Special crops shippers may soon face more competition for an already limited supply of container cars.
One of the biggest commodity shippers in Western Canada is becoming increasingly interested in delivering a portion of its product to overseas customers using that mode.
“There is potential for us to go into the container market to fill containers to go to Asia,” said Neil Townsend, market analyst at the Canadian Wheat Board.
He said one-third to one-half of the metal containers that arrive in North America from Asia loaded with consumer goods head back empty.
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The CWB feels it can take advantage of that inefficiency by snapping up containers on the cheap and loading them with wheat and barley destined for customers looking for smaller specialty orders or identity preserved products.
“I think we’re starting to look into that in terms of organics and other things,” said Townsend.
The wheat board will remain largely a bulk shipper, but it also wants to take advantage of new ports being constructed in places such as China and Korea that focus on container handling.
Special crops shippers have been using container cars for years. They are suited to an industry where hundreds of small processors are shipping to different customers around the world with different specifications.
But exporters have had difficulty convincing owners of the metal boxes to route empty containers to the prairie region where they could be loaded with low-value crops for the return trip to Asia.
The container car shortage is an issue the Canadian Special Crops Association has identified as its top priority.
But Murad Al-Katib, transportation chair of the CSCA, isn’t overly concerned about the CWB’s growing interest in containerized grain movement.
“I definitely don’t think there’s a lot of downside,” he said.
While he acknowledged it could further restrict container supply in the short term, the added demand will likely have some long-term benefits.
Al-Katib said any increase in demand for container cars should pique the interest of the shipping lines. Eventually, if there is enough demand from the Prairies, it could lead to dedicated unit trains of containers coming here.
His only concern is that demand from the board has to be consistent and reliable, which has been a problem in the past.
“They’re interested when bulk freight is up but the minute the bulk freight goes down, they’re not interested.”
