Outside Rob Paterson’s office window is a scene that symbolizes the decline of Thunder Bay, Ont., as a Canadian grain port.
Since 1991, an N.M. Paterson and Sons Great Lakes cargo ship has been tied up, waiting for the day when grain volumes increase enough to warrant its use again.
Paterson, chief executive officer of his company’s marine division, isn’t holding his breath waiting for that day.
“We have seen a gradual decline here and that isn’t a good thing,” he said. “There was a time when we were busy. In the 1960s, Paterson had 40 ships. Now we run four.”
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This is a city where symbols of the declining grain trade are everywhere.
On the wharves, empty and decrepit grain terminals stand as silent sentinels, stark memories of earlier glory years.
In the working elevators, the staff is barely an echo of what it was in the 1980s.
“In the heyday, we had up to 1,800 or 2,000 full- and part-time (employees) in the busy season,” said Herb Daniher of the United Steelworkers of America, the union that represents grain handlers. “Now, we really can’t keep 350 working and that is falling.”
At city hall, Thunder Bay mayor Ken Boshcoff has watched tax revenues from the grain terminals dwindle. On occasion, the city has paid to demolish abandoned terminals that had fallen into a state of disrepair.
“There is no doubt this grain decline has had a financial impact on us,” Boshcoff said in late October, during a municipal election campaign that focused on the need to renew Thunder Bay’s once-vibrant economy.
And for longtime employees, memories of the good old days are a constant reminder of the industry’s decline.
Don Hutsul started to work for Saskatchewan Wheat Pool in 1971, shoveling grain out of box cars. This month he takes early retirement, glad to be leaving a job that these days features more layoff days than working days.
“In the 1980s, I remember days when there’d be 21 ships waiting,” he said. “Now, you are lucky to get 21 in a month.”
Grain handling numbers compiled by the Canadian Grain Commission tell a compelling story.
After the St. Lawrence Seaway opened in 1959, grain traffic through Thunder Bay shot up from 7.4 million tonnes to 11 million tonnes by 1965.
With some yearly variations, the traffic grew to 12 million tonnes by 1970.
By 1980, nearly 15 million tonnes of grain passed through the port and by 1983, traffic peaked at 17.6 million tonnes.
Since then, it has been all downhill. Last year, less than seven million tonnes of grain moved eastward from Western Canada through Thunder Bay. Grain traffic fell to pre-Seaway levels.
The explanation of what happened at Thunder Bay is both simple and complex.
In the past two decades, the Asian market has grown, the Soviet Union has disintegrated and Canada’s grain exports have shifted west.
In the 1980s, the Thunder Bay versus West Coast split in grain handling was 60-40. Today, that split has more than reversed.
After 1983, the crumbling Soviet Union was no longer an acceptable credit risk for Canadian grain sellers and the U.S.S.R. could not afford to buy Canadian grain with cash.
“The single biggest reason is the collapse of the Soviet Union and the market in eastern Europe,” said Thunder Bay transportation consultant and former NDP MP Iain Angus. “There simply is nothing we could do about that.”
But local officials also cite domestic factors that could have been avoided.
Among some stakeholders, there is a perceived federal bias in favor of keeping the port of Churchill alive at the expense of Thunder Bay.
“Putting federal money into Churchill is at our expense,” said union representative Daniher. “They have created artificial competition for us.”
Growing seaway costs have made the eastern waterway a less competitive alternative to direct rail or shipping south through the United States.
And federal legislation in the mid-1990s made eastward shipment of grain more expensive by moving the eastern pooling point into the lower St. Lawrence.
At Lakehead University, transportation expert Norman Bonsor said even if grain volumes had not declined as much, city employment in the grain trade would have tumbled.
“A lot of the employment loss would have happened anyway because the companies have simply become more efficient.”
The result is a city that has taken some hard economic hits. Well-paid union jobs have been replaced by lower-paying call centre jobs and a local casino.
Still, Boshcoff is optimistic the Great Lakes port will remain an important piece in the Canadian grain export puzzle.
In recent years, two new bulk elevators geared to handle unit trains have started. Specialty crops are also accounting for a larger part of the traffic.
And Thunder Bay remains a port with good facilities, a skilled workforce and direct access to potential African and European markets.
“Thunder Bay still sees itself as the gateway to the West,” he said. “We feel optimistic that if we continue to work with the grain companies, the railways, the wheat board, the seaway, and if they sell us as an efficient port, we will do well.”
At the steelworkers’ office, Daniher also is optimistic, but in a subdued way. He figures the workforce is on the way down to 200, but then it will stabilize.
“It could have been zero so that’s good news,” he said. “I think we’ll always handle grain here.”
