GrainsWest Winter 2021

Winter 2021 grainswest.com 29 While new markets offer room for growth, overall volumes for containerized grain shipments have been fairly stable of late. “Containerized grain movement has almost tripled since 2000, but has stayed pretty constant over the last six years,” said Giles. “Prince Rupert went from zero to half a million tonnes last year as a new market, which has taken some shipments away from Vancouver. Even so, volume in Vancouver has been steady, coming in at about 2.6 million tonnes last year compared to 2.8 million the year before and 2.5 million tonnes in 2017.” The current year is shaping up as a tough one for this shipping method due to a lack of containers and the presence of cheap bulk rates, yet there’s no reason for alarm. INS AND OUTS, UPS AND DOWNS “I think the container business will always be there. It will just vary up and down depending on what bulk freight does and what happens with grain crops on the Prairies,” said Giles. “When grain volumes are down, the big companies shipping bulk will buy more as they have targets to hit, leaving less to be moved in containers, especially crops like peas, durum wheat and malt barley.” Sharing Giles’s optimism is Mark Hemmes, president of Quorum Corporation in Edmonton. Since 2001, his company has monitored Canada’s Prairie grain handling and transportation system. “Canadian grain movement in containers has increased from 2.5 per cent of total movement in 2001 to over 11 per cent last year, so its impact is significant,” said Hemmes. “Initially almost all of the product moving in containers was either malt barley or pulse crops, but it has expanded into some of the higher quality cereals and animal feed.” In his 2019 study Grain Movement in Containers , Hemmes found the cost of grain movement in hopper cars for transloading at port was close to the cost of loading in the country. Significantly, though, there are far more empty containers available at port locations than in the country. His study also noted that most container shipping lines were less inclined to hold empty containers on the Prairies on spec so as to load products. “When bulk commodities are exporting from Canada in containers, it is a backhaul for them [their revenue from import containers is far greater than export], so the sooner they get the asset back into a position to take a load from an Asian-Pacific country, say, the better for them,” said Hemmes. “Over time, railways also started to charge for the repositioning of empty containers, which pushed the economics of the move more in favour of transloading at port.” Regardless of the shipping method, Canadian grain exports are growing, and this presents its own set of challenges for industry and government. “The average shipper or farmer needs to understand that the port as a gateway to foreign markets has been growing, and we’ve invested in it at record levels for the last 15 years,” said Mills. “Total investment including government, port and stakeholders into gateway improvements has been over $7.5 billion in that period. The need for that growth is absolute moving forward, as grain exports are increasing at three per cent per year and that eats up a lot of capacity year over year, especially if you are talking about overall tonnage rates.” For its part, the Port Authority is calling for additional investment to be made in the years ahead so Canadian farmers can get their goods to market. To this end, Mills encourages farmers to speak up to their elected officials. “I would urge farmers to let politicians know that growing these gateways are important to them as far as continuing to meet their demands 10 years from now,” he said. “That type of infrastructure—including rail upgrades and supporting infrastructure such as crossings, bridges and overpasses, as well as terminal facilities—takes years to build and go through environmental assessments and community outreach. All the necessary steps don’t happen overnight, and the funding to make it happen needs to be available now. We must open up the future for our shippers and understand that we are enabling them to grow their business, and we want to keep doing that.” As an example of the hurdles faced by expansion projects, the Port Authority’s latest undertaking is the Roberts Bank Terminal 2 Project. A $2 billion offshore marine terminal in deep water, its location was designed to minimize environmental concerns. “We’ve been working at this project for over 10 years, and have been in the environmental assessment process for the last eight years, and still have not gotten approval,” said Mills. “It’s essential to advise Ottawa that infrastructure like this is vital to accessing containerized markets moving forward.” “I would urge farmers to let politicians know that growing these gateways are important to them as far as continuing to meet their demands 10 years from now.” —Doug Mills