of San Juan will have the opportunity of fostering the potentialities inherent in the tremendous developments which are taking place in sea and road transport. Current literature" and recent experience in ship design, including new methods of handling cargo,42 make it possible to estimate innovations which may take place in this trade during the period 1969-75. In the very near future, the sea and road transportation picture of Puerto Rico will be radically altered and San Juan will be able to demonstrate its prominence in the world of transportation. Port development plans, internal trucking and distribution patterns, as well as related regulatory procedures will have to keep pace with these trends in order to accommodate the new technological changes taking place.

(1) Marine Transport.-The most significant change in Puerto Rico's transportation system will be the introduction of mammoth containerships with larger container loads, faster turnaround, and speeds in excess of 26 knots, which should counter the rising costs of stevedoring, ship construction, and terminal development.13 Transamerican Trailer Transport's new Ponce de Leon and Sea-Land's six 1,300 container vessels now programed for construction are examples of the trend toward larger and faster ocean vessels of the roll-on/ roll-off or lift-on/lift-off variety. The advantages of these larger container vessels are illustrated in table VI-8 below which shows that during a given period of time a large containership (Sea-Land C-4JX) is mor efficient than a smaller ship (C-2X vessels).

39 Puerto Rico Ports Authority, Statement by the Puerto Rico Ports Authority on the Matter of Improvements to Navigation Facilities in the San Juan Harbor (San Juan: March 1968), pp. 4-12. 40 Ibid.

41 Shipping World, Ports of the World (London: 1960), pp. various.

42 McKinsey and Co., Inc., Management Consultants, Containerization-Its Trends, Significance and Implication (London, British Transport Docks, June 1967), pp. various.

43 Ibid.

TABLE VI-8

Table VI-8 shows that the average cargo handling time of a large C-4JX vessel, carrying 609 containers is 20 hours, compared to 10 hours for the smaller C-2X-type vessel, carrying 225 containers. In the same time period, the larger ship handles an average of about 35 percent more containers than the smaller vessel, demonstrating the economies inherent in larger size vessels.

In 1965, over 40 percent of all oceangoing freighters were over 450 feet in length. Moreover, traffic growth signifies a shift to jumbo-size container vessels. SeaLand's 1975 container traffic will amount to almost four million tons, representing a gain of more than one hundred percent over the 1.66 million tons of 1967.44 Traffic carried by other common carriers, including TTT, Seatrain, TMT, and SACAL, also will double (ch. II). If this increase in traffic were carried by present size containerships, the terminal facilities of San Juan and other ports would be virtually choked. Consequently, fast and large containerships will be needed to hold costs and terminal utilization factors to an acceptable level; and it is expected that mammoth containers and roll-on/roll-off type vessels will be calling at San Juan, P.R. on regular schedules in the near future.45 These vessels will, of course, require

44 This analysis focuses on Sea-Land because it is the dominant carrier with specific plans for construction of the new jumbo size container vessels. This forecast would, of course, apply equally to the operations of Seatrain, TMT, and SACAL as they also join in the trend toward larger and faster lift-on/lift-off, roll-on/roll-off type vessels. As previously indicated, TTT has already moved in this direction with the SS Ponce de Leon.

45 In addition, there is a trend toward: (1) Specialized pallet ships; (2) bulk carriers with integral unloading gear for moving wheat, rice, salt, cement, ores, lumber, lime, sulphur, coal, etc., even though a large number of carriers are relying on shoreside cranes; (3) multiple-hulled catamaran. type vessels for rapid transit of trailerships or wheeled vehicles to replace roll-on/roll-off vessels; and (4) small hydrofoils in short-range trades.

efficient and sophisticated terminal equipment designed to facilitate the vessels' operational needs for: (1) Fast turn-around.

(2) Effective storage warehousing facilities. (3) Adequacy of marshalling yard space. (4) Ease of movement and distribution. The efficiencies of these large container vessels will depend also on an adequate pickup and delivery feeder systems, the continued cooperation between carriers and industry and the influence of enlightened regulation, to reduce the average container turnaround time.

(2) Distribution Patterns.-The new concepts of large scale container movements are bringing about changes in the voyage and land distribution patterns of Puerto Rico's transportation system. As previously indicated, the efficiencies of containerized operations will increase container traffic (chart VI-2) and the establishment of new patterns of service and surface distribution will be important. In particular, the necessity for high capital investments, rising costs and the economics of transportation will demand a high concentration of cargo through a few or one modern high density terminal (load center) on the Island with overland distribution to and from points located within a 200 mile radius of the load center. This future concentration of traffic can provide lower unit costs not only on the ocean transportation but also on overland trucking routes up to 200 miles from the terminal. Instead of containerships going where the cargo is, in the near future, trailers, acting as satellites of the parent ships

46

40 McKinsey Co., Inc., Management Consultants, op. cit., p. 13. 47 Ibid

docking as such a load center, will pickup or deliver the traffic within prescribed operating distances.

