Trends in Global Shipping 

and the Impact on Alaska’s 

Forest Products

Joseph A. Roos, Allen M. Brackley, and Daisuke Sasatani

United States 

Department of 

Agriculture

Forest Service

Pacific Northwest 

Research Station

General Technical Report 

PNW-GTR-839

August 2011

DEPAR TMENT OF AGRICULT URE
Authors

Joseph A. Roos is a research associate and Daisuke Sasatani is a research 

assistant, University of Washington, Seattle, WA 98105; Allen M. Brackley is a 

research forester, U.S. Department of Agriculture, Forest Service, Pacific Northwest 

Research Station, Alaska Wood Utilization Research and Development Center, 

204 Siginaka Way, Sitka, AK 99835.

Cover: Prince Rupert Container Terminal, British Columbia, Canada. Photo by 

Allen M. Brackley.

The Forest Service of the U.S. Department of Agriculture is dedicated to the principle of 

multiple use management of the Nation’s forest resources for sustained yields of wood, 

water, forage, wildlife, and recreation. Through forestry research, cooperation with the 

States and private forest owners, and management of the National Forests and National 

Grasslands, it strives—as directed by Congress—to provide increasingly greater service 

to a growing Nation.

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activities on the basis of race, color, national origin, age, disability, and where applicable, 

sex, marital status, familial status, parental status, religion, sexual orientation, genetic 

information, political beliefs, reprisal, or because all or part of an individual’s income 

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opportunity provider and employer.
Abstract

Roos, Joseph A.; Brackley, Allen M.; Sasatani, Daisuke. 201l. Trends in global 

shipping and the impact on Alaska’s forest products. Gen. Tech. Rep. PNWGTR-839. Portland, OR: U.S. Department of Agriculture, Forest Service, Pacific 

Northwest Research Station. 30 p.

Traditionally, there has been a strong forest products trade between Alaska and 

Asia. This trade relationship has developed owing to Alaska’s proximity to Asia 

and, in the past, an abundance of high-quality timber. Although forest products 

markets in North America remain soft, markets in Asia are growing. However, to 

benefit from Asia’s growing forest products market, it is important to understand 

the concepts of global shipping including containerization, intermodal transport, 

non vessel operating common carriers, and freight forwarders. One key development that could have a major impact on Alaska’s forest products trade is the opening of the Port of Prince Rupert (British Columbia) in 2007. The Port of Prince 

Rupert ships lumber, logs, and wood pellets to Asia and is much closer to southeast 

Alaska than are the ports of Seattle and Tacoma. The Prince Rupert port is also 

1 day closer to Asia. Despite Prince Rupert’s proximity to Alaska, however, there 

is still no regularly scheduled barge service between the Port of Prince Rupert 

and southeast Alaska. Potential connections that may develop are examined in 

this paper. This paper also examines the changing concepts of global shipping 

and how they affect Alaska’s forest products industry.

Keywords: Global shipping, forest products trade, lumber exports, log exports.
Contents

1 Introduction

2 Current Trade Patterns

2 Why Export?

3 Exchange Rates

5 Exportable Alaska Forest Products

5 Sitka Spruce

7 Alaska Hemlock

9 Alaska Yellow-Cedar

10 Other Species

11 Global Shipping Trends

13 Ocean Shipping Rates and Volumes

18 Ports

22 Conclusions

24 Metric Equivalents

24 Literature Cited

29 Appendix—Sources for Global Shipping of Forest Products
1

Trends in Global Shipping and the Impact on Alaska’s Forest Products 

Introduction

Since the closing of the pulp mills in Sitka and Ketchikan, the relatively small 

sawmills in southeast Alaska have been producing factory and shop lumber and 

specialty products (Brackley and Haynes 2008) that require a supply of old-growth 

timber. Dimension lumber is a byproduct of these mills. One of the major issues 

facing southeast Alaska’s sawmills is securing a continuing supply of timber. 

According to a recent sawmill processing-capacity study, southeast Alaska’s forest 

products industry was estimated to be using approximately 13 percent of mill 

capacity (Brackley and Crone 2009). This report shows that there is ample processing capacity to increase supply to Asian markets. However, there needs to be a 

steady timber source to supply southeast Alaska’s mills. Demand for Asia’s forest 

products is growing faster than that for North America’s, presenting an opportunity 

to use Alaska’s excess mill capacity, if the producers recognize the requirements of 

the Asian markets.

Alaska has increased its kiln-dried lumber capacity, opening segments of the 

Asian markets that do not accept green lumber. In 2000, Alaska had an installed 

kiln capacity of only about 94,000 board feet, limiting its ability to export lumber 

to Asia and the Lower 48 States. To increase lumber kiln drying capacity, a federal 

grant program was initiated, and by 2004, Alaska had an estimated 220,000 board 

feet of kiln drying capacity (Nicholls et al. 2006). 

In addition to increasing kiln-dried lumber capacity, Alaska’s forest products 

industry further progressed by establishing three Western Wood Products Association (WWPA) registered grade marks: Alaska Hem, Alaska Yellow Cedar, and 

Alaska Spruce (WWPA 2005). These registered grade marks were the result of an 

in-grade testing program conducted by the Ketchikan Wood Technology Center. 

The results showed that the strength values of these species differ from those of 

species in the Lower 48 States. Product differentiation is a key principle of marketing; the establishment of these WWPA registered grade marks allows Alaska forest 

products to be differentiated from lumber in other regions. These registered grade 

marks along with Alaska’s ability to provide Asian markets with kiln-dried lumber 

has opened opportunities such as supplying the Japanese market with lamstock 

lumber (Roos et al. 2008a).

Logs from privately owned lands are the major forest product exported from 

southeast Alaska (Brackley and Haynes 2008). The total volume of specialty products and lumber available for export from the southeast region will always be small 

in relation to the total volumes traded in the Asian markets. However, the economic 

value from these exports is vitally important to maintaining the health of small 

One of the major 

issues facing 

southeast Alaska’s 

sawmills is securing 

a continuing supply 

of timber. 
2

GENERAL TECHNICAL REPORT PNW-GTR-839

rural communities of the region. The characteristics of the future wood supply, if 

any, will be a critical factor in determining the future markets for the small mills 

of the region.

Current Trade Patterns

International trade is a major component of Alaska’s forest products industry. The 

importance of Asia to Alaska’s forest products industry is illustrated by the total 

value of forest products exported by Alaska. In 2005, the total value of Alaska forest products was approximately $149 million (Halbrook et al. 2009). The bulk of the 

exported material was in log form, and total value of products exported to Asia was 

approximately $112 million, about 75 percent of the total value. Alaska’s vast forest 

resources and proximity to Asia give the state a natural competitive advantage in 

supplying Asia with forest products. 

Asia is the largest market for forest products exports from Alaska. Japan is the 

largest Asian forest products market by imports and places a high value on Alaska 

wood’s tight vertical grain properties (Roos et al. 2008b). However, as with the 

other global industries, Japan’s forest products industry was heavily affected by 

the recent financial crisis. The major driver for Japan’s forest products demand is 

housing starts, which declined 28 percent between 2008 and 2009 (JAWIC 2009). 

Although Japan will continue to be a strong market, future growth in Asian markets 

is expected to come from other Asian countries. Since the late 1990s, China and 

South Korea have experienced strong growth in their forest products markets. In 

2009, the value of wood products (harmonized code 4400)1

 imported by these 

countries was US$6.5 billion for Japan, US$5.1 billion for China, and US$1.4 billion 

for South Korea (GTI 2009). 

Why Export?

There are two major advantages of exporting. The first is revenue growth for forest 

products companies. Exporting requires a strong commitment from companies that 

includes adapting products to meet the needs of foreign markets, translating printed 

materials, developing relationships with foreign buyers, training personnel to 

understand foreign markets, and providing after-sale support for foreign customers. 

Exporters that invest the most effort in global markets are often the companies that 

thrive after economic downturns in these markets (Cunningham and Eastin 2002). 

