CN to Improve Service for Shippers Through New Intermodal Agreements

(DC Velocity – Toby Gooley)

Canadian National Railway (CN), the Montreal-based railroad that has worked in recent years to improve productivity and shorten transit times, is extending that approach to its seaport partners through a series of new “service level agreements.”

In addition to establishing key performance indicators (KPIs) and measurement tools, the agreements formalize the tracking, electronic sharing, and application of the resulting data, CN said.

The aim of the service agreements is to increase coordination among the railroad, ports, terminal operators, and ocean carriers, according to Jean-Jacques Ruest, CN’s chief marketing officer. Ruest delivered the keynote address at the recent American Association or Port Authorities (AAPA) 99th Annual Convention in Halifax, N.S. Some 700 port professionals from throughout the Western Hemisphere attended the event. Read more here.

Related: Let’s hope CN’s pact with Halifax port is a harbinger of improved service

Ministers Day and Baird Tour Port Facilities in British Columbia

(Transport Canada)

Today the Honourable Stockwell Day, President of the Treasury Board and Minister for the Asia-Pacific Gateway, and Canada’s Transport and Infrastructure Minister John Baird concluded their tour of port facilities in Kitimat and Prince Rupert, British Columbia.

“These ports are vital to boost trade between Canada and the growing economies of the Asia-Pacific region,” said Minister Day. “They provide Canada with a crucial edge in the competition among North American west coast ports for business with Asia. This is another example of the competitive economic advantage that our government is aggressively promoting.”

“Our visit was a great opportunity to see the investments our government is making to modernize and strengthen the ports in this region,” added Baird. “As demonstrated by today’s tour, our investments have paid off and helped attract more business.”

During their visit, both ministers toured the harbour facilities in Kitimat, where they saw first-hand why the area is increasingly recognized as a strategic hub to support Canada’s energy development in the northwest region. Kitimat industries have produced up to 12 per cent of British Columbia’s manufacturing GDP and currently export over $1 billion a year in manufactured products.

The visit continued at the Port of Prince Rupert, the second-largest deep-sea port on Canada’s West Coast and the deepest natural harbour in North America. With dedicated grain, coal, forest products, specialty grain and container-handling facilities, the port handled 12.2 million tonnes of cargo in 2009, up 15 per cent from the previous year. Shipping through the Port of Prince Rupert reduces steaming time between Asia and North America by two to three days and cuts a further one to two days off the dwell time at the container port, resulting in a three- to five-day time saving (over a normal 17-day trip). From Prince Rupert, rail links can quickly transport goods right into the heart of North America.

Operations at the Port of Prince Rupert and the Port of Kitimat contribute to the economic well-being of these communities. An economic impact study released by the Port Rupert Port Authority demonstrated that, as of October 2009, the port was a significant economic generator, with direct employment related to operations totalling 1,500 jobs.

While in Prince Rupert, the ministers toured the Fairview Container Terminal. They also visited Ridley Terminals, a federal Crown corporation that operates a bulk handling terminal for the efficient and reliable movement of coal and other bulk commodities.

Canada’s Asia-Pacific Gateway is a system of transportation infrastructure that includes British Columbia Lower Mainland and Prince Rupert ports, road and rail connections that reach across Western Canada and into the economic heartland of North America, as well as major airports and border crossings. Since 2006, the Government of Canada, through its Asia-Pacific Gateway and Corridor Initiative, has partnered with B.C. and other western provinces, municipalities and the private sector to undertake strategic infrastructure projects worth more than $2.8 billion, including federal contributions of over $1 billion.

U.S. Ports Expand Capacity to Meet Growing Demand

(Logistics Today)

As global trade begins to rebound, U.S. ports are looking to expand capacity to meet the anticipated demand and are focusing on capital development to meet the infrastructure need, according to a recent study by Jones Lang LaSalle.

“Between 2007 and 2009, the nation’s top 13 ports witnessed an 18.5% decline in total volume as both domestic and foreign consumption waned,” notes John Carver, head of the Ports Airports and Global Infrastructure group at Jones Lang LaSalle. “Fortunately, transpacific U.S. bound trade from Asia started to recover in the second half of 2009 and has started to show a positive impact on West Coast ports, with traffic up 14.8% year-over-year.” Read more here.

