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Furniture, NOS
Beverages, nonalcoholic
Cigarettes
Automobiles
House trailers
Pleasure boats
Stoves

Consumer goods:

Foodstuffs, mixed (canned goods mixed) Automobiles
Furniture

Flour
Beer and beverages

Manufactured tobacco (cigarettes) Soap and detergents

Groceries, NOS (canned goods) Household goods

Portable houses Frozen meats

Household goods
Fruits and vegetables

Furniture, NOS
Intermediate goods:
Construction machinery

Truck chassis (to 5,000 lbs.)
Empty bottles

I and S pipe fittings Paper products

Steel tanks, su or KD
Dairy feed

I and S structural material
| and S sheets or plates
Lumber, yellow pine
Lumber, NOS
Machinery, NOS
Bottles, common
Boxes, paper, SU or KD
Barrels, empty
Lime
Alcohol
Electrical goods

Trucks
Heavy equipment (machinery, NOS)
Lumber, hardwood
Doors (millwork)
Paper products (boxes, cartons, chip.

board, cardboard, NOS)
Restaurant supplies (utensils)
Animal feed
Cement

Rice, lubricating oils, chemicals, feedstuff, engines, paint and varnish, and trailers were principal moving commodities from Gulf ports.

Sources: Berwind Lines, Inc., Alcoa Steamship Co., and Florida Inter-Island Shipping Corp.

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CHAPTER 11

TRANSPORTATION SERVICES: THE VIRGIN ISLANDS TRADE

A. GENERAL

185,000 revenue tons and earned $5 million in freight revenues, a slight loss over the 226,000 tons and $5.5 million of a year earlier. Nevertheless, the trade aver. aged a steady growth during the 1963 to 1967 period as shown in table II-1 below. Alcoa, Atlantic, Netherlands Mead, "K" Line, Florida Inter-Island, and West India provide direct service between U.S. mainland and Virgin Islands ports. Berwind, which operates between San Juan and the Virgin Islands, provides connecting service for U.S. mainland traffic moving to the Virgin Islands via San Juan. During 1967, the aircarriers moved 14,300 tons.

TABLE II-1

The Virgin Islands has a unique situation with respect to transportation services. This area is offered a substantially broader variety of such services than is generally provided to other areas of similar economic and geographical circumstances. In spite of their rather isolated location, as well as their small economic and industrial base relative to the U.S. market, the Virgin Islands are served by a total of 11 carriers offer. ing a variety of roll-on/roll-off, lift-on/lift-off, breakbulk, barge, and aircarrier services. These services include: seven watercarriers which transported almost 95 percent of the U.S. domestic-Virgin Islands traffic in 1967 and four aircarriers which moved the remaining 5 percent of this traffic, an unusually high figure even for an island with no direct land connections. The car. riers in this trade provide the Virgin Islands with service from the New York area, Baltimore, Miami, major Gulf ports, major West Coast ports, and Puerto Rico. The sea time from New York is about 5 days; direct jet air time is about 3 hours.

In 1967, the 1l carriers including water and air transport carried approximately 204,300 revenue tons of cargo from the U.S. mainland and Puerto Rico to the Virgin Islands. The seven watercarriers including Alcoa Steamship Co. (Alcoa), Florida Inter-Island Shipping Corp. (Florida Inter-Island), West India Line (West India), Netherlands Mead N/V (Netherlands Mead), Atlantic Lines, Ltd. (Atlantic), Berwind Lines Inc. (Berwind), and “K” Line carried about

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1. U.S. Coastwise Laws

As indicated earlier, the Virgin Islands were acquired by the United States from Denmark on August 14, 1916. Prior to this acquisition, foreign flag vessels operating between the United States and the

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Virgin Islands were engaged in foreign commerce only. After the United States acquisition of the Islands foreign carriers were permitted to continue in the Virgin Islands trade until June 5, 1920 when the Mer. chant Marine Act, 1920 was enacted. Section 21 of the 1920 act extended the application of the coastwise laws to trades involving the Island territories and possessions after February 1, 1922. The President, however, was authorized to postpone the date of section 21 appli. cability when deemed necessary to ensure adequate shipping service. He did so with respect to the Virgin Islands by annual proclamation permitting foreign flag vessels to operate in the Virgin Islands trade until April 16, 1936. Because of expressed doubts concerning the merit of owning the Virgin Islands and also because it was feared that in the rush of other business the President might fail to reissue the annual proclamation, certain Virgin Islands interests pressed Congress to exempt specifically the Island trade from the restrictions against foreign vessel service. After prolonged consideration, Congress, in 1936, amended section 21 of the 1920 act to provide that the "coastwise laws" shall not apply to the Virgin Islands until the President by proclamation determines otherwise (Public Law 520, 74th Cong. 49 Stat. 1207).

