DATE: Friday, October 24, 1997              TAG: 9710240803

SECTION: BUSINESS                PAGE: D1   EDITION: FINAL 

SOURCE: BY CHRISTOPHER DINSMORE, STAFF WRITER 

                                            LENGTH:   56 lines

WEST COAST WOES EASED HERE RAIL, PORT BENEFIT FROM OBSTRUCTION.

Rail service problems plaguing the West Coast ports of Los Angeles and Long Beach are helping boost rail-shipped cargo through the port of Hampton Roads, according to Norfolk Southern Corp.

``Our port statistics show that problems in the West have resulted in customers rerouting traffic to the East,'' said L.I. ``Ike'' Prillaman, executive vice president-marketing at the Norfolk-based railroad.

``For the first eight months of this year, traffic through the port of Norfolk was up 7 percent,'' Prillaman said, referring to the intermodal shipping containers that the railroad piggybacks out of the port. ``In September, we realized a 40 percent increase in traffic.''

Much of the increase has been exports from Midwestern markets that normally are shipped through West Coast ports, said railroad spokesman Rick Harris.

This growth can be traced to a number of problems at the ports of Long Beach and Los Angeles, the nation's busiest.

Because of the explosion in world trade, those ports already are congested. Long-simmering tensions between port and maritime management and the West Coast dockworkers' union frequently boil over into work slowdowns and other disputes, which only worsens things.

But congestion became an outright snarl in August and September as the Union Pacific Railroad was overwhelmed by the volume of traffic that needed to be hauled out of those ports.

The Dallas-based railroad is struggling with its year-old merger with Southern Pacific Rail Inc. It doesn't have enough locomotives or train crews to handle the growing demands on its system. A string of accidents at Union Pacific prompted a federal safety crackdown.

``Without a doubt the Pacific Rim carriers are looking for an alternative,'' said Rick Knapp, assistant director at Virginia International Terminals Inc., the operating firm for the port of Hampton Roads' state-owned terminals.

Because of problems on the West Coast, East Coast ports can expect a gradual increase in the intermodal movements of containers through them, Knapp said.

``It looks like we've seen the first blip on the screen,'' Knapp said. ``Without a doubt we are seeing what the railroad is seeing.''

Still, the railroad's stunning growth is not really evident in the port's September results.

General cargo tonnage shipped through the region's state-owned marine terminals did surge 10.5 percent in September to 727,000 tons, Virginia International Terminals reported Thursday. The number of containers handled by state terminals in Norfolk, Portsmouth and Newport News grew 6.5 percent to 48,325, VIT said.

That's actually a little off the pace of the port's growth this year. So far in 1997, the state terminals have handled 6.8 million tons of cargo, a 13.8 percent gain over last year.

What VIT's numbers do not show, and Knapp declined to disclose, is how much cargo is moving about by truck or rail.

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