N. America’s Empty Ports to Get Busier as Year Ends – Analyst

(Wall Street Journal – Laura Mandaro)

The sharp drop in container volume at North America’s largest ports is likely to moderate toward year-end as consumer demand picks up for boxed goods like TV sets and sneakers, says a forecasting firm. IHS Global Insight, which estimates the volume of inbound container shipments at about a dozen U.S. and Canadian ports, expects volumes to fall at a slower pace as the year winds down and to even flatten.

“By the fourth quarter there will be signs of a turnaround. We will have stopped declining in terms of volume,” said Paul Bingham, managing director in global commerce and transportation at IHS Global Insight.

Supporting forecasts for a recovery is the recent improvement in consumer sentiment surveys that suggest households will buy more of the manufactured goods that Asia exports to the U.S. and Canada on large ocean-going ships, he said. Read more here.

Canadian Ports Call U.S. Allegations They’re Receiving Subsidies ‘Hogwash’

(The Canadian Press – Brenda Bouw)

Canada’s port operators are scratching their heads at allegations coming from south of the border that they are receiving government subsidies that may contravene international trade rules, calling the complaints yet another U.S. protectionism measure.

Gary Leroux, executive director of the Association of Canadian Port Authorities, accused in turn the U.S. ports of being awash in government money. “It just boggles the mind that that kind of assertion can be made, under the WTO especially... I think the reverse might be in order,” Leroux said in an interview Tuesday. “It’s hogwash. Canadian ports are cash cows and the U.S. ports are recipients.”

Leroux was commenting on allegations that surfaced this week from the U.S. ports that Pacific ports in Vancouver, and Prince Rupert, B.C., in particular, are taking business away from their American competitors thanks to allegedly illegal government subsidies which are against World Trade Organization rules.

Leroux said while money has been spent on upgrading road and rail links to the B.C. ports, the U.S. ports receive several types of government funding from infrastructure dollars to low-interest bonds and through the collection of municipal taxes. Read more here.

U.S. Ports Take Aim at B.C. Rivals

(The Globe and Mail – Steven Chase and Patrick Brethour)

Both sides make subsidy accusations; American port authorities want Washington to take issue to WTO

Canadian ports are being targeted by U.S. rivals as trade rule scofflaws benefiting from illegal government subsidies – part of a mounting wave of American protectionism as the global recession hammers shipping traffic.

U.S. port officials yesterday brought their complaints against Canada to the Office of the United States Trade Representative, making the case that government help for ports such as Vancouver is partly to blame for a decline in business at American terminals.

“We’re playing Paul Revere on this, but it’s the Canadians, not the British, who are coming,” Port of Long Beach commission president Jim Hankla told Bloomberg News in Washington yesterday.
California’s Long Beach, the second-busiest port in the U.S., has seen container traffic drop by more than 40 per cent from an August, 2006, peak – a decline Mr. Hankla said is largely due to the downturn but can be partly blamed on Canadian investments that diverted cargo from American facilities.

In a draft memo prepared for the Washington visit, a Long Beach port official argued that Canadian governments’ spending on rail and port infrastructure constitute illegal subsidies under the World Trade Organization, a global trade referee. Read more here.

Winnipeg to Become a Massive “Inland Port”

(Canadian Consulting Engineer)

The Government of Manitoba has introduced legislation to build a huge “inland port” around Winnipeg's international airport. The idea of CentrePort Canada is to take advantage of the city's location close to the geographic centre of North America. Winnipeg is located on the International Mid transportation corridor, which gives access by road and rail south into the U.S. and Mexico via the Emerson Border. To the west are routes into Asia via the ports of Vancouver and Prince Rupert, while to the northeast lie air cargo routes over the North Pole to Europe.