In 1942, President Roosevelt, by Executive Order 9170 of May 21, 1942 (7 Fed. Reg. 382), ordered that all of the navigation and vessel inspection laws of the United States be made applicable to the Virgin Islands, except the "coastwise laws of the United States" and three other laws not pertinent to this discussion. There have been no changes in this provision since 1942. This waiver to the restriction of foreign vessels from en. gaging in U.S. coastwise trade has facilitated greater and more diverse services in the trade.

conjunction with proprietary operations on behalf of its parent company, Aluminum Company of America, primarily hauling breakbulk cargo from New York to St. Thomas and St. Croix. Its U.S. mainland terminals are berth 11, Port Newark Railway Co., New Jersey, and pier 9, Port Covington in Baltimore. In the Virgin Islands, Alcoa berths at the West India Co., Ltd. dock located at Charlotte Amalie, St. Thomas; in St. Croix, it berths at the Frederiksted Pier.

Alcoa is the major carrier in this trade in terms of revenue and tonnage. In 1967, Alcoa earned a total of $1,642,715 in revenue divided as follows: $598,401 (6,997 short tons) to Charlotte Amalie, St. Thomas from North Atlantic ports; $652,025 (9,446 short tons) to Frederiksted, St. Croix, from North Atlantic ports; $179,107 to Charlotte Amalie from Gulf ports; $205,937 to Frederiksted from Gulf ports, and $7,225 to Port Harvey, St. Croix, from Gulf ports. In 1967, Alcoa provided weekly service from New York and Baltimore to the Virgin Islands alternating between St. Thomas and St. Croix. This service was direct from New York, being the first leg of a voyage to Venezuela, Trinidad, and the Guianas, where bauxite was loaded for the return leg.

As of April 1, 1970, Alcoa still provided regular service from New York direct to St. Thomas and St. Croix. But, sailings have been reduced. It employs two 14 knot, 6,000 dwt. vessels which now call at St. Thomas once every 3 weeks; at St. Croix, once every 6 weeks. These vessels, S.S. Monique Schroder and S.S. Jenny Marine, are chartered from the world charter market. Their sailing time from New York to the Virgin Islands is 4 days; turn-around time for the entire voyage (New York-Virgin Islands-Venezuela-Guinea) is 38 days. Alcoa's principal moving breakbulk commodities include: automobiles, trucks, iron and steel-articles, tanks, flour, boxes, and food (see table 1-3). This carrier also moves some containerized cargo. In 1967, ample, its containerized cargo to the Virgin Islands comprised about 7 to 8 percent of its total traffic.3

2. Common Carriers in the Mainland

Virgin Islands Trade Unlike the Puerto Rican trade, the Virgin Islands trade is essentially an outport type of service which imposes various limitations upon the types of services generally offered by the carriers operating in this trade. Perhaps the small volume of traffic and breakbulk character of shipments are the principal limitations to more sophisticated service. Each Virgin Islands water carrier is examined below.

for ex

1 Letter of H. Olsen, Manager Tariffs, Alcoa Steamship Co., May 31, 1968 to Paul Gonzalez, Chief, Branch of Trade Studies and Special Projects, FMC.

2 Six chartered vessels, the S.S. Ernst Schroder, S.S. Erwin Schroder, S.S. Karina, M.S. Santa Katerina, S.S. Alex, and S.S. Susas, were used at one time or another. These vessels of medium size (about 3,000 to 8,000 dwt.) and speeds ranging from 13 to 15 knots, carried mainly breakbulk cargo.