(3) San Juan as a Load Center.-Considering that Puerto Rico is a relatively small Island, only 100 miles long and 35 miles wide, and that Ponce and Mayagüez are barely 45 and 70 miles from San Juan, the principle of one load center with subsequent overland trucking service to and from smaller ports and inland communities is particularly apropos to the port of San Juan (Puerto Nuevo). In this respect, the port of San Juan will have a unique opportunity to stimulate the revolution in sea and land transport and the new qualities emerging in transportation service.48

Puerto Nuevo's facilities make this terminal an excellent container load center for re-distribution of high density container movements throughout the Island.

But, as previously indicated, this new sea and land transportation picture of Puerto Rico will require aggressive and enlightened support for adequate terminal facilities and harbor development, including deeper navigation channels, ship anchorages, larger berthing and marshalling yard spaces, more warehouses, and efficient trucking service.

3. Port of Ponce

a. Traffic and Commerce

The harbor of Ponce is on the south coast of Puerto Rico, 32 miles east of the southwest corner (chart VI1). The deep-water terminal facility at Ponce, which is owned by the municipality, consists of a municipal pier almost entirely covered by a transit shed. The terminal includes four berths, which were used by Sea-Land, GPRL, Motorships, and Lykes in 1967. The terminal is used by Sea-Land, TMT, Seatrain, and SACAL to accommodate container pools. The 1965 total traffic through this facility amounted to 504,322 tons, a 30 percent decline over the 715,800 tons of a year earlier. In fiscal years 1966-67, a total of 277 American seagoing ships visited Ponce.

b. Berthing Facilities

Of the 504,000 tons of dry cargo that moved through the terminal at Ponce in 1965, 153,000 tons were transported by domestic offshore common carriers including Sea-Land, GPRL, Lykes, and Motorships. Bull Lines discontinued service to this port in 1962.

48 As indicated in chapter III section C, Puerto Rico's road system is being improved and will facilitate the proposition of a single load center.

49

Today, Sea-Land provides direct vessel service to Ponce once a month, generally resorting to substituted overland service from San Juan the rest of the month to distribute cargo for Ponce and surrounding communities. In 1967, this substituted service cargo amounted to approximately 112,000 tons, or 11 percent of the total traffic landed at San Juan by that carrier. The direct service to Ponce is provided by a C-2 type vessel, which docks at San Juan first and then is sent around the Island, stopping at Mayagüez enroute. The vessel docks at berths 3 or 4 at Ponce. It usually spends approximately 10 hours per visit, offloading about some 900 tons of general cargo 50 and loading about 500 tons of outbound canned tunafish, clothing, linen, shoes, and candies, mainly for transport to the New York market. In 1967, Sea-Land's direct service moved only 14,000 tons of cargo through this terminal.51 Motorships which calls weekly at berth 1 handled approximately 150 to 200 automobiles per visit. In 1967, this traffic amounted to only 6,000 tons. GPRL also calls weekly, averaging approximately 13 hours at berth per visit, and offloads mainly breakbulk cargo for consignees located in Ponce. This traffic amounted to 85,000 tons in 1967. Lykes Bros., which docks at berth No. 4, averaged approximately 18 hours of berthing time per visit on 26 calls per year. This carrier transported approximately 48,500 tons to and from this pier in 1967.

The Ponce Cement Plant, located in Ponce, ships large quantities of cement in its own vessel, a selfpropelled vessel of about 4,000 tons, to consignees in St. Thomas, St. Croix, and other small ports in the Caribbean. The foreign carriers calling at the municipal pier include Royal Netherlands Lines, which loads coffee and citron for Europe on a bi-monthly schedule; Nippon Yusen Kaisha, (K Line) which handles general cargo on a bimonthly schedule; and, approximately 11 small schooners which haul cement and lime from Ponce to the Virgin Islands. There were no figures available with which to analyze the terminal utilization at Ponce or compare its efficiencies with those of terminals at San Juan. Based on the tonnage carried by domestic offshore carriers, the facilities on the four

49 Sea-Land uses the SS Azalea City, SS Mayagüez, and SS Bienville, on direct calls to Ponce.

50 This general cargo is further distributed by pickup and delivery service to consignees in Ponce, Coano, Santa Isabella, Arroyo, Guayama, Adjuntas, Guanica, and Lajas.

51 In 1967, Sea-Land's total traffic to this area consisted of 154,000 tons, 14,000 of which were transported by direct vessel calls; 112,000 tons transported southbound by overland substituted service from San Juan; and, 28,000 tons transported northbound by overland substituted service to San Juan, and thence by vessel to ports on the U.S. mainland.