The CentrePort Canada Act enables the creation of a corporation to develop and run the port on 20 acres of land northwest of the James Armstrong Richardson International Airport. The inland port would be a massive trucking and rail depot, as well as having private distribution centres, warehouses and manufacturing plants.

Prime Minister Stephen Harper committed $100 million in federal funds to help develop the port when he was touring the province to observe flooding in the area in April. The total cost is estimated at $212 million. One of the first jobs is to build a four-lane expressway to link the port to the airport.

Canada Post is already building a new mail distribution plant east of the airport on 11 hectares of land.

Port Effectiveness Research

(Port Performance Research Network)

Do you think ports are effective in meeting your needs?

Tell us where they are effective and where their performance falls short.

The Port Performance Research Network (PPRN), chaired at Dalhousie University, is working to identify and evaluate the key components of port effectiveness in delivering port services to port users. We want to understand how port users evaluate ports, what is most important to port users in terms of the services received, and how you evaluate the performance of ports you use. In this study, participants are asked to rate the importance of various performance criteria and then to apply them to ports they use. This survey is being piloted in Canada. When this research is completed, the PPRN will be implementing a port satisfaction survey that will be used throughout the world to evaluate port performance in meeting customer needs. This should guide ports in improving the quality of their services, which will be a significant benefit to the companies who use ports. We have designed this survey to be as short as possible while still capturing the important factors companies consider when evaluating ports.

If you are interested, and have personal experience with port usage in the last year, take 15-20 minutes (time depending on the extent of your usage) and visit the study web site and participate. We will let you know about the research via industry media and a direct report if you contact us. All responses will be confidential and anonymous.

Deadline June 30, 2009

If you have any questions about this survey or want to be placed on an annual panel, please contact Mary Brooks at (902) 494-1825 or m.brooks@dal.ca.

Port Slowdown Idles Trucks, Ships

(Surrey Leader – Jeff Nagel)

Slowing international trade due to the global recession is translating into fewer cargo ships calling on Vancouver-area harbours and more port workers and truckers being sidelined. Port Metro Vancouver reported a 22% drop in the number of containers it handled in February compared to a year ago. And shipments of other types of bulk cargo are down 44% so far in the first two months of the year.

“The number of vessels is down,” said Port Metro Vancouver Chief Operating Officer Chris Badger. “Clearly if the consumer is not buying, the demand drops,” he said, adding that’s playing out in reduced imports of containerized goods from Asia.

There’s also been less demand for Canada’s outgoing commodities. The biggest declines so far in 2008 are exports of logs – down 62% – and bulk potash, off 80%.Grain and food exports through the port are bucking the downward trend so far, up 18% in the first two months of the year. “People still need to eat,” Badger said.

The port authority is projecting the decline will moderate later in the year, ending 2009 down about four per cent in general cargo and seven per cent for containers compared to 2008.

Badger says the drop this year doesn’t change the port’s long-term outlook or its need to expand to satisfy future projected demand. “The world will come out of this,” he said. “It’s about being positioned to take advantage of the uptake when it happens.” Read more here.

Labour Peace Secured with B.C. Port Workers; Truckers Still Negotiating

(Canadian Transportation & Logistics)

Labour peace has been achieved between the B.C. Maritime Employers Association (BCMEA) and the International Longshore and Warehouse Union (ILWU) Local 514, after a tentative agreement reached last month was signed by both parties.

“Representatives from the BCMEA and ILWU Local 514 met (on Friday), confirming their respective memberships have ratified the collective agreement in effect between April 01, 2007 and March 31, 2010,” said Greg Vurdela, vice-president marketing and information services, BCMEA.

The 450 ship and dock foremen with ILWU have been without a contract since March 31, 2007. There has been no comment by ILWU Local 514 during the negotiation process, or since the ratification vote. According to BCMEA, the main issue has been the cost of the contract.

However, labour peace has not yet been fully realized at Vancouver ports. Unionized truckers who haul freight at the Port of Vancouver have been without a contract since December 31, 2008, and negotiations have not been smooth. Read more here.

BC Ports Workers, Employers Ratify Collective Agreement

(Greg Joyce — Globe & Mail)

Negotiations were long and hard but there is now labour peace that will keep goods flowing at British Columbia ports.

