Prairie farmers aren’t the only ones praying for a good crop in 2003.
The people who make a living moving grain through the eastern waterway system are also desperately hoping that production – and grain movement – will bounce back in 2003.
“If we had to weather a third bad year in a row, it would be a real disaster,” said Dennis Johnson, chief executive officer of the Thunder Bay Port Authority. “I can’t even comprehend the result.”
Port operators, grain handling companies, elevator workers, vessel owners, sailors, marine suppliers and St. Lawrence Seaway employees all have a financial stake in how much grain is moved by water to domestic buyers and overseas customers.
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“There is a lot of finger-crossing going on,” said Jim Campbell, vice-president and general manager of the Chamber of Maritime Commerce, an Ottawa-based lobby group representing most of those stakeholders.
“Everyone got burned the last couple of years, most importantly the farmers, but that has an impact all the way through the system.”
For example, reduced grain shipments mean fewer vessels are available to backhaul iron ore to steel mills in Ontario and the U.S., which means higher shipping rates for steel manufacturers.
“The livelihood and future health of the seaway is very closely tied to the western Canadian farmer,” said Campbell.
No one knows how this year’s crop will turn out and what the demand for shipping will be in autumn, but one thing that’s certain is that not much grain will move during the first few months of the 2003 navigation season.
The Canadian Wheat Board, the seaway’s biggest grain shipper, expects to ship only 1.0-1.5 million tonnes of wheat and durum through the eastern waterway system during the final four months of the 2002-03 crop year (April 1 to July 31).
As of the end of March, wheat and durum shipments through Thunder Bay totalled 1.6 million tonnes. Total movement, including non-board grains such as flaxseed and oats, was 2.6 million tonnes.
If the board’s projections for the rest of the crop year are correct, and if shipments of other grains continue at a similar pace, then total eastbound shipments for the 2002-03 crop year will end up at 2.9-3.4 million tonnes.
That would make it the worst year in the 50-year history of the Seaway system. The previous low was 5.2 million tonnes in 1988-89, following the 1988 drought.
Shipments have averaged 6.4 million tonnes annually over the past five years.
“I would never have thought five years ago that I’d be looking forward to getting back to six or 6.5 million tonnes again, but I am now,” said Johnson.
Back in the port’s heyday in the early 1980s, annual shipments out of Thunder Bay routinely exceeded 15 million tonnes.
However, changes in world grain demand during the past decades, in particular the loss of the former Soviet Union market and reduced sales to Europe, resulted in a shift in Canada’s export program to the West Coast.
Grain companies have closed Thunder Bay terminals over the past decade, and the number of full-time grain workers at the port has dropped accordingly, from a high of 1,500 to 350 last year.
Poor prairie crops in the last couple of years have only added to the port’s woes.
“We still have huge overcapacity,” said Johnson. “We’ve got all these terminals here and I don’t see how they can sustain themselves if we have another bad year.”
