Dillon may be next site for inland port hub Rail would link Pee Dee region

A Norfolk Southern train waits for cargo to be loaded at the State Ports Authority’s inland port in Greer. The maritime agency plans to build a second inland port in Dillon.

The State Ports Authority, aiming to capitalize on industrial growth along the U.S. Interstate 95 corridor, said Wednesday it plans to develop an inland port in the Pee Dee region.

The roughly $30 million yard would be built at a Dillon commerce park where Harbor Freight Tools operates one of its largest East Coast distribution centers.

The facility would join the SPA’s existing inland port in Greer that opened in 2013, and would help the agency expand its rail distribution network.

The Upstate site along U.S. Interstate 26 is served by Norfolk Southern railroad. The Dillon site would be served by an existing CSX line.

Jim Newsome, the SPA’s president and CEO, said the I-95 operation — where cargo containers could be transferred between trains and trucks — “would be a great diversification of our logistics footprint.”

The plan is in the initial stages and more studies would have to be completed before the maritime agency decides to move forward with the project. Newsome said he hopes to finalize an agreement with CSX by the end of this year. The state’s newest inland port could be operating by early 2018.

“A second inland port in South Carolina would expand transportation options in the state, lowering shipping costs for South Carolina businesses and improving competitiveness,” Dean Piacente, CSX’s vice president for intermodal operations, said in a statement. “This project would also generate substantial public benefits by creating jobs, spurring economic development and reducing traffic congestion.”

Newsome estimates that moving cargo by rail between the Pee Dee site and the Port of Charleston will take between 150 and 200 trucks off of roads each day.

The Dillon facility would be built within the Tri-County Gateway Industrial Park, where Harbor Freight completed an expansion of its 2 million-square-foot distribution center in 2014. That center ships tools and other merchandise to more than 430 stores nationwide. Each year, Harbor Freight imports about 10,000 cargo containers of merchandise through the Port of Charleston.

The new inland port would make it easier for Harbor Freight and other existing SPA customers to ship their goods and would help the maritime agency attract new shippers in previously untapped Southeast and Midwest markets.

“The (cargo) volumes just in South Carolina are not sufficient for our aspirations, so we need to expand our cargo-generating hinterland,” Newsome said.

Inland ports are an increasingly important part of the nation’s manufacturing and retail-supply chains, as companies reduce inventory costs with “just-in-time” deliveries and e-commerce stores seek faster ways to ship products to customers.

The success of the SPA’s inland port in Greer has spurred other East Coast ports to build their own. The Port of Savannah, for example, plans to open an inland port served by CSX in Murray County, Ga., by 2018. The Port of Jacksonville is considering sites for an inland port in northeast Florida.

The SPA hopes to finance part of construction through a federal Transportation Investment Generating Economic Recovery, or TIGER, grant of up to $10 million, although competition for such funding is intense. The SPA received a $10.8 million TIGER grant in 2014 for rehabilitation of its Wando Welch Terminal in Mount Pleasant.

In addition to moving cargo, inland ports often are catalysts for construction of distribution centers and warehouses. Dollar Tree, for example, is building a 1.5-million-square-foot distribution center near the SPA’s Greer facility.

The inland port in Greer handles about 100,000 cargo containers per year and Newsome estimates the Dillon site would handle about half that amount. The Greer facility set a one-month record in March by handling 8,825 cargo containers.

Reach David Wren at 843-937-5550 or on Twitter at @David_Wren_