1 Harmonized code is a multipurpose goods nomenclature used as the basis for Customs 

Tariffs and compilation trade statistics. The system was originally proposed by the U.N. 

World Customs Organization and implemented by an international convention on January 

1, 1988. Additional information is available at the following Web sites: http://unstats.

un.org/unsd/statcom/doc99/wcopaper.pdf; http://www.usitc.gov/tata/hts/index.htm.

Asia is the largest 

market for forest 

products exports 

from Alaska.
3

Trends in Global Shipping and the Impact on Alaska’s Forest Products 

The second major advantage is market diversification, and ocean shipping is an 

essential component for attaining this advantage. Although the U.S. economy is still 

suffering, the Asian economies, led by China, are helping to lead the world out of 

the global recession. However, to supply the Asian markets, forest products companies need to understand and utilize ocean shipping. The purpose of this paper is to 

analyze recent trends in ocean shipping and their impact on Alaska forest products 

exporters. 

Exchange Rates

One major factor influencing the shipping of U.S. forest products to global markets 

is exchange rates. Three major Asian currencies affecting Alaska’s forest products 

are the Chinese yuan, the South Korean won, and the Japanese yen. Recently, 

the U.S. dollar has been losing value against these currencies making U.S. forest 

products more price competitive in the Asian markets. As of November 2010, 1 U.S. 

dollar is trading at approximately 81 Japanese yen, 1,107 South Korean won, and 

6.65 Chinese yuan (Federal Reserve Bank 2010). Figure 1 compares the value of the 

currencies, using January 3, 2000, as a base year index in which all exchange 

values equal one. In this project, we are primarily concerned with Asian markets, 

but the value of the Euro has been included in figure 1 for reference purposes.

Figure 1—U.S. dollar indexed exchange rates (Index January 3, 2000 = 1). 

1.4

1.3

1.2

1.1

1.0

0.9

0.8

0.7

0.6

U.S. dollar index 

Japanese yen

Chinese yuan

Euro

South Korean won

1/3/2000

7/3/2000

1/3/2001

7/3/2001

1/3/2002

7/3/2002

1/3/2003

7/3/2003

1/3/2004

7/3/2004

1/3/2005

7/3/2005

1/3/2006

7/3/2006

1/3/2007

7/3/2007

1/3/2008

7/3/2008

1/3/2009

7/3/2009

Date
4

GENERAL TECHNICAL REPORT PNW-GTR-839

Japan has the third largest economy in the world and the yen is a major global 

currency. Traditionally, the Bank of Japan has favored extremely low interest rates 

making the yen very attractive to global investors. Global investors will borrow yen 

at low interest rates, convert the yen to other currencies, and invest the funds where 

returns are higher. The funds are then converted back to yen once investment gains 

are realized and the yen-based loans are repaid. This global investment strategy is 

called the “yen carry trade” and has fueled demand for the yen. Between mid-2007 

and 2010, the Japanese yen has increased substantially in value against the U.S. 

dollar. 

In addition to the Japanese yen, the value of the South Korean won has also 

strengthened substantially against the U.S. dollar. The strength of the South Korean 

won can partially be attributed to South Korea’s strong economic recovery. In the 

third quarter of 2009, South Korea’s gross domestic product (GDP) annualized 

growth rate was 2.9 percent, the countries’ highest growth rate in 7 years. Additionally, this was the third quarter of consecutive growth, showing that South Korea’s 

recovery is on a sustainable path (Reuters 2009). In 2009, as South Korea’s GDP 

growth improved, the won strengthened approximately 20 percent against the U.S. 

dollar from January to October. Furthermore, the median analyst forecast predicted 

the South Korean won would strengthen 7.4 percent further against the U.S. dollar by 

September 2010 (Brown and Lui 2009). The combination of an extremely cheap dollar against the won and a well-developed forest products market makes South Korea 

an important market for Alaska companies to examine. 

In contrast to the Japanese yen and the South Korean won, the Chinese yuan is 

not a free-floating currency and thus currency swings are not as drastic. In 1994, 

inflation in China rose above 20 percent and the Chinese government implemented 

an economic stabilization plan. The pillar of this plan was to peg the Chinese yuan 

to the U.S. dollar at a rate of 8.28 yuan to 1 U.S. dollar. However, pressure mounted 

from China’s trading partners to allow the yuan to float freely in the hope that the 

yuan would appreciate and reduce their mounting Chinese trade deficits. As a result, 

on July 21, 2005, the Chinese government initiated a managed float system against 

a basket of currencies. This system allowed the yuan to trade against a basket of 

currencies within a managed band. The basket of currencies includes the U.S. dollar, 

Euro, Japanese yen, South Korean won, and the British pound sterling. As of October 2010, the yuan has appreciated approximately 19.5 percent against the U.S. dollar 

since the managed float system was enacted. However, China has put the brakes on 

the yuan appreciation in reaction to the global economic crisis. The yuan has appreciated to 6.65 yuan to 1 U.S. dollar and is expected to remain at this level in order to 

help Chinese exporters weather the global recession (Brown and Lui 2009). 

In contrast to the 

Japanese yen and 

the South Korean 

won, the Chinese yuan 

is not a free-floating 

currency and thus 

currency swings are 

not as drastic.
5

Trends in Global Shipping and the Impact on Alaska’s Forest Products 

The future of the U.S. dollar remains uncertain. In 2009, the U.S. dollar softened against major currencies, making U.S. products more competitive abroad (fig. 

1). Looking to the future, Brazil, India, China, and Russia have publicly announced 

their intentions to increase their non-U.S. dollar holdings in order to diversify their 

foreign reserves (Nozawa 2009). This, combined with the U.S. fiscal and trade 

deficits and inflation fears, will place more pressure on the U.S. dollar to depreciate 

further against major currencies. 

Exportable Alaska Forest Products

The three major species that Alaska exports to Asia are Sitka spruce (Picea 

sitchensis (Bong.) Carrière), western hemlock (Tsuga heterophylla (Raf.) Sarg.), 

and Alaska yellow-cedar (Chamaecyparis nootkatensis (D. Don) Spach). One 

bright spot for the forest products industry since 2007 has been exports to Asia 

(Roos et al. 2008b). In contrast to domestic demand, which has fallen sharply since 

late 2007, demand for U.S. forest products in Asia has held fairly steady or actually increased. As described above, the largest forest products market in Asia is 

Japan, with China being a close second. The following sections examine the export 

volumes for logs and lumber of Alaska’s three primary export species. 

Sitka Spruce

Sitka spruce’s primary end market in Asia is Japan. Most of the logs exported to 

China are milled into products that are re-exported to Japan and other developed 

nations. Japan values the light color of Sitka spruce for interior millwork including 

door and window trims, paneling, and shoji screen door frames. 

Sitka spruce logs are categorized within trade statistics as spruce (Picea spp.), 

logs and timber, in the rough, not treated (harmonized code 4403200035). Total 

exports in this category have been increasing since 2000 (fig. 2). Canada is included 

in this section because it is the largest importer of U.S. spruce logs. The major 

Asian spruce log markets are China, Japan, and South Korea. Since 2000, Japan’s 

spruce imports have declined by about 50 percent, whereas China’s import volumes 

have surged by a factor of 13. It appears that China will surpass Japan in 2009 as 

the largest importer of U.S. spruce logs.

The second category examined was Sitka spruce lumber, which is categorized 

in the U.S. Customs statistics as Sitka spruce wood sawn (harmonized code 

4407100017 and 18). The primary markets for Sitka spruce lumber in order of 

quantity are Japan, China, and Canada. In contrast to spruce logs, Sitka spruce 

lumber exports have declined dramatically since 2000 (fig. 3). For example, in 2000, 

Japan imported 66 859 m3

 (28,348 mbf) of Sitka spruce lumber and the volume for 
6

GENERAL TECHNICAL REPORT PNW-GTR-839

Figure 2—Spruce (Picea spp.) log exports from the United States (USITC 2009); e = estimate.

