News

Published Date : 2022-08-31

Monday’s opening of a road-rail corridor that will streamline truck haulage in Prince Rupert without increasing traffic in the local community is seen as another step in an effort to attract more export and import transloading operations that the western Canadian port hopes will significantly boost its cargo volumes.

The Fairview-Ridley Connector Corridor, with a private freight roadway and rail sidings, will reduce the drayage distance from the existing transloading facilities to the port’s marine terminals from 12.4 miles to 3.4 miles while diverting the truck trips away from the community’s streets, according to Brian Friesen, vice president of trade development and communications at the Prince Rupert Port Authority (PRPA).

Daily truck traffic generated by the port has grown from a few trips 15 years ago to several hundred today.

“The road and rail corridor directly links Fairview Terminal, both current and future capacity, with future import and export logistics sites … that will offer new opportunities for Canadian businesses to reach global markets through containerized trade,” the PRPA said in a statement.

Prince Rupert has three transloading facilities where forest and agricultural products and plastic pellets are received in bulk cars on the Canadian National Railway and then transloaded into marine containers for export. Exports have increased from virtually none when the port opened in 2007 to more than 30 percent of its total laden container volume today, Friesen said.

Construction is scheduled to begin next year on a large export transloading facility to serve multiple tenants. Exports are expected to “explode” within the next few years to account for half of Prince Rupert’s total container volume, Friesen said.

Port to develop new import transloading facility

The port in the next few years also plans to develop an import transloading facility where laden import marine containers will be transloaded into 53-foot domestic containers that CN will carry to destinations in eastern Canada and the US. The empty marine containers will then be filled with export commodities at the export transload facilities.

“It will all happen behind the port fence,” Friesen said. “There will be no impact on the community.”

Through the first seven months of 2022, Prince Rupert handled 599,659 laden and empty TEU, down 2 percent from the first seven months of 2021, according to port statistics. The port handled 1.14 million TEU all of last year.

The port’s Fairview container terminal in September will be expanded to an annual throughput capacity of 1.65 million TEU from 1.35 million TEU at present.

https://coh.oss-cn-shenzhen.aliyuncs.com/upload/attachment/2022/08/31/image002_0882ff24504646d896a44491d0082657.jpg

Monday’s opening of a road-rail corridor that will streamline truck haulage in Prince Rupert without increasing traffic in the local community is seen as another step in an effort to attract more export and import transloading operations that the western Canadian port hopes will significantly boost its cargo volumes.

The Fairview-Ridley Connector Corridor, with a private freight roadway and rail sidings, will reduce the drayage distance from the existing transloading facilities to the port’s marine terminals from 12.4 miles to 3.4 miles while diverting the truck trips away from the community’s streets, according to Brian Friesen, vice president of trade development and communications at the Prince Rupert Port Authority (PRPA).

Daily truck traffic generated by the port has grown from a few trips 15 years ago to several hundred today.

“The road and rail corridor directly links Fairview Terminal, both current and future capacity, with future import and export logistics sites … that will offer new opportunities for Canadian businesses to reach global markets through containerized trade,” the PRPA said in a statement.

Prince Rupert has three transloading facilities where forest and agricultural products and plastic pellets are received in bulk cars on the Canadian National Railway and then transloaded into marine containers for export. Exports have increased from virtually none when the port opened in 2007 to more than 30 percent of its total laden container volume today, Friesen said.

Construction is scheduled to begin next year on a large export transloading facility to serve multiple tenants. Exports are expected to “explode” within the next few years to account for half of Prince Rupert’s total container volume, Friesen said.

Port to develop new import transloading facility

The port in the next few years also plans to develop an import transloading facility where laden import marine containers will be transloaded into 53-foot domestic containers that CN will carry to destinations in eastern Canada and the US. The empty marine containers will then be filled with export commodities at the export transload facilities.

“It will all happen behind the port fence,” Friesen said. “There will be no impact on the community.”

Through the first seven months of 2022, Prince Rupert handled 599,659 laden and empty TEU, down 2 percent from the first seven months of 2021, according to port statistics. The port handled 1.14 million TEU all of last year.

The port’s Fairview container terminal in September will be expanded to an annual throughput capacity of 1.65 million TEU from 1.35 million TEU at present.

 

Published Date : 2022-08-19

Canadian National Railway (CN) is shuttling laden import containers from the ports of Vancouver and Prince Rupert to auxiliary storage yards in the eastern half of Canada to help clear the backlog of marine containers that has accumulated at the West Coast ports.