3 In 1968, Alcoa considered establishing a full container service in this trade in order to reduce rising operating costs and to mitigate the effect of high landing charges (i.e., landing charges in 1968 were $6.50 per 40 cu. ft. at St. Thomas and St. Croix). Full container service was deferred, however, because the carrier's 1968 assessment of traffic flow to the Virgin Islands indicated that the Island's industrial base and terminal facilities were inadequate to support such an operation.

a. Alcoa Steamship Co.

Alcoa, which has served the Virgin Islands since before World War II, operates as a common carrier in

In 1967–68, Alcoa also provided service direct from gulf ports to the Virgin Islands. This service was suspended in 1968.

b. Berwind Lines, Inc.

using motor vessel tugs such as the Puerto Nuevo of 191 gross tons. Porto Rico Lighterage has represented the interests of the parent Berwind Corp. in the Caribbean for over 50 years.

Berwind owns and maintains a barge ramp terminal at Isla Grande, San Juan and uses the marginal wharves provided by the Virgin Islands Government at St. Thomas and Christiansted. The latter are of concrete construction and their size is 200 feet and 100 feet in length respectively. Depth alongside is 15 feet at both berths. No special equipment other than semitractors is used for their loading and unloading operations. The San Juan berths are discussed in more detail in part I, chapter VI.

Berwind, a subsidiary of Berwind Corp., a Pennsylvania firm having its origins in the coal-mining industry, is the principal carrier connecting Puerto Rico and the Virgin Islands. It mainly hauls traffic originating on the U.S. mainland which is transshipped at San Juan for further movement to the Virgin Islands. In 1967 (year ending September), Berwind, the second largest carrier serving the Virgin Islands, in terms of revenue tons, transported 73,061 revenue tons. Eightyeight percent of this traffic was outbound from San Juan. Berwind's total container traffic was 69,719 reyenue tons or 95 percent of its total. Sixty-nine percent of the container traffic was TL traffic, producing approximately 66 percent of its revenues.

In 1967, Berwind operated a barge service between San Juan on the one hand and Charlotte Amalie, St. Thomas, and Christiansted, St. Croix, on the other, usually alternating trips to Charlotte Amalie and Christiansted. During the year, it made 324 voyages to the Virgin Islands. The ships primarily employed by Berwind in this trade were the barges Luquillo and the St. Croix. When needed, it also used the Dorado and the Condado. Its vessels and the capacity of equipment are shown in table II-2. Berwind purchased some of these barges from the Porto Rico Lighterage Co. and chartered the rest from the same source.5 Porto Rico Lighterage Co. also provided the towage for Berwind

c. Atlantic Lines, Ltd.

In November 1968, Atlantic, a foreign-flag operator, inaugurated direct roll-on/roll-off service from New York and Miami to St. Thomas and St. Croix, with a sailing from New York approximately every 2 weeks; from Miami, every 10 days. This service replaced its breakbulk service which had been offered to the Virgin Islands in conjunction with South American ports of call. Its former breakbulk service operated approximately 26 voyages from New York and approximately 32 from Miami, utilizing at various times any one of seven breakbulk ships in the trade, each of approximately 500 gross tons. In November 1968, Atlantic placed the first of three newly constructed roll-on/rolloff containerships, each of 1000 dwt., into this service. These vessels, chartered from foreign operators, are the SS Jamaica Provider, the SS Pan Atlantic, and the SS Pan America, each capable of carrying thirty to thirtyseven 40-foot trailers adapted for either dry or reefer cargo.

* Berwind originates relatively little traffic. It is primarily the on-carrier for the containerized cargo transported by Sea-Land, TTT, and Seatrain from North Atlantic ports.

5 As of mid-1968, Berwind owned ninety-nine 35 foot dry cargo containers and two 32 foot reefer vans similar to those owned by Sea-Land.

& Chester, Blackburn, & Roder, Inc., general agents for Atlantic Lines. ? Atlantic Lines Ltd., Schedule No. 124, Mar. 1, 1968.

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Source: American Bureau of Shipping, Record of American Bureau of Shipping (New York: 1966), pp. various pages.