Figure 3—Sitka spruce lumber exports from the United States (USITC 2009); e = estimate.

3.5

3.0

2.5

2.0

1.5

1.0

0.5

0

19951996

Spruce log exports (million cubic meters)

1997

19981999200020012002200320042005200620072008

2009e

Year

Others

China

South Korea

Japan

Canada

Sitka spruce lumber exports (thousand cubic meters)

0

20

40

60

80

100

120

140

160

1997

1998

19992000

2001

200220032004

2005

2006

20072008

2009e

Year

Others

Canada

South Korea

China

Japan
7

Trends in Global Shipping and the Impact on Alaska’s Forest Products 

2009 is projected to be approximately 6271 m3 (2,659 mbf). The major cause for 

the decline in the Sitka spruce lumber category has been the shift in Japan from 

importing lumber directly from North America to utilizing more European whitewood (mainly Picea abies (L.) Karst.) and importing spruce lumber milled in China 

from imported logs. Japan is followed by China and Canada, which are projected to 

import 2917 and 1861 m3 (1,236 and 789 mbf) of Sitka spruce lumber, respectively. 

Alaska Hemlock

Both western hemlock and mountain hemlock (Tsuga mertensiana (Bong.) Carrière) 

grow in Alaska. In the extreme northern areas of southeast Alaska, harvested material may include both species (Harlow and Harrar 1958). In the southern areas of 

the region, harvested areas support stands of western hemlock. The characteristics 

that distinguish western hemlock from mountain hemlock are needle, cone, and 

location-based characteristics. In the sawn form, mountain hemlock is more dense, 

but it is impossible to visually identify the species of origin. In the past, the primary 

use of exported hemlock was for Japan baby squares or posts used in traditional 

Japanese post and beam construction. However, starting in the mid-1990s, the 

Japanese market shifted to use of European whitewood lumber and laminated posts, 

and hemlock exports declined rapidly. Recently, demand for hemlock has increased 

as the U.S. dollar has depreciated against other major currencies. 

Hemlock logs are categorized in the U.S. Customs data as western hemlock 

logs and timber (harmonized code 4403200050). The U.S. Custom data show that 

in 2009, the United States exported approximately 625 000 m3

 (138,889 mbf) of 

western hemlock logs to South Korea, almost double the volume of 2000 (fig. 4). 

South Korea is increasing its use of western hemlock for construction applications, 

crating, and packaging materials (Roos et al. 2009). This country has blossomed 

as a value-added manufacturing hub that produces high-quality cars, high-end 

electronics, and heavy industry; which has fueled demand for crating, dunnage, and 

packaging. China and Japan also import western hemlock logs and their projected 

2009 volumes are 83 500 m3 (18,555 mbf) and 27 000 m3 (6,000 mbf), respectively. 

Western hemlock lumber is categorized in the trade data as hemlock wood 

sawn (code 4407100064 and 65). In 2009, the top three Asian markets for western 

hemlock lumber are projected to be China with about 37 000 m3

 (15,688 mbf ) 

Japan with about 16 000 m3 (6,784 mbf ), and South Korea with about 3600 m3

(1,524 mbf) (fig. 5) (GTI 2009). Canada was included in this analysis for comparison purposes because it is the largest hemlock lumber export market for the United 

States, with 2009 volumes expected to reach 49 000 m3

 (20,776 mbf).
8

GENERAL TECHNICAL REPORT PNW-GTR-839

Figure 5—Western hemlock lumber exports from the United States (USITC 2009); e = estimate. 

Note: South Korea included in “Others” for the years 1988–2009.

Figure 4—Western hemlock log exports from the United States (USITC 2009); e = estimate. Western hemlock lumber exports (thousand cubic meters)

1997

1998

19992000

2001

200220032004

2005

2006

20072008

2009e

Year

300

250

200

150

100

50

0

South Korea

Others

Canada

China

Japan

3.0

2.5

2.0

1.5

1.0

0.5

0

19951996

Western hemlock log exports (million cubic meters)

1997

19981999200020012002200320042005200620072008

2009e

Year

Others

China

Canada

South Korea

Japan
9

Trends in Global Shipping and the Impact on Alaska’s Forest Products 

Alaska Yellow-Cedar

Owing to its natural decay-resistant properties, Japan uses Alaska yellow-cedar 

(Chamaecyparis nootkatensis (D. Don) Spach) for sill plates (dodai) in their traditional post and beam construction. The sill plates lie on top of the cement foundation 

between the foundation and the wood frame of the house. Alaska yellow-cedar is also 

used for lamstock to manufacture glulam beams for exterior applications. Although 

this species is fairly popular in Japan, a majority of Alaska yellow-cedar is imported 

from Canada rather than the United States. The U.S. Customs data do not track 

Alaska yellow-cedar log exports as a separate category. However, Japan imports 

can be tracked through the Japanese government customs data (Japan Customs 

Bureau 2009). It is projected that in 2009 the United States will export approximately 18 000 m3

 (3,996 mbf) of Alaska yellow-cedar logs to Japan, and Canada 

will export approximately 22 000 m3

 (4,884 mbf) (GTI 2009). Alaska yellow-cedar 

log exports to China must be estimated from the “other” coniferous log category 

(code 4403200060) in the U.S. International Trade Commission data (USITC 2009). 

For 2009, Alaska yellow-cedar log exports to China are projected to be 4000 m3

(888 mbf), which is roughly 10 percent of the volume in the “other” log category 

described above. 

Alaska yellow-cedar lumber is categorized within the U.S. International Trade Commission data as yellow cedar sawn (code 4407100074 and 75). Alaska yellow-cedar 

lumber exports from the United States are relatively small with total exports slightly 

over 2000 m3

 (848 mbf) in 2009 (fig. 6). In contrast, it is projected that Canada will 

export approximately 80 000 m3 (33,920 mbf) of Alaska yellow-cedar lumber to 

Japan in 2009 (Japan Customs Bureau 2009). 

In examining the above data on all three species, it is important to note that 

many of the finished products from the logs exported to China end up in Japan. 

Alaska forest products can enter Japan via various distribution channels including 

exporting logs and lumber directly to Japan, or exporting logs to China, where they 

are milled and exported to Japan as lumber or other value-added forest products. The 

first two channels are easy to track via trade statistics. However, lumber that ends up 

in Japan via logs exported to China is more difficult to track. In fall 2008, a research 

project was undertaken to address the question of how logs exported from Alaska to 

China are being utilized. The researchers visited importers of Alaska logs in China 

and conducted interviews on how the logs were used and where the finished products 

were being distributed. The results showed that a majority of the clear portion of the 

logs were milled and exported to Japan directly or manufactured into other products 

such as glulam beams, millwork, and furniture, and then exported to Japan (Roos et 

al. 2009). The clear lumber is cut out of the log, and the cut stock is efficiently used 

Many of the finished 

products from the logs 

exported to China end 

up in Japan. 
10

GENERAL TECHNICAL REPORT PNW-GTR-839

for a variety of applications including laminated boards, door cores, and furniture. 

In conclusion, the weakening of the U.S. dollar makes Alaska forest products very 

attractive in Asia, which provides an opportunity for Alaska mills to increase their 

revenue. 

Other Species

Two other species that are indigenous to southeast Alaska are noted. Limited 

amounts of western red cedar (Thuja plicata Donn ex D. Don) are exported in log 

form. Logs of this species from old trees commonly are hollow butted and have 

extensive amounts of pecky heart rot (Harlow and Harrar 1958). Given a low ratio 

of recoverable material in relation to shipping weight, much of this material is sawn 

by local mills into products such as decking, siding, fencing, and shingles. Much of 

the red cedar product produced in the region is sold to local and national markets. 