Yet the new storage, which CN says is already speeding up freight delivery, is adding to incremental costs for intermodal shippers already dealing with rising per diem fees and chassis and driver shortages in eastern Canada.

In a statement to JOC.com, CN said the opening of additional yard space in Toronto and Montreal is the result of requests from the country’s transport ministry, the ports, and trade groups looking to relieve “the surge of Canadian imports that are dwelling on dock or on an anchored vessel on the West Coast.”

Inland bottlenecks, most notably a lack of drayage capacity and chassis in Toronto and Montreal, have resulted in higher rail dwells at Prince Rupert and Vancouver, slowing the inland movement of imports since last summer. Average dwell times for rail containers at Vancouver terminals exceeded seven days in the first week of August, about the same as in late June, according to data from the Vancouver Fraser Port Authority. Dwells of longer than three days cause congestion problems, according to terminal operators.

In response, CN has started moving marine containers to one of four “relief” yards — two existing CN intermodal terminals in Mississauga and Valleyfield, near Montreal, and two third-party operated sites in Brampton and Mississauga — according to a Maersk customer advisory posted Tuesday. CN did not specify which containers, nor under what circumstances, freight would be diverted to one of the relief yards.

Effective Aug. 9, CN will charge shippers a shuttle fee of $300 per container for boxes moved to these relief yards, except for the Valleyfield yard, which will cost $550. Shippers will have one day of free time at the facilities, per the Maersk notice, which did not specify what demurrage charges would accrue after the expiration of free time.

CN said the fees cover the cost of operating the yards, adding that in helping to alleviate the backlog in Vancouver and Prince Rupert, the railroad has “moved containers as close as possible to their intended destinations.”

“The fees help offset the costs associated with that effort, especially in the context of a resource shortage of drayage and warehousing,” CN said in the statement. “The results of these efforts have been successful which, in turn, has decreased vessels at anchor as well as ground counts at the container terminals.”

New fees compound truck, chassis shortages

The CN shuttle fee comes ahead of other new costs facing intermodal shippers. Canadian Pacific Railway (CP) issued a new tariff effective Aug. 26 that raises demurrage for marine containers that linger at 11 of the railroad’s Canadian and US ramps.

The increases range from $75 to $125 per day for the first three days of storage past free time. Demurrage for subsequent days will increase by $75 to $275 per day, according to the notice.

CP said in a statement to JOC.com the tariffs were changed “to encourage customers to pick up containers in a timely manner to create more supply chain capacity for all stakeholders. We expect these changes to improve fluidity at those terminals.”

Bruce Rodgers, executive director of the Canadian International Freight Forwarders Association (CIFFA), told JOC.com the association’s members not only face the new shuttle fee, but additional trucking and demurrage costs if their freight gets diverted to the relief yards.

“This change has resulted in additional costs due to moving the containers between yards, splitting of shipments, and storage charges due to inability to obtain reservations,” Rodgers said.

In addition to the western Canada port backlog, a lack of truck and chassis capacity on the receiving end has exacerbated congestion at the eastern rail ramps, Chris Ford, who chairs CIFFA’s drayage practice, told JOC.com. He added that Canada’s largest chassis manufacturer won’t be able to deliver enough equipment to relieve the deficit for another year.

“There is little to no drayage capacity in Ontario, little to no container storage capacity in Ontario, and there is a container chassis shortage in Ontario,” Ford said. “The situation is a mess.”

https://coh.oss-cn-shenzhen.aliyuncs.com/upload/attachment/2022/08/17/image001_e6d4166ac47b4c38ae336949b1a61b6d.jpg

Canadian National Railway (CN) is shuttling laden import containers from the ports of Vancouver and Prince Rupert to auxiliary storage yards in the eastern half of Canada to help clear the backlog of marine containers that has accumulated at the West Coast ports.

Yet the new storage, which CN says is already speeding up freight delivery, is adding to incremental costs for intermodal shippers already dealing with rising per diem fees and chassis and driver shortages in eastern Canada.

In a statement to JOC.com, CN said the opening of additional yard space in Toronto and Montreal is the result of requests from the country’s transport ministry, the ports, and trade groups looking to relieve “the surge of Canadian imports that are dwelling on dock or on an anchored vessel on the West Coast.”

Inland bottlenecks, most notably a lack of drayage capacity and chassis in Toronto and Montreal, have resulted in higher rail dwells at Prince Rupert and Vancouver, slowing the inland movement of imports since last summer. Average dwell times for rail containers at Vancouver terminals exceeded seven days in the first week of August, about the same as in late June, according to data from the Vancouver Fraser Port Authority. Dwells of longer than three days cause congestion problems, according to terminal operators.

