Port Company Succeeds Despite High Fuel Costs

It can cost almost eight times more to ship 1,500 tons of bulk freight on a tractor-trailer than on a river barge. That breaks out to be about $14.55 per mile on a river barge compared to $112.50 per mile on a truck. Some manufacturing companies in Northwest Arkansas have figured that out. And every year, more companies are catching on. Marty Shell is banking on it.

Shell, part owner of Five Rivers Distribution LLC in Van Buren, declined to reveal tonnage amounts per year, but he said his port has experienced about 10 percent to 15 percent growth in tonnage “over the past few years.”

According to the Arkansas Waterways Commission, more than 15 million tons of cargo valued at more than $2.7 billion is transported along the state’s rivers.

About 90 percent of the freight shipped into Five Rivers’ port is imported from countries like China, Russia, United Kingdom and Germany, Shell said.

“It makes this area a global trading area,” he said. “It’s a very useful source for companies to buy bulk products for manufacturing.”

Local companies that import bulk goods have tapped into the river barge system to save money, Shell said. But there’s one drawback.

“Barges are the cheapest mode of transportation but also the slowest,” he said.

A barge coming from New Orleans, where midstream ships unload onto river barges, can take about eight days to reach Van Buren. A rail car takes about four to five days to make the trip, and a truck can reach the port overnight. But it’s the volume shipped that makes using the river system cost efficient. What one barge can carry equals 66 truckloads.

“And that’s 66 trucks you don’t have to see on Highway 71,” Shell said.

When it arrives at the port, it takes about six to eight hours to unload a barge. After the freight is unloaded, it’s loaded onto rail cars or forklifts transport it to the company’s 100,000-SF climate controlled warehouse where it waits to be loaded onto trucks to be shipped out.

The crane and dock is covered with a roof, enabling them to work in all kinds of weather conditions, Shell said, adding that it’s the only dock of its kind in the area.

Outside, the company has 14 acres it uses for storage, with an extra 106 acres for future growth.

Five Rivers also has its own trucking company division. Shell said he has seven tractors and nine trailers. One driver can make about three trips a day to Northwest Arkansas and still be under the daily legal driving time, he said.

Shell said that with high gasoline prices, fuel surcharges are high for customers using trucks to transport freight. So, if a customer can wait for inventory, they can save money, he said.

And the customer doesn’t have to have 1,500 tons of product shipped either. A lash barge can carry 400 tons, which would be perfect for small operations.

With hurricane season around the corner, Shell said his company is at the mercy of Mother Nature.

Last year, Hurricane Katrina caused a 20 percent drop in his business for two months after it hit the Gulf Coast. Nothing came into his port or left his port for a week, he said.

“Some are scared now because hurricane season is approaching again,” he said. “But it’s slowly coming back, and it may take years and years.”

The ports are now running at full capacity, Shell said, but they’re lacking manpower to operate the barges. He said once manpower is back up to discharge the barges, his capacity should increase even more.