Many of the areas cut during the last 50 years, especially areas with heavy soil 

disturbance, have regenerated to stands of red alder (Alnus rubra Bong.). The oldest 

of these stands is now approaching maturity. Recent research (Brackley et al. 2009) 

indicates that the grade recovery from logs of this species is comparable to material 

from other regions of the Pacific Northwest. Little of this material is now being 

harvested, but in the future, it may be an exportable product in either log or lumber 

form.

Figure 6—Alaska yellow-cedar lumber exports from the United States (USITC 2009); e = estimate.

Others

Canada

China

Japan

Alaska yellow-cedar lumber exports 

(thousand cubic meters)

1997

1998

1999200020012002200320042005200620072008

2009e

Year

18

16

14

12

10

8

6

4

2

0
11

Trends in Global Shipping and the Impact on Alaska’s Forest Products 

2 The use of trade or firm names in this publication is for reader information and does not 

imply endorsement by the U.S. Department of Agriculture of any product or service.

Global Shipping Trends 

Global shipping made significant leaps in the latter half of the 20th century. Some 

of the most significant developments have been cargo containerization, intermodal 

transport, the increased role of non vessel operating common carriers (NVOCCs) 

and freight forwarders, and shipping deregulation resulting from the Shipping Act 

of 1984 and the Ocean Shipping Reform Act of 1998. 

Containerization is the shipping of freight in standardized 20- and 40-foot shipping containers. Before containerization, a majority of freight was shipped as break 

bulk cargo. This made loading, unloading, and transferring of cargo to different 

modes of transportation extremely labor intensive. One of the first companies to 

attack these inefficiencies was Alaska Steamship,2

 which started using metal shipping boxes in 1949 (Kendall and Buckley 2001). 

Another major development in the shipping industry was the increase in 

intermodal transportation, defined as a systems approach in which goods are moved 

in a continuous movement from origin to destination using two or more modes of 

transportation (Kendall and Buckley 2001). During the transport from origin to 

destination, the container is not opened and the freight itself is not handled. For 

example, a 40-foot container of freight going from Chicago to Asia may travel by 

rail, truck, and ocean carrier. The container is transferred seamlessly from one 

mode of transportation to the next without being opened and the freight being 

handled. Intermodal transport allowed containerization to flourish by integrating 

the various modes of transportation including trucking, rail, ocean, and air into a 

fast and efficient transportation system.

The third development in shipping was the increased role for freight forwarders 

and NVOCCs. Intermodal transportation requires firms that specialize in coordinating the various modes of transportation into seamless point-to-point shipments, a 

role filled by NVOCCs and freight forwarders. An NVOCC is a common carrier 

that coordinates transportation and issues its own ocean bills of lading or other 

equivalent documents, but does not operate the vessels by which ocean transportation is provided. It also serves the role of consolidating shipments from various 

shippers. A freight forwarder is a third-party logistics agent that coordinates 

shipments for its customers. Freight forwarding services include booking cargo, 

preparing shipping and export documentation, consolidating freight, obtaining 

cargo insurance, and filing insurance claims. Many of the roles of freight forwarders and NVOCCs overlap. However, the difference between a freight forwarder and 
12

GENERAL TECHNICAL REPORT PNW-GTR-839

an NVOCC is that a freight forwarder acts as an agent for the shipper, whereas an 

NVOCC is a legally defined shipper and not an agent. Both NVOCCs and freight 

forwarders are licensed by the Federal Maritime Commission, and many freight 

forwarders also have a NVOCC license. 

Another major development was increased deregulation in the ocean shipping 

industry through legislation. One of the roles of the Federal Maritime Commission is to regulate agreements among groups of ocean carriers called conferences. 

Conferences are agreements between two or more shipping companies to provide 

scheduled cargo service on a particular trade route under uniform rates. These 

agreements also regulate the ocean shipping capacity of the trade routes their 

members serve. The major conferences with carriers serving the U.S. west coast/ 

Asia trade routes are the New World Alliance, the Grand Alliance, and the CKYH 

Alliance. The New World Alliance includes the American President Lines (APL), 

Hyundai Merchant Marine (HMM), and Mitsui OSK Lines (MOL). The Grand 

Alliance includes Hapag-Lloyd, MISC Berhad, Nippon Yusen Kaisha (NYK), and 

the Orient Overseas Container Line (OOCL). The CKYH Alliance includes China 

Ocean Shipping Company (COSCO), Kawasaki Kisen Kaisha (K-Line), Yang Ming 

Marine Transport, and Hanjin Shipping Company. Inherently, agreements among 

competing firms that set prices and limit capacity are in violation of U.S. antitrust 

laws. However, ocean shipping carrier conferences are allowed to set rates and 

control capacity within the United States because the Shipping Act of 1916 provides 

ocean shipping carrier conferences with immunity from U.S antitrust laws. 

In 1978, transportation deregulation was set in motion with the Airline Deregulation Act. One of the goals of this legislation was to increase competition among 

the airlines by removing government regulation of fares, routes, and schedules. This 

environment of deregulation led to an effort to stimulate more competition in the 

ocean shipping industry and reduce the power of ocean shipping conferences. The 

Shipping Act of 1984 was enacted to increase competition in the ocean shipping 

industry (Donovan and Bonney 2006). This act, while maintaining the antitrust 

immunity, required that conference agreements allow any carrier wishing to serve a 

specific trade route be admitted to the conference and any member wishing to leave 

the conference be allowed to leave the conference. It also increased market forces 

by allowing any conference member to take any independent action on rates. The 

expansion of market forces increased further with the Ocean Shipping Reform Act 

(OSRA) of 1998. This act required that members of conference agreements also be 

allowed to sign confidential contracts with shippers without violating the conference agreements. The major impact of OSRA was to increase the number of private 

shipping contracts between companies that ship products and ocean carriers. For 
13

Trends in Global Shipping and the Impact on Alaska’s Forest Products 

example, a retail chain importing a large volume from China could negotiate rates 

directly with an ocean carrier and these rates may be lower than the conference 

agreement rates. The Ocean Shipping Reform Act of 1998 resulted in a surge of 

private shipper/carrier contracts. The year following OSRA, the Federal Maritime 

Commission received 116 percent more applications for private shipper/carrier contracts than the previous year (Creel 2000). The rates established by private shipper/

carrier agreements often were more favorable than rates set by conference agreements, thereby reducing the importance of conference agreements. This act also 

increased efficiencies for intermodal transportation by permitting ocean carriers to 

offer inland transportation (Kendell and Buckley 2001). 

Ocean Shipping Rates and Volumes

The most recent event to affect the ocean shipping industry was the global economic crisis, which began with the U.S. mortgage crisis in late 2007. The slowdown 

in the global economy has led to excess shipping capacity and a decline in rates. 

Port traffic and ship container capacity are measured in 20-foot equivalent units 

(TEUs), which is the number of standard 20-foot containers that a port handles 

annually or that can fit on a container ship. For example, one standard 20-foot 

container equals one TEU, and one standard 40-foot container equals two TEUs. 

Figure 7 shows a sudden decline in 2008 in the volume of North American shipping 

activity as measured in TEUs handled by ports in the United States, Canada, and 

Mexico. The volumes declined further in 2009, leading to a glut of capacity. Many 

Figure 7—North American (United States, Mexico, and Canada) shipping volumes in 20-foot 

equivalent units (AAPA 2009). 

60

50

40

30

20

10

Twenty-foot equivalent units (millions)

0

Year

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

Container capacity 

is measured in 20-foot 

equivalent units (TEUs), 

which is the number 

of standard 20-foot 

containers that a port 

handles annually.
14

GENERAL TECHNICAL REPORT PNW-GTR-839

container ships are sitting idle in Singapore, where ships are often stored when they 

are not needed. At the same time, new ships ordered before the global credit crisis 

are nearing completion and will further increase the glut of capacity (Forsyth 2009). 