In response, CN has started moving marine containers to one of four “relief” yards — two existing CN intermodal terminals in Mississauga and Valleyfield, near Montreal, and two third-party operated sites in Brampton and Mississauga — according to a Maersk customer advisory posted Tuesday. CN did not specify which containers, nor under what circumstances, freight would be diverted to one of the relief yards.

Effective Aug. 9, CN will charge shippers a shuttle fee of $300 per container for boxes moved to these relief yards, except for the Valleyfield yard, which will cost $550. Shippers will have one day of free time at the facilities, per the Maersk notice, which did not specify what demurrage charges would accrue after the expiration of free time.

CN said the fees cover the cost of operating the yards, adding that in helping to alleviate the backlog in Vancouver and Prince Rupert, the railroad has “moved containers as close as possible to their intended destinations.”

“The fees help offset the costs associated with that effort, especially in the context of a resource shortage of drayage and warehousing,” CN said in the statement. “The results of these efforts have been successful which, in turn, has decreased vessels at anchor as well as ground counts at the container terminals.”

New fees compound truck, chassis shortages

The CN shuttle fee comes ahead of other new costs facing intermodal shippers. Canadian Pacific Railway (CP) issued a new tariff effective Aug. 26 that raises demurrage for marine containers that linger at 11 of the railroad’s Canadian and US ramps.

The increases range from $75 to $125 per day for the first three days of storage past free time. Demurrage for subsequent days will increase by $75 to $275 per day, according to the notice.

CP said in a statement to JOC.com the tariffs were changed “to encourage customers to pick up containers in a timely manner to create more supply chain capacity for all stakeholders. We expect these changes to improve fluidity at those terminals.”

Bruce Rodgers, executive director of the Canadian International Freight Forwarders Association (CIFFA), told JOC.com the association’s members not only face the new shuttle fee, but additional trucking and demurrage costs if their freight gets diverted to the relief yards.

“This change has resulted in additional costs due to moving the containers between yards, splitting of shipments, and storage charges due to inability to obtain reservations,” Rodgers said.

In addition to the western Canada port backlog, a lack of truck and chassis capacity on the receiving end has exacerbated congestion at the eastern rail ramps, Chris Ford, who chairs CIFFA’s drayage practice, told JOC.com. He added that Canada’s largest chassis manufacturer won’t be able to deliver enough equipment to relieve the deficit for another year.

“There is little to no drayage capacity in Ontario, little to no container storage capacity in Ontario, and there is a container chassis shortage in Ontario,” Ford said. “The situation is a mess.”

 

Threats of port disruptions saw volumes brought forward to the first half of the year. Even with an expected easing in the second half, import volumes will still exceed 2021

US CONTAINERISED imports are likely to see a net gain compared with last year, despite an expected slowdown in volumes in the second half of this year as the economy cools.

“Retail sales are still growing, but the economy is slowing down and that is reflected in cargo imports,” said National Retail Federation vice-president Jonathan Gold.

Data from the NRF and Hackett Associates showed that US ports handled 2.3m teu in June, the latest month for which figures are available. 

That was a 5.9% decline on the record 2.4m teu volumes imported in May but remains 4.9% above the corresponding month last year.

June’s results brought the first half of the year to 13.5m teu, a 5.5% increase year on year.

“The heady days of growth in imports are quickly receding,” said Hackett Associates founder Ben Hackett. “The outlook is for a decline in volumes compared with 2021 during the next few months, and the decline is expected to deepen in 2023.”

While numbers for July are not finalised, they are expected to see 3.2% increase over 2021, before the tide turns in August with a 3% year-on-year decline. The remaining months of the year are forecast to be between static or down on last year. 

Final numbers for the second half of the year are forecast at 12.8m teu, down 1.5% on the second half of 2021, while the full year will still come out 2% higher at 26.3m teu.

The NRF said that volumes had been front-loaded this year as shippers sought to avoid potential disruptions caused by the expiration of the US west coast labour contract on July 1, with early shipments driving second-quarter volumes. 

“Lower volumes may help ease congestion at some ports, but others are still seeing backups and global supply chain challenges are far from over,” said Mr Gold. “Our biggest concern is the potential for disruption because of separate labour negotiations at the west coast ports and the freight railroads. Concluding both sets of negotiations without disruption is critical as the important holiday season approaches.” 

News from Lloyd’s List by James Baker