The B.C. Maritime Employers Association and the International Longshore and Warehouse Union ratified a collective agreement that averted a costly strike threat.

“From our perspective clearly we had a majority of employers in favour of ratifying the agreement,” Greg Vurdela, spokesman for the employers association, said Saturday.

He didn't release voting figures and no one from the union was immediately available to comment.

“(Economic) figures released earlier indicate that for every day of a work stoppage in the ports of B.C. it is a cost of $124-million to the Canadian economy,” said Mr. Vurdela.

While the dispute involved only 450 workers, there were fears that as many as 5,000 other workers would walk off the job in support.

That could have crippled ports along Canada's Pacific Coast, and had already prompted as much as a fifth of shipping traffic to be diverted through the U.S. Read more here.

Tentative Deal Averts Strike at B.C. Ports

(CBC News)

About 450 B.C. dock workers have reached a tentative deal with an association representing about 67 port employers, averting a potentially crippling strike at the ports in Vancouver and Prince Rupert.

Local 514 of the International Longshore Warehouse Union reached a tentative agreement Friday with the British Columbia Maritime Employers Association, but the details won’t be released until members on both sides have time to see the deal.

If both sides approve it, the deal would avert a strike that would threaten to halt cargo traffic through B.C. There have been fears that as many as 5,000 other workers involved in port operations would walk off the job to show their support if the union went on strike.

Local 514 workers have been without a contract since March 2007, and had set a strike date of January 2, but continued to work while negotiations were underway.

The main issues on the table were reportedly pension payments and working conditions.

B.C. Port Labour Talks to Resume February 12

(Alberta Farmer – Alana Vannahme)

Federally appointed mediators have set February 12-13 as the next dates for contract negotiations between Local 514 of the International Longshore and Warehouse Union of Canada (ILWU) and the British Columbia Maritime Employers Association (BCMEA).

The two groups have been trying for months to draft a new collective agreement and avoid a strike at B.C.’s busy Lower Mainland, Vancouver Island and Prince Rupert ports. The local’s members, roughly 450 ship and dock foremen, have been without a contract since March 2008. Since then, efforts to reach a labour agreement have been unsuccessful, including an intense round of negotiations which began in December after the local threatened to issue a 72-hour strike notice at the beginning of January.

In the event of a strike, it’s expected that more than 5,000 other ILWU members would support Local 514 by joining the picket line.

Some companies that rely on the busy West Coast gateways to transport goods in and out of Canada have been diverting their freight away from B.C. since the threat of a strike in January first emerged. However, the January 26 resumption of the House of Commons following a seven-week suspension has taken some of the uncertainty out of the situation.

If a strike were to occur now, the union’s members could be legislated back to work by the federal government, a move they have supported in the past.

Vancouver Port Negotiations Continue Between ILWU, CAW

(Jan Westell — Canadian Transportation & Logistics)

Negotiations continue between the British Columbia Maritime Employers Association (BCMEA) and the International Longshore and Warehouse Union Local 514 (ILWU), who have been working for over three months towards a resolution.

The two parties met on Jan. 15, with the assistance of John Rooney, one of two federal mediators appointed to the discussions. At that time, the parties exchanged proposals and have agreed to meet on Jan. 23 at 9:30 a.m. “Further up-dates will be provided as significant events occur,” said Greg Vurdela, vice-president of marketing and information services for BCMEA. Read more here.

Carriers Divert Ships from Vancouver

(Pacific Shipper)

The diversion of container ships from Canada’s west coast Port Metro Vancouver has become “significant” as marathon collective bargaining continues between waterfront employers and union foremen.

Another in a series of day-long bargaining sessions between the British Columbia Maritime Employers Association and International Longshore and Warehouse Union Local 514 ended on January 9 with “some issues resolved – it was a positive thing, a cause for some optimism,” BCMEA Vice President Greg Vurdela said in an interview.