There are two methods for shipping Alaska forest products to Asia. The first 

is chartered ocean vessel and the second is a container ship with scheduled ports 

of call. Generally, charter vessels are used to transport raw materials such as oil, 

grain, coal, steel scrap, and logs. The advantage of a chartered vessel is flexibility 

in specifying cargo loading, offloading ports, and shipping dates. Traditionally, log 

exporters have employed specialty log charter ships. However, if log export charter 

ships are not available or too costly, logs can be cut to fit in standard sized 40-foot 

or high cube 40-foot containers. Given the availability of containers being returned 

to Asian countries, increasing volumes of logs are being shipped by this method. 

In contrast to chartering a vessel, shipping in a standardized shipping container 

via a scheduled ocean carrier service is generally cheaper than chartering for bulk 

cargo. Lumber is normally shipped either in a 20- or 40-foot standardized shipping 

container. The weight and dimension specifications of standardized shipping containers are shown in table 1. The weight of the lumber differs depending on whether 

it is green or kiln dried. The advantage of shipping kiln-dried lumber is that you 

reduce the water weight of the product, which also reduces the shipping costs. 

Table 1—Standard shipping container sizes

Inside Inside Inside Door Door Tare Maximum

length width height width height Capacity weight cargo

- - - - - - - - - - - - - - - - Feet - - - - - - - - - - - - - - - - Cubic feet - - - - Pounds - - - -

Standard 20 foot 19.33 7.67 7.83 7.67 7.5 1,172 4,916 47,900

Standard 40 foot 39.42 7.67 7.83 7.67 7.5 2,390 8,160 59,040

Source: SR International Logistics 2010. 

Table 2—Density of 

various commodities

Commodity Density

Pounds per

cubic foot

Douglas-fir lumber 35

Baled hay or straw 8–14

Feed grains 32

Ear corn 28 

Potatoes 43

Fruits and vegetables 30–40

Source: Carson 1989.

Depending on the density of the cargo, the 

limiting factor will be either the weight of the 

cargo or the cubic dimensions of the cargo. 

For example, a low-density cargo will reach 

the cubic volume limitations of a container 

before it reaches the weight restrictions of the 

container. Table 2 shows various commodities, 

their density, and how they compare to lumber. 

In contrast to a lower density cargo, a fairly 

dense cargo such as lumber will reach the weight 

restrictions of a container before exceeding the cubic-volume restrictions. 
15

Trends in Global Shipping and the Impact on Alaska’s Forest Products 

Another important constraint when shipping lumber in containers is road 

weight restrictions. The Federal Highway Administration has a formula for weight 

restrictions based on the gross vehicle weight including tractor, number of trailer 

axles, and the space between the axles. For example, a trailer with three axles 

where the first and third axles are spaced 97 inches apart can carry a load of 

42,000 pounds (U.S. Department of Transportation FHA 2009). Thus, although the 

container has the capacity to carry 59,040 pounds of cargo, the freight, if moved 

over the highway system is limited by the Federal Highway Administration weight 

restrictions. Foreign countries also have similar road weight restrictions, and these 

need to be checked if the cargo is going to travel inland from the foreign port. 

The general rate movement of bulk cargo is tracked by the Baltic Exchange. 

The Baltic Exchange is an intermediary exchange that brings together ship brokers, 

ship owners, and charterers to buy and sell bulk commodity shipping space in the 

global market. The Baltic Dry Index (BDI) is an index based on the average shipping prices for dry bulk cargo on the Baltic Exchange. The index shows how ocean 

shipping prices peaked in mid-2008, and then declined sharply in the beginning of 

2009 (Bloomberg 2010). Another factor influencing Asia-bound shipping container 

prices is the U.S. trade deficit, which has caused a glut of empty Asia-bound containers to be located on the west coast. The United States imports a large quantity 

of goods from Asia and exports a smaller quantity. For example, in Washington 

State, the export/import ratio is approximately 72 percent; in Oregon, it is approximately 98 percent, and at the Port of Vancouver (British Columbia), it is 72 percent 

(Goodchild et al. 2008). 

Developing a historical time series of container rates for lumber is made more 

difficult because there is no general index such as the BDI for lumber container 

rates. The Federal Maritime Commission requires that carriers file their tariffs 

or rates by commodity class with the Federal Maritime Commission (Federal 

Maritime Commission 2009). However, forest products are exempt from this 

requirement, making it very difficult to track ocean carrier container rates for 

lumber. For the purpose of this research, the Pacific Northwest Asia Shippers 

Association provided the researchers with estimates of lumber ocean shipping 

rates based on their negotiated contracts. Ocean shipping companies often add 

additional charges to their shipping rates including bunker adjustment factors 

(BAF) to accommodate for fluctuations in fuel prices and currency adjustment 

factor to adjust for currency fluctuations. For example, in April 2009, the rate for a 

40-foot container from Oakland to Tokyo for almonds was $1,400 plus a $226 BAF 

plus a $40 transfer charge, for a total rate of $1,666 (USDA AMS 2009). Figure 8 

shows the approximate annual rates for a 40-foot container of lumber from Seattle 
16

GENERAL TECHNICAL REPORT PNW-GTR-839

to Tokyo, including BAF. These rates fluctuated from $680 to $1,325 between 1997 

and 2009. As of November 2009, the lumber rate is approximately $800 per 40-foot 

container. 

In addition to lumber rates, ocean shipping rates for soy, almonds, and hay 

were examined. The U.S. Department of Agriculture, Agricultural Transportation 

Division publishes these statistics quarterly, and the annual rates for April were 

compared to lumber. It is important to note that the soy, almond, and hay rates are 

tariff rates and do not necessarily reflect actual shipping rates that are negotiated 

between companies and the ocean carriers. As discussed above, lumber rates are 

exempt from the Federal Maritime Commission’s tariff publishing requirements 

and therefore rates negotiated privately by an association were used. The analysis 

below compares lumber rates to rates for almonds, soy, and hay. It is important to 

note that the published shipping rates for almonds, soy, and hay may be higher than 

the actual rates that shippers negotiate with ocean carriers. Therefore, the data are 

used to present approximate costs to ship products from the Port of Seattle to the 

Port of Tokyo and to correlate various rates to lumber shipping rates. 

An analysis was conducted to examine the relationship between the lumber 

rates and other commodity rates. From 2001 to 2009, the mean shipping cost was 

$1,690 for almonds, $1,563 for soybeans, $1,347 for hay, and $1,014 for lumber 

Figure 8—Estimated lumber ocean shipping rates from Seattle to Tokyo per 40-foot container 

(PNASA 2009). U.S. dollars

1,400

1,200

1,000

800

600

400

200

0

1/1/1997

1/1/1998

1/1/1999

1/1/2000

1/1/2001

1/1/2002

1/1/2003

1/1/2004

1/1/2005

1/1/2006

1/1/2007

1/1/2008

1/1/2009

Date
17

Trends in Global Shipping and the Impact on Alaska’s Forest Products 

(table 3). The researchers used SPSS statistical software to conduct a Pearson 

correlation and ordinary least squares regression. The results of the Pearson 

correlation showed that lumber rates are most closely correlated to hay. The 

correlation between lumber and hay is significant with a correlation coefficient of 

0.72 (table 4). The correlation coefficient for hay was followed by almonds with a 

coefficient of 0.65 and soybeans with a coefficient of -0.37. The researchers also 

examined the relationship between oil prices and ocean shipping rates. There was a 

statistically significant relationship between oil and both hay and lumber shipping 

rates. Fuel is a large part of the cost of ocean shipping, and as oil prices rise, 

shipping rates also tend to rise. 

Table 3—Ocean shipping rates from Seattle to 

Tokyo for 40-foot containers 

Year Almonds Soybeans Hay Lumber

Dollars

2001 1,555 1,760 1,337 980

2002 1,170 1,520 929 770

2003 1,897 1,926 1,015 890

2004 1,350 1,147 746 950

2005 2,014 1,436 1,737 1,165

2006 2,151 1,099 1,510 1,265

2007 1,258 1,789 1,539 1,085

2008 2,153 1,643 1,915 1,235

2009 1,666 1,745 1,394 783

Mean 1,690 1,563 1,347 1,014

Source: USDA AMS 2009.

