News Updates
GO EAST: RISING GRAIN OPPORTUNITIES BENEFIT GREAT LAKES-SEAWAY PORTS BY JULIE GEDEON
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he Great Lakes and St. Lawrence ports enjoyed another strong year in handling Canadian crops, with 2018 promising to be even busier. “Canadian grain and pulses through the St. Lawrence Seaway totalled 8.306 million metric tons in 2017, another strong year,” confirms Bruce Burrows, the president of the Chamber of Marine Commerce. “Many people don’t realize that a quarter of Canadian grain exports move through Eastern Canada, including the Great Lakes and St. Lawrence waterway. Western Prairie and Central Canadian farmers rely on this important transportation corridor for exports to Mexico, Europe, the Middle East, Africa and even Asia.” A large 2017 wheat harvest is expected to carry over into this year’s Great Lakes-St. Lawrence shipments. The higher quality of wheat is anticipated to be in demand with the International Grains Council forecasting global wheat production to decline in 2018-19 for the first time in six years. “Our Great Lakes-Seaway ports are ready to handle larger volumes, as they certainly proved this past year,” Burrows says.
The Port of Hamilton enjoyed a record-breaking year in 2017, managing the most agricultural products in its history. Nearly 2.3 million metric tons of agricultural commodities that included wheat, corn, soybeans as well as canola, sugar, potash and other fertilizers were handled. Almost one-quarter of the port’s cargoes are now agricultural compared to 12.5 per cent eight years ago. Ian Hamilton, the Hamilton Port Authority’s president and CEO, credits bringing together the right elements to attract 14 tenants within the agri-food sector. “Our port has invested upwards of $200 million to improve port roads, rail lines, dock walls and other infrastructure over the last decade to ensure smooth transitioning for these clients.”
Agri-food giant investments Various investments by agri-food giants Richardson International, Parrish & Heimbecker, and G3 Canada have tripled the port’s capacity to handle wheat and other agri-food products. P&H Milling Group additionally invested $40 million (with another $5 million in provincial funding) to build Ontario’s first new flour mill in 75 years.
Meanwhile, the Port of Montreal handled approximately 4.5 million metric tons of grain in 2017. While that is approximately 10.5 per cent less than in 2016, “that’s still a great year,” says Tony Boemi, the Montreal Port Authority’s vice president of growth and development. “Before Viterra took over the port’s grain terminal in 2011, the port was only doing about 1.8 million metric tons.” Boemi applauds the expertise and initiative of Viterra and another recently acquired agri-food tenant, CanEst Transit, for significantly increasing the port’s crop handling. “They’re constantly seeking out new opportunities, as opposed to the port merely facilitating what happened to come its way in the past, especially during the wheat board days,” he explains. “For instance, Viterra has established year-round rail movement of grain to the port as part of our winter rail program.” The port has been facilitating better connectivity. “This year and next, we’re investing another $40 million in our port rail network,” Boemi says. “The additional track within our boundaries will improve fluidity throughout the port area.” As part of the 40-year lease it signed with CanEst Transit in October 2014,
the port allocated the $4 million dollars slated for a derelict’s silo’s demolition to upgrade the building along with road and rail access. CanEst reached the 100,000 metric tons it had initially planned to handle annually at its $20-million facility within a year. “Frankly, we underestimated demand,” says Carl Boivin, CanEst’s general manager. “Our strategic partnerships, particularly with AGT Foods, led to us basically doubling our volume in each of our three years in operation.” As a result, CanEst has invested another $6.5 million (which included $1.5 million obtained through Quebec’s Maritime Strategy funding) to increase capacity by 200,000 metric tons to more than 500,000 metric tons. “The improvements additionally give us more flexibility in handling different crops simultaneously,” Boivin says. “It will also provide faster unloading with the ability to handle up to 135 railcars at a time as of this summer.” CanEst anticipates reaching full capacity within two years as a result of AGT Foods becoming its equity partner last July. AGT Foods singled out the 60,000 metric tons of storage, the port’s unique ability to receive 100unit trains to transload into containers, as well as the location at tidewater to facilitate overseas shipments among the reasons for investing in the longterm equity stake. Boemi noted that the port is becoming an increasingly attractive choice because it is conveniently located en route to and from several East Coast stops,
rarely experiences traffic congestion, and is an ideal transshipment location. “A lot of grain, particularly high-quality durum, is being transshipped to the Mediterranean, France and Northern Europe, from our port.”
Thunder Bay grain up on average 34% The port of Thunder Bay, the largest export port on the Great Lakes-Seaway, has also seen significant grain tonnage increases in recent years. Prior to the elimination of the Canadian Wheat Board monopoly, average annual grain shipments totaled 5.8 million metric tons. Post wheat board, the four-year average for annual volumes to the port is 7.8 million metric tons, 34 per cent higher. “Tremendous capacity and proven efficiencies at the port’s elevators have enabled the capture of greater market share,” says port authority chief executive officer Tim Heney, “following regulatory change that brought free movement to the Canadian grain transportation flow.” “The grain is up and that level is going to stay. I think there’s a lot of potential for more depending on the size of the harvests, which tend to be growing larger every year,” Heney says. “We can easily handle larger capacities of grain and pulses without any congestion issues.” Grain shipments at Thunder Bay totaled 7.3 million metric tons in 2017. The port anticipates a fast upswing
when it reopens in March 2018 with larger-than-usual grain stocks in port in late 2017.
Carbon tax could raise Seaway profile Heney acknowledges that agri-food companies currently rely on westbound rail to move the vast bulk of Prairie crops but anticipates several factors will lead to them look more at Thunder Bay, including the carbon tax. “Nothing comes even close to ships in terms of the small amount of fuel used to transport goods per tonne/mile,” Heney says. “The carbon tax program recognizes this, which might help to raise the Seaway’s profile.” A diversification of crops that includes lentils destined for Algeria and chickpeas and other pulses for the Middle East, India and North Africa likewise favours Thunder Bay. “It makes more sense to transport these smaller shipments through the Seaway than to send them out West by rail to load onto Panamax vessels,” Heney explains. Heney is likewise hopeful that Canada’s free trade agreement with Europe - in effect since last fall - will result in more shipments heading along Eastern routes. n
Photo: Thunder Bay Port Authority
News Updates
WESTERN PRAIRIE AND CENTRAL CANADIAN FARMERS RELY ON THIS IMPORTANT TRANSPORTATION CORRIDOR FOR EXPORTS TO MEXICO, EUROPE, THE MIDDLE EAST, AFRICA AND EVEN ASIA.
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