Talks were scheduled to resume on January 15 under federal mediation.While the bargaining has continued at a leisurely pace, with five and six days between meetings, the threat of a strike or lockout being called on three days’ notice has spurred nervous shipping lines to divert their vessels from Vancouver to regional rivals such as Tacoma and Seattle.

“Cargo in this atmosphere of uncertainty is clearly not coming to ports of British Columbia that would have been coming here,” Vurdela said. “That began in mid- to third-week- December, and it’s not just a few ships,” Vurdela said, without giving specific numbers. “It’s a significant number of ships, and it does have an economic impact.” Read more here.

Labour Dispute Threatens B.C. Ports

(CIFFA eBulletin – Financial Post)

The movement of goods through Canada’s West Coast ports could slam to a halt in the New Year if a festering labour dispute is not resolved soon. Workers at British Columbia ports in the Lower Mainland, Vancouver Island and Prince Rupert will be in a position to strike beginning January 2. Port officials say imports and exports of all commodities – save grain, whose shipments are protected by law – will immediately halt if that happens. Negotiators for the British Columbia Maritime Employers Association and the International Longshore and Warehouse Union have spent the past 60 days working with a pair of conciliators. Those talks were expected to halt Tuesday night, which was set as a pre-established conciliation deadline, but were resume Wednesday morning at 10 a.m. in hopes the two sides can find some resolution.

Stephen Brown, the president of the Chamber of Shipping of British Columbia, expressed confidence that a labour disruption will be avoided. “Unemployment is on the increase throughout North America, so to take a major port down when [workers] have extremely high-paying jobs would be not a smart thing to do.” However, BCMEA President Andy Smith warned that talks are not going well. If a new contract is not signed by this weekend, when cargo bound for the West Coast starts loading in far eastern ports, international shipping lines will begin sending Vancouver-bound shipments elsewhere. “The significant Canadian and American shippers are saying, ‘if you don’t’ have a deal we’re going to have to start to divert now’,” Mr. Smith said. “So even if a deal is made between now and the second [ofJanuary], there will be as significant diminishing of business hitting the port.”

If workers do strike, the political upheaval in Ottawa could worsen an already bad situation. In previous waterfront strikes, the outcry from across the country has forced the federal government to order workers back to work. But with Parliament prorogued until January 27, “we wouldn’t have access to Parliament ordering us back until sometime probably in the second week of February,” Mr. Smith said…The Port of Vancouver alone moves $43-billion worth of goods a year, or $117-million a day. The current round of labour negotiations has been snagged on contract language surrounding pension payments and working conditions. Read the full article here.

It’s Full Steam Ahead for Port of Vancouver Expansion

(CBC News)

Metro Vancouver’s port authority is steaming ahead with a multibillion-dollar expansion despite the triple threat of a global financial crisis, increased competition and a slowdown in shipping traffic.

The port plans to spend about $4.5 billion over the next 10 years on a new terminal in Delta, and on the expansion of the existing container facilities and the possible expansion of the cruise ship terminal in Vancouver.

Port Metro Vancouver CEO Gordon Houston said he expects business will be down through much of next year, but that won’t change the port’s long-term plans. “When we put a piece of infrastructure in place, it’s there 100 years. It’s not a short-term business and we have a lot of confidence in the long term,” he said.

Houston said he doesn’t know how much business the port has lost, because the effects of the global economic slowdown are just starting to show up locally. “The shipping world is usually a few months behind economic events because it works on contract, but definitely the numbers are down,” said Houston.

Vancouver is competing with Los Angeles, Seattle and even Prince Rupert for dwindling shipping traffic, he noted. In June there weren’t enough ships to meet demand, said Houston. Now demand and rates have plummeted.

Port Metro Vancouver was created when the federal government amalgamated the three smaller local port authorities at the start of this year.

Vancouver Port Plans Big Spending for Expansion

(Journal of Commerce Online – Courtney Tower)

Port Metro Vancouver plans spending of just under C$1 billion to improve and expand operations between 2008 and 2018. The 10-year capital investment of $950 million, not including expected land acquisitions, is by the Vancouver Fraser Port Authority, known as Port Metro Vancouver, out of its own resources. The authority is owned by the Canadian government but gets no funds or subsidies from it.