Table 4—Pearson Correlation and Regression results for ocean shipping rates

Soybean Almond Hay Lumber

rates rates rates rates

Correlation coefficient to lumber rates -0.37 0.65 0.72a 1

Correlation coefficient to oil prices -0.07 0.49 0.78a 0.69a

R-squared (dependent variable = 0.14 0.43 0.52a Dependent

lumber rates) variable

a Significant at the 0.05 level.

As a followup to the correlation analysis, three ordinary least squares linear 

regression equations were run using lumber shipping rates as the dependent variable and each of the respective commodity shipping rates as the independent 

variable. The results showed that hay was the only significant predictor for lumber 

shipping rates, with a coefficient of 0.35 and an R-squared value of 0.52. Therefore, 

even though there are no published rates for lumber, organizations can use the 

Lumber rates are 

most closely correlated 

to hay.
18

GENERAL TECHNICAL REPORT PNW-GTR-839

published rates for hay to get a rough idea for the shipping cost. Rates for hay and 

other commodities can be found at the USDA Agricultural Marketing Service 

(2009) Web site that is listed in the appendix. 

Ports

The main ports with container terminal capability that serve southeast Alaska forest 

products Asian exports are the Port of Seattle and the Port of Tacoma. Selected port 

schedules showing carriers, carrier alliances, and trade routes are shown in tables 5, 

6, and 7. The schedules are constantly changing, and these tables were included as a 

general reference rather than an exact shipping schedule. The one Alaska barge line 

Table 5—Port of Tacoma selected shipping schedules by carrier

 Partner

Primary carrier ETA ETD Alliance carriers Port rotation schedule

Evergreen (1st route) Fri Sat NA NA Tacoma, Taipei, Kaohsiung, Yantian,

Hong Kong, Kaohsiung, Los Angeles,

Oakland, Tacoma

Evergreen (2nd route) Fri Sat NA NA Tacoma, Vancouver , Tokyo, Osaka, 

Qingdao, Shanghai, Ningbo, Taipei,

Kaohsiung, Hong Kong, Yantian,

 Tanjung Pelepas, Colombo, Ashdod,

 Dekheila, Taranto, Genoa, Barcelona,

Valencia, Taranto, Port Said, 

 Colombo, Tanjung Pelepas, 

Kaohsiung, Yantian, Hong Kong,

Taipei, Osaka, Tokyo, Tacoma

Hyundai Merchant Marine Mon or Tues or New World APL, MOL Tacoma, Seattle, Vancouver, Tacoma,

Fri Sat Alliance Busan, Kwangyang, Kaohsiung,

Hong Kong, Yantian, Shanghai, 

 Busan, Tokyo, Tacoma

Kawasaki Kisen Kaisha Sat Sun CKYH COSCO, Tacoma, Vancouver, Kobe, Tokyo,

Alliance Hanjin, Nagoya, Kaohsiung, Xiamen, Hong

Yang Ming Kong, Yantian, Shanghai, Nagoya,

 Tokyo, Tacoma

Mitsui OSK Lines Wed Thurs New World APL, HMM Tacoma, Vancouver, Tokyo, Osaka, 

Alliance Kobe, Nagoya, Shimizu, Tokyo,

Los Angeles, Oakland, Tacoma

Yang Ming Transport Sat Sun CKYH COSCO, Tacoma, Los Angeles, Oakland,

Alliance Hanjin, Pusan, Kwangyang, Shanghai,

“K” Line Ningbo, Pusan, Tacoma

Horizon Barge Lines Wed Wed NA NA Tacoma, Anchorage, Kodiak, Tacoma,

Fri Fri Anchorage, Kodiak, Dutch Harbor,

Sun Sun Tacoma

ETA = estimated time of arrival; ETD = estimated time of departure, NA = not applicable.

APL = American President Lines; COSCO = China Ocean Shipping Company; Hanjin = Hanjin Shipping Company; HMM = 

Hyundai Merchant Marine; “K” Line = Kawasaki; MOL = Mitsui OSK Lines; Yang Ming = Yang Ming Marine Transport; 

CKYH Alliance =COSCO, “K” Line, Yang Ming, and Hanjin; New World Alliance = APL, HMM, and MOL.

Source: Port of Tacoma 2009.
19

Trends in Global Shipping and the Impact on Alaska’s Forest Products 

Table 6—Port of Seattle container ship sailing schedule outline

Primary

carrier ETA ETD Alliance Partner carriers Port rotation schedule

APL Fri. Sun. New World Hyundai, MOL Seattle, Vancouver, Yokohama, Kobe, Kaohsiung,

Alliance Chiwan, Laem Chabang, Singapore, Port Klang,

Kaohsiung, Hong Kong, Yantian, Shanghai, 

 Busan, Tokyo, Tacoma, Seattle

Westwood Wed. Thurs. NA NA Seattle, Hitachinaka, Shimizu, Tokyo, Busan, 

Shipping Osaka, Nagoya, Shimuzu, Tokyo, Everett, Seattle

OOCL Mon. Wed. Grand NYK, Hapag-Lloyd, Seattle, Vancouver, Tokyo, Nagoya, Kobe, Ningbo, 

(1st route) Alliance MISC Berhad Kaohsiung, Yantian, Hong Kong, Tokyo, Nagoya, 

 Seattle

OOCL Wed. Fri. Grand NYK, Hapag-Lloyd, Seattle, Busan, Kaohsiung, Hong Kong, Shekou, 

(2nd route) Alliance MISC Berhad Ningbo, Shanghai, Qingdao, Busan, Seattle

CSCL Sun. Mon. NA NA Seattle, Vancouver, Nansha, Hong Kong, Yantian, 

Shanghai, Ningbo, Busan, Seattle

COSCO Sun. Mon. CKYH Hanjin, Yang Ming, Seattle, Yokohama, Shanghai, Busan, Seattle

(1st route) Alliance “K” Line

COSCO Sun. Mon. CKYH Hanjin, Yang Ming, Seattle, Vancouver, Nansha, Hong Kong, Yantian, 

(2nd route) Alliance “K” Line Shanghai, Ningbo, Busan, Hong Kong, Yantian, 

Yokohama, Prince Rupert, Vancouver, Seattle

Northland Thurs. Mon. NA NA Seattle, Ketchikan, Petersburg, Juneau, Sitka, 

Services, Wrangell, Thorne Bay, Metlakatla, Seattle

Inc.

ETA = estimated time of arrival, EDT = estimated departure time; NA = not applicable.

APL = American President Lines; COSCO = China Ocean Shipping Company; CSCL = China Shipping Container Lines Co., Ltd.; Hanjin = 

Hanjin Shipping Company; Hapag-Lloyd = Hapag-Lloyd AG; HMM = Hyundai Merchant Marine; “K” Line = Kawasaki; MISC Berhad = Malaysia 

International Shipping Corporation Berhad; MOL = Mitsui OSK Lines; NYK = Nippon Yusen Kaisha; OOCL = Orient Overseas Container Line; 

Yang Ming = Yang Ming Marine Transport; CKYH Alliance =COSCO, “K” Line, Yang Ming, and Hanjin; Grand Alliance = Hapag-Lloyd, 

MISC Berhad, and OOCL; New World Alliance = APL, HMM, and MOL.

Source: Port of Seattle 2009.

Table 7—Example of Prince Rupert container ship sailing schedules

Primary

carrier ETA ETD Alliance Partner carriers Port rotation schedule

COSCO Wed. Thurs. CKYH Hanjin,Yang Ming, Prince Rupert, Vancouver, Seattle, Yokohama, 

(1st route) Alliance “K” Line Shanghai, Hong Kong, Yantian, Yokohama, 

 Prince Rupert

COSCO Wed. Thurs. CKYH Hanjin, Yang Ming, Prince Rupert, Long Beach, Oakland, Yokohama, 

(2nd route) Alliance “K” Line Dalian, Xingang, Qingdao, Shanghai, Prince

 Rupert

Hanjin Wed. Thurs. CKYH COSCO, Yang Ming, Prince Rupert, Vancouver, Seattle, Yokohama, 

 Alliance “K” Line Shanghai, Busan, Hong Kong, Yantian, 

 Yokohama, Prince Rupert

ETA = estimated time of arrival, ETD = estimated time of departure. 

