Port of Churchill supporters are celebrating the end of a shipping season some feared might never come, but in fact became one of the best ever.
“Altogether the thing has turned around,” said Lloyd Axworthy, chair of the port’s advisory board.
“There was a real crisis last spring.”
Axworthy warned in the spring that the port might not open in 2003.
But a better crop and an early harvest gave the port more grain to handle. And Axworthy said co-operation between governments, the port owner and major multinational grain company Louis Dreyfus resulted in better use of the port than in the past.
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Omnitrax, the U.S. company that owns the port, said Churchill needs to handle about one million tonnes of grain per year to be viable, and while this year’s haul will not be more than 700,000 tonnes, it is much closer to Omnitrax’s target than expected, Axworthy said.
In early 2003, Churchill’s prospects looked bleak. The port was financially starving because of two drought years in a row. In the 2002 shipping season only 279,000 tonnes of grain were shipped through Churchill, a big drop from 2001’s 478,000 tonnes and far below 2000’s record 711,000 tonnes.
The Canadian Wheat Board was warning that 2003 shipments could be even lower because of the small size of the 2002 crop in Saskatchewan. Churchill ships grain grown along a railway network that leads down from The Pas, Man., into northeastern and southern Saskatchewan.
Axworthy, on behalf of the advisory board, released a public letter in March calling on federal and provincial governments to support the port. It also called on the wheat board to ship more grain through the port.
Although the board reached an agreement with the port to ship some grain through Churchill, it committed far less than the 473,000 tonnes it actually shipped, said wheat board spokesperson Louise Waldman.
But the board’s extra tonnes had nothing to do with Churchill’s pleas, Waldman said. Instead, it was a dollars and cents decision.
“The 473,000 tonnes is not the result of political pressure. It’s the result of strategically using Churchill for maximum returns for farmers.”
If this summer’s crop hadn’t been so much larger than last year’s half crop, and if harvest hadn’t come early, Churchill might have had another bad year. Until the new crop started coming in, the board had shipped only 235,000 tonnes through the port. The early harvest of an average crop allowed the board to make early sales through Churchill, which has a shipping season that lasts only until October in most years.
Waldman said the board wants Churchill to survive so there are more available ports for farmers’ grain, but it is not willing to subsidize it.
“Our job is not to prop up an uneconomically viable alternate route,” she said.
“The reason we use Churchill as an alternate port is that it provides certain advantages (for some shipments).”
Shipping through Churchill can provide cheaper freight rates for grain buyers in Europe and Africa, two of the regions that bought Canadian grain through Churchill this season.
Ian Luff of Louis Dreyfus Canada, which was hired this year to market grain through Churchill, said using the Hudson’s Bay port was $10-$15 per tonne cheaper for some customers this summer and fall than using Thunder Bay and the St. Lawrence Seaway.
Axworthy credited Louis Dreyfus with not only being able to market grain more effectively than other marketers in the past, but also for giving the wheat board confidence that it could ship grain to Churchill and it wouldn’t be stranded there.
Last spring the wheat board defended itself against the accusation that it wasn’t using the port enough by pointing out that little non-board grain had moved through the port in recent years.
That changed this summer, with more than 100,000 tonnes of non-board grain moving through Churchill, including flax, canola and feed peas.
Axworthy was delighted to see a panamax Ð a giant cargo vessel Ð load feed peas in Churchill to ship to Europe.
The wheat board’s 10-year shipping average through Churchill is 335,000 tonnes. Combined with less than 200,000 tonnes of non-board grain, it comes nowhere near the port’s hope for one million tonnes of grain per year.
But Axworthy said this shipping season may have seen the turnaround.
“The issues of Churchill are still not over,” he said.
“I think there are still lots of things that need to be done. But this is a really good start.”