Terminals and other cargo-related tenants of the port plan to spend an additional $3.2 billion on capital investments, in an overall spending plan by port tenants of $4.25 billion, according to a consultants’ report published Tuesday.

The report says some firms planning capital expenditures reported doing so “with the caveat that business continued to be ‘good.’ “That would mean that further investments depended on Port Metro Vancouver remaining competitive among the Ports of Seattle, Tacoma and Los Angeles.” Read the rest here.

The Government of Canada Will Invest Over $3.5 million in Prince George, B.C. Transportation Infrastructure

(Transport Canada)

The federal government, under the Asia-Pacific Gateway and Corridor Initiative, will invest a total of $3.5 million in two road projects in Prince George.

This represents a joint investment in excess of $7 million with the City of Prince George. Richard Harris, MP for Cariboo-Prince George, made the announcement today on behalf of the Honourable Lawrence Cannon, Minister of Transport, Infrastructure and Communities and the Honourable James Moore, Secretary of State (Asia-Pacific Gateway) (2010 Olympics) (Official Languages).

“Connecting North America and the Asia-Pacific more efficiently and reliably benefits local communities, the Canadian economy as well as Canada’s trading partners,” said Mr. Harris. “These projects will help relieve road congestion and make roads in our community safer.”

“The Government of Canada is committed to concrete measures that contribute to a more productive and competitive economy. The Asia-Pacific Gateway and Corridor Initiative is an important example,” said the Honourable James Moore.

“These projects will enhance transportation infrastructure safety and efficiency related to the movement of international trade through Canada’s Asia-Pacific Gateway and Corridor.”

Improvements to two concurrent sections of River Road were selected for funding, following a call for proposals.

The projects involve:

• upgrading of 1.9 km between Cameron Street Bridge and Foley Crescent; and

• widening of 1.7 km between Foley Crescent and the CN Fraser River Bridge and installing left turn lanes to access the CN facility.

River Road is the primary road access to CN’s Intermodal facility in Prince George and improving traffic flow along this corridor is essential to the community and the businesses that use this route.

“The Government of Canada has made the economic growth and competitiveness of northern British Columbia with Asia top priorities,” said Minister Cannon. “The Asia-Pacific Gateway and Corridor Initiative reflects the importance this government places in an integrated, safe, secure, and sustainable transportation system.”

On October 11, 2006, Prime Minister Stephen Harper announced the Asia-Pacific Gateway and Corridor Initiative (APGCI), with an initial investment of $591 million. A further commitment of $410 million was made in Budget 2007, bringing total federal funding for the APGCI to more than $1 billion.

In two years, the Government of Canada has partnered with British Columbia and other western provinces, municipalities and the private sector, to announce strategic infrastructure projects worth more than $2.4 billion, including federal contributions of almost $900 million.

Through its unprecedented $33-billion Building Canada plan, the Government of Canada will provide long-term, stable and predictable funding to help meet infrastructure needs across Canada. Federal funding for these projects is conditional upon the negotiation of contribution agreements, approval by the federal Treasury Board and completion of any applicable federal environmental assessments required under the Canadian Environmental Assessment Act.

CN Decision Couldn’t Have Come at Worse Time For Port

(Tom Peters—Chronicle Herald)

CN has announced it will reduce the number of trains serving the Port of Halifax from two to one, citing the decline in container cargo as the main reason.

The two trains were each running at less than 50 per cent capacity, so they will be combined. There will be one train with the same number of cars and with capacity for additional volume, according to CN spokeswoman Julie Senecal.

She says merging the two trains will have minimal impact on shipping times to Montreal, Toronto and Chicago. CN will discuss the move with its customers “in order to accommodate their specific needs, but CN sees no impact on import or export traffic over Halifax as a result of this change,” she said.

Calvin Whidden, general manager at Cerescorp, operator of the Fairview Cove terminal, is pretty much on track with CN’s thinking.

“My feeling is, with the volumes going through the terminals today, one train can handle them, but I can’t say