COSCO = China Ocean Shipping Company; Hanjin = Hanjin Shipping Company; “K” Line = Kawasaki; Yang Ming = Yang Ming Marine Transport; 

CKYH Alliance = COSCO, “K” Line, Yang Ming, and Hanjin. 

Source: Prince Rupert Port Authority 2009.
20

GENERAL TECHNICAL REPORT PNW-GTR-839

that connects southeast Alaska to the Port of Seattle is Northland. This connection 

allows for intermodal service from southeast Alaska to Asia. A Northland container 

could be loaded in southeast Alaska and transshipped to a container ship at the Port 

of Seattle without unloading the cargo and having to transfer it to another container. 

Some other barge lines serving Seattle do not allow their containers to go to Asia. 

Thus, the barge line container must be unloaded and transferred to a shipping 

container owned by the ocean carrier that ships to Asia. 

One major development in the North American global shipping industry has 

been the establishment of the Port of Prince Rupert (British Columbia) in 2007. 

During its first full year of operation in 2008, the Port of Prince Rupert moved 

181,890 TEUs, which is a very small volume compared to other global ports. For 

example, in 2007, the number one port by volume was Singapore, which handled 

27.9 million TEUs. On the west coast, the Port of Los Angeles handled about 8.35 

million TEUs, and the Port of Seattle and the Port of Tacoma handled about 1.9 

million TEUs each (table 8). These data show that the Port of Prince Rupert is 

relatively small on a global scale. However, the port has phase II expansion plans to 

quadruple its capacity to a total of 2 million TEUs. This phase would also extend 

the wharf 800 m (2,600 ft), reach an 18-m (59-ft) water depth, increase the dock 

area to 56 ha (139 acres), and increase storage capacity to 28,560 TEUs. It would 

also increase the number of post-panamax cranes from two to eight. These cranes 

are equipped with the latest technology and have the ability to load and unload 

larger container ships (Prince Rupert Port Authority 2009). 

The development of the Port of Prince Rupert has significant potential for 

Alaska’s forest products industry. Approximately 74 percent of Alaska’s timber harvest in 2005 originated in southeast Alaska (Halbrook et al. 2009), and the Port of 

Prince Rupert opens up a new gateway to ship these products to Asia. The Port of 

Prince Rupert is significantly closer to southeast Alaska than are the ports of Seattle 

or the Tacoma. The distance from Ketchikan to Prince Rupert is about 85 mi, which 

is a sharp contrast to the 679 mi distance from Ketchikan to Seattle. Furthermore, 

the Port of Prince Rupert is 1 day closer to Asian ports than the Seattle and Tacoma 

ports. The critical missing link to connect southeast Alaska to the Port of Prince 

Rupert is a scheduled barge service.

Although the Port of Prince Rupert has potential as an Asian gateway for 

southeast Alaska, the essential component missing is scheduled barge service 

between southeast Alaska and Prince Rupert. The main companies with scheduled 

barge service between southeast Alaska and Seattle are Alaska Marine Lines, Boyer 

Barge, and Northland. As of this writing, none of these barge lines have service to 

Prince Rupert. However, the Canadian National Railroad (CN) runs a rail barge 

Some barge lines 

serving Seattle do not 

allow their containers 

to go to Asia. Material 

in containers from 

these companies 

must be unloaded 

and transferred to a 

shipping container 

owned by an ocean 

carrier serving Asia.
21

Trends in Global Shipping and the Impact on Alaska’s Forest Products 

Table 8—Port rankings by 20-foot equivalent units (TEUs)

Rank Port Country TEUs

1 Singapore Singapore 27,935,500

2 Shanghai China 26,152,400

3 Hong Kong China 23,998,449

4 Shenzhen China 21,103,800

5 Yingkou (Liaonian) China 13,713,000

6 Busan South Korea 13,254,703

7 Rotterdam Netherlands 10,790,604

8 Dubai Ports UAE 10,653,026

9 Kaohsiung Taiwan 10,256,829

10 Hamburg Germany 9,917,180

11 Qingdao China 9,430,600

12 Ningbo China 9,258,800

13 Guangzhou China 9,200,000

14 Los Angeles USA 8,355,038

15 Antwerp Belgium 8,175,951

16 Long Beach USA 7,312,465

17 Port Kelang Malaysia 7,118,714

18 Tianjin China 7,102,100

19 Tanjung Pelepas Malaysia 5,500,000

20 New York/New Jersey USA 5,299,105

21 Bremen/Bremerhaven Germany 4,892,056

22 Laem Chabang Thailand 4,641,915

23 Xiamen China 4,627,052

24 Tokyo Japan 4,123,920

25 Jawaharlal Nehru (Nhava Sheva) India 4,059,843

26 Dalian China 3,813,300

27 Tanjung Priok Indonesia 3,689,783

28 Gioia Tauro Italy 3,445,337

29 Yokohama Japan 3,428,112

30 Algeciras–La Linea Spain 3,414,345

47a Vancouver Canada 2,307,289

57a Seattle USA 1,973,504

59a Tacoma USA 1,924,934

b Prince Rupert Canada 181,890

a Missing some rankings.

b These are 2008 figures because that was the first year of operation for the Port of Prince Rupert. 

Source: AAPA 2009.

called the Aquatrain between Whittier, Alaska, and Prince Rupert, British Columbia. This has been in operation since 1962 and can be adapted to haul containers 

(Ladouceur 2009). These barges are operated by Foss Maritime for CN Railroad. 

There is an opportunity to establish an Aquatrain connection between southeast 

Alaska and Prince Rupert. In this case, freight from Ketchikan, Petersburg, Sitka, 

Wrangell, Craig, and other southeast locations would have to be consolidated in one 

location such as Ketchikan. The freight, once it enters Canada, is granted duty relief 

provided the container is exported within 30 days (Goodchild et al. 2008). 
22

GENERAL TECHNICAL REPORT PNW-GTR-839

Table 9—Performance of Prince Rupert terminal, 2008

Terminal Commodities Quantity

Metric tons

Fairview Terminal Containers 1,800,000a

Prince Rupert Grain Barley 443,482

Canola 323,465

Feed barley 0

Grain screen 14,912

Wheat 2,977,658

 Total 3,759,517

Ridley Terminal Coal 4,109,428

Coking coal 307,798

Petroleum coke 358,404

Wood pellets 71,401

 Total 4,847,031

Prince Rupert Harbor Log 119,936

a Reported as 181,890 TEUs. 

Source: Prince Rupert Port Authority 2009.

In 2008, forest products Asia-bound freight included containerized lumber, 

bulk logs, and wood pellets (table 9). However, there was very little forest products freight originating from Alaska owing to a lack of regularly scheduled barge 

service connecting southeast Alaska to the Port of Prince Rupert. 

Conclusions

This paper summarized trends in the global shipping industry and their impact on 

Alaska. The Asian economy, led by China, is the engine pulling the world out of 

the global recession. Although U.S. forest markets remain sluggish, markets such 

as exports of western hemlock to South Korea are expanding. Many U.S. forest 

products companies have found themselves overly reliant on the U.S. market and 

their sales plunged along with U.S. credit and U.S. housing starts. One key lesson 

to be learned from this economic downturn is the importance of global markets. 

The U.S. forest products companies that export to Asia will be able to ride on the 

coattails of Asian economic growth. The following are the specific observations of 

this research:

• The value of the U.S. dollar has decreased against major Asian currencies. 