Atlantic's vessels are perhaps the most modern of those serving the trade. In spite of the general consensus that small containerships can operate successfully only on short runs involving quick turn-around, Atlantic has placed these 1,000-ton vessels in a relatively long haul trade. If this operation proves successful, it may suggest an extension of the container revolution to smaller ports similar to those in the Virgin Islands. Atlantic's rates are examined in chapter III following.

lotte Amalie at intervals of 2 weeks or longer utilizing alternately some 11 motor vessels ranging from 137 to about 3,200 dwt. Its principal U.S. mainland terminal is Palm Beach, Fla., with Houston and New Orleans also listed as ports of call. In keeping with its specialization in the transport of heavy equipment, most of West India's vessels are of the landing ship configura. tion. These vessels include:

d. Florida Inter-Island Lines, Inc.

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a

Florida Inter-Island operates several chartered vessels between U.S. South Atlantic and Gulf ports on the one hand and the U.S. Virgin Islands on the other. Although its vessels are capable of carrying a few containers up to 20 feet in length, Florida Inter-Island is basically a breakbulk operator. In 1967, it transported 21,000 tons between Miami and St. Thomas, a gain of 24 percent over the previous year. This amounts to approximately 850 tons per voyage. During 1967, Florida Inter-Island scheduled

voyages

from Miami to St. Thomas and St. Croix every 10 days. Actual operations to St. Thomas produced 25 voyages. This carrier earned approximately $311,723 from its St. Thomas trade alone. This represented an increase of 16 percent from its 1966 level of $268,741.o This traffic was approximately 96 percent outbound, indicating a considerable trade imbalance, even considering the possible backhaul of foreign traffic on these same voyages. In 1968, Florida Inter-Island began service between U.S. Gulf ports and the Virgin Islands following Alcoa's withdrawal from this service.

In 1968, Florida Inter-Island utilized seven chartered vessels of 930 to 1,850 tons and speeds of 9 to 11 knots in the Virgin Islands Trade.10 These vessels have a turnaround time of about 15 days and sea time of about 10 days.

Netherlands Mead provides breakbulk service from Miami to St. Thomas and St. Croix as part of a service which includes calls at the Bahamas and the Netherlands Antilles. 11 It employs one small vessel, the MV Santo Antonio, a breakbulk shelter-deck vessel built in 1958.12 The Santo Antonio sails every 3 weeks from Miami, with an average turnaround of 2 weeks per voyage. The vessel calls at the submarine base, St. Thomas and at the Island Transportation Service's facility, St. Croix. Its estimated 1967 tonnage was 5,000 tons, or approximately 300 to 350 tons per voyage.

g. “KLine

a

e. West India Lines

West India, which has its headquarters in West Palm Beach, Fla., is an affiliate of Inagua Transports, Inc. of Liberia from which it charters its vessels. Its primary business is the transport of large heavy machinery and equipment on a contract basis throughout the world. In 1968, West India called at Christiansted and/or Char

Kawasaki Kisen Kaisha of Kobe, Japan, 13 which operates as “K” Line, began operations in the West CoastVirgin Islands trade in 1967 in response to a pressing need for shipping space for plywood and lumber products from the West Coast. As demand for plywood slacked off, “K” Line began to carry more general cargo. The most important commodities now carried are lumber, canned goods, household goods, and gov. ernment space cargo (GSA). No reefer cargo is accepted. In 1967, it carried about 3,000 tons of cargo in this trade along with cargo destined for foreign ports. This amounts to about 250 tons per voyage, mostly breakbulk cargo. “K” Line hopes to diversify its cargo

8 Letter of F. Navia, Executive Vice-President (enclosure) Florida Inter. Island Shipping Corp., Mar. 29, 1969 to Paul Gonzalez, Chief, Branch of Trade Studies and Special Projects, FMC.

9 Ibid.

10 Florida Inter-Island Lines used the following vessels : MV Terrala, 1,319 dwt., MV Charta, 940 dwt., MV Caribbean Mist, 1,850 dwt., MV Rowin, 1,170 dwt., MV Westzoan, 1,050 dwt., MV Mitropa, 1,080 dwt., and MV Jousi, 930 dwt.

11 General agent for Netherlands Mead is Caribe Shipping Corp. of Miami Beach, Fla.

12 The vessel is 189 ft. in length, 489 gross tons, and has a cruising speed of 10 knots. It has two general cargo holds and three reefer compartments.

13 Kerr Steamship Co., 350 California Street, San Francisco, Calif., general agents for Virgin Islands service.

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