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Slowing economy, mill closures, reduces shipping on Tenn-Tom

The slowing economy that has led to closures of pulp and paper plants and steel mills has had a negative impact on use of the Tennessee-Tombigbee (Tenn-Tom) Waterway.

“If Alan Greenspan is looking for a barometer on the state of the economy, one of the best indications of commerce is what is moving on waterways,” said Don Waldon, administrator, Tennessee-Tombigbee Waterway Authority. “That is particularly true for heavy manufacturing. One of first things they do in a slowing economy is cut down on shipment of heavy materials for manufacturing. And that has been the case on the Tenn-Tom.”

Waldon said 2000 was the first year in the history of the Tenn-Tom that the tonnage of shipments decreased. Until 2000, tonnage was increasing at a rate of about 5% to 10% per year. And although figures aren’t in for 2001, the downward trend has continued.

“It is basically due to the cutbacks in steel production and the paper and pulp industries, two of the major users of the waterway,” Waldon said. “A good example is that the International Paper mill in Moss Point, a big user of the Tenn-Tom, just recently closed. Another paper plant in Mobile that closed recently, Kimberly-Clark, also was a big user of the waterway. Then we have some similar cases with reductions in steel, and that has hurt the overall tonnage of the waterway.”

Although he doesn’t have figures on the amount of decline in 2001, he is confident from his conversations with shippers that tonnage is down. The worst may be over, but it could take time to rebound.

“Whether it will come back this year, I have my doubts,” Waldon said. “But it is a short-term problem. As the economy, particularly for heavy manufacturing, improves, you will see the tonnage increase again. Obviously, that is not unique to Tenn-Tom, but is being seen throughout the nation, particularly on waterways that serve paper mills and steel mills.”

Aggravating the problem is the fact that more coal being used to produce electricity on the Gulf Coast by Mississippi Power, Alabama Power and Gulf Power in Florida is being imported from foreign countries like Columbia. Previously most of the coal was shipped from as far away as east Kentucky down the Ohio and Tennessee rivers and then the Tenn-Tom.

“That has had an adverse impact on shipments on Tenn-Tom as well as the other waterways,” Waldon said. “So it hasn’t been a good year to be in the waterways business from a commerce standpoint. I don’t see it getting any worse. I’m confident by next year we’ll see some of this traffic returning to the waterways.”

The waterway has seen some new industrial developments. Alliant Technologies has a new facility at the Tri-State Industrial Park that will be used to supply components for the Delta IV rocket being assembled by Boeing at its plant in Decatur, Ala. The Delta IV rockets are scheduled for launch in April 2002.

Waldon said the aerospace development provides the kind of highly-paid jobs that economic developers and residents want attracted to the area.

Also, Dyna Steel has located a new steel fabricating facility at the Yellow Creek Industrial Park. In addition, the Yellow Creek Industrial Park, which covers 900 acres, is in the process of constructing a new barge terminal facility.

Recreational is also a big part of the Tenn-Tom. The waterway is home to a significant amount of pleasure boat yachting, including a lot of boats from the Great Lakes area that migrate down the waterway on their way to Florida each winter. Yachts may spend a week or longer enjoying the local area before moving on.

“We’re doing an economic impact study of that one feature of the waterway,” Waldon said. “We think it is going to show a very beneficial impact. Recreation and tourism in that area just seems to grow every year.”

Waldon said the beauty of the waterway, particularly the portion in Tishomingo County, is the best kept secret not only in Mississippi, but probably in the South. Last year total visitation on the Tenn-Tom was greater than 3.1 million visitor days along the entire waterway, which converts into $200 million in additional economic spending each year.

“It is a major impact,” Waldon said.

Contact MBJ staff writer Becky Gillette at mullein@datasync.com or (228) 872-3457.


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