This makes Alaska forest products including Alaska yellow-cedar, western 

hemlock, and Sitka spruce more price competitive in Asia.
23

Trends in Global Shipping and the Impact on Alaska’s Forest Products 

• Between 1997 and 2009, shipping rates for a 40-foot container of lumber 

fluctuated between about $680 and $1,325. As of November 2009, lumber shipping rates are about $800 per 40-foot container and, as the global 

economy improves, these rates could rise. 

• The Ocean Shipping Reform Act of 1998 mandated that ocean carriers be 

allowed to set up private shipping contracts with customers. This allows 

exporters to negotiate lower ocean shipping rates if they can promise ocean 

carriers a larger volume of export shipments. Therefore, it would benefit 

Alaska exporters to develop a shipping cooperation that includes forest 

products and other exports. The goal would be to approach ocean carrier 

shipping companies such as COSCO with a high group export volume in 

order to negotiate favorable rates. 

• There are limited intermodal connections from Alaska to Asia. Northland 

provides intermodal transport service through the Port of Seattle. They 

allow their containers to be loaded in Alaska and transferred directly onto 

ocean carriers bound for Asia, without unloading the containers. Some 

of the other barge lines do not allow their containers to go to Asia, so the 

cargo from these containers must be unloaded in Seattle (or another port) 

and reloaded into another container bound for Asia. This adds additional 

costs to shipping. 

• One of the biggest developments in shipping that could affect Alaska forest 

products exporters was the opening of the Port of Prince Rupert in 2007. 

However, for Alaska’s forest products industry to take advantage of Prince 

Rupert, scheduled barge service between southeast Alaska and the Port of 

Prince Rupert needs to be implemented. As of this writing, there is no 

barge service between southeast Alaska and Prince Rupert, so most of the 

containerized freight bound for Asia is barged farther south to either the 

Port of Seattle or the Port of Tacoma.

• The best potential barge service connecting southeast Alaska to Prince 

Rupert appears to be the Aquatrain barge, which is managed by the CN. 

The Aquatrain carries rail cars between Whittier, Alaska, and the Port of 

Prince Rupert, and can be retrofitted to carry shipping containers. However, 

there needs to be a coordinated effort among southeast Alaska exporters in 

all industries to demonstrate to CN that there is enough Asia-bound container volume to warrant a scheduled service.
24

GENERAL TECHNICAL REPORT PNW-GTR-839

Metric Equivalents

When you know: Multiply by: To find:

Inches (in) 2.5400 Centimeters (cm)

Feet (ft) 0.3048 Meters (m)

Miles (mi) 1.6090 Kilometers (km)

Acres (ac) 0.4050 Hectares (ha)

Log scale (mbf) 4.5000 Cubic meters, logs (m3)

Cubic meters, logs (m3) 0.222 Log scale (mbf)

Lumber (full sawn) (mbf )* 2.3600 Cubic meters, lumber (m3)

Cubic meters of lumber (m3) 0.4240 Lumber (full sawn) (mbf)*

Cubic meters of ALSC lumber (m3) 0.6200 ALSC dimension (mbf )**

ALSC dimension (mbf) 1.6140 Cubic meters of ALSC 

lumber (m3

)

Pounds (lb) 0.4540 Kilograms (Kg)

* The normal basis for lumber volume in countries on the metric system is the cubic meter. 

This is based on nominal dimensions and shipping dry (12 to 20 percent) moisture content. 

This calculation applies only where the differences between nominal and manufactured 

sizes are negligible. It would not be appropriate in a case where American Softwood 

Lumber Standards were converted directly to metric equivalents, retaining the differences 

between nominal and manufactured sizes (Briggs 1994). Other sources: (Fonseca 2005, 

FAO 2010).

** Based on the assumption that the material is rough green and not in accordance with 

American Lumber Standard Committee (ALSC) regulations, a factor of 0.424 per mbf per 

m3

 is used in this report. Given the statement by Briggs (1994) a factor of 0.620 per mbf per 

m3

 is more appropriate for ALSC dimension lumber. 

Literature Cited

Airline Deregulation Act of 1978; 49 U.S.C. Sect. 41713. 

American Association of Port Authorities [AAPA]. 2009. World port rankings 

—2007. http://www.aapa-ports.org/Industry/content.cfm?ItemNumber=

900#Statistics. (November 23, 2009).

Bloomberg. 2010. Baltic Dry Index statistics. http://www.bloomberg.com/apps/

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Brackley, A.M.; Crone, L.K. 2009. Estimating sawmill processing capacity for 

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29

Trends in Global Shipping and the Impact on Alaska’s Forest Products 

Appendix—Sources for Global Shipping of Forest Products

American Forest & Paper Association

China Office

Director of Marketing: Xu Fang

Rm 4706, Tower 1 Grand Gateway

One Hangqiao Road

Tokyo 107-0052 JAPAN 

200030 Shanghai, China

Tel: 86-21-6448-4401

Fax: 86-21-6448-4404

http://www.afandpa-china.org/

American Hardwood Export Council

U.S. Embassy 10F, 2-11-5 

Nishi-Temma, Kita-ku, Osaka 530-0047

Tel: 81-6-6315-5101

Fax: 81-6-6315-5103

E-mail: info@ahec-japan.org

http://www.ahec.org/

Commercial Service of the U.S.

Japan

U.S. Embassy Tokyo 

1-10-5 Akasaka, 

Minato-ku, Tokyo 107-8420

Tel: 81-3-3224-5060 

Fax: 81-3-3589-4235

E-mail:Tokyo.Office.Box@mail.doc.gov

http://www.buyusa.gov/japan/en/

Commercial Service of the U.S.

China

U.S. Embassy Beijing 

No. 55 An Jia Lou Lu 100600

Tel: 86-10-8531-3000

E-mail:Tokyo.Office.Box@mail.doc.gov

http://www.buyusa.gov/china/en/

Export.gov

A list of export resources offered by the U.S. government. 

http://www.export.gov/

JETRO 

Japan External Trade Association

San Francisco Office

235 Pine Street, Suite 1700

San Francisco CA 94104

Phone: 415-392-1333

Fax: 415-788-6927
30

GENERAL TECHNICAL REPORT PNW-GTR-839

Japan Lumber Journal

25 Sankyo Bldg. No. 523

1-48-10, Higashi Ikebukuro,

Toshima-ku, Tokyo Japan 170-0013

Phone 81-3-5950-2251

Fax: 81-3-5950-2271

E-mail: njlj@scan-net-ne.jp

http://www.jlj.gr.jp/

The U.S./China Business Council

U.S. Office

1818 N Street, NW, Suite 200

Washington, DC 20036

Phone: 202-429-0340

Beijing Office

CITIC Building, Suite 10-01

19 Jianguomenwai Dajie

Beijing 100004, China

Tel: 86-10-6592-0727

http://www.uschina.org/

Softwood Export Council Japan Office

Edward Matsuyama

Tomoko Igarashi

AIOS Toranomon 9F

1-6-12 Nishi Shinbashi, Minato-ku,

Tokyo,105-0003, Japan

Tel: 03-3501-2131

The National Customer Brokers & Freight Forwarders Association of America

1200 18th Street NW No. 901

Tel: 202-466-0222

Fax: 202-466-0226

http://www.ncbfaa.org/

United States Department of Agriculture 

Agricultural Marketing Service Ocean Rate Bulletin

Tel: 202-694-2505

http://www.ams.usda.gov/
Pacific Northwest Research Station

Web site http://www.fs.fed.us/pnw/

Telephone (503) 808-2592

Publication requests (503) 808-2138

FAX (503) 808-2130

E-mail pnw_pnwpubs@fs.fed.us

Mailing address Publications Distribution

Pacific Northwest Research Station

P.O. Box 3890

Portland, OR 97208-3890
U.S. Department of Agriculture

Pacific Northwest Research Station

333 SW First Avenue

P.O. Box 3890

Portland, OR 97208-3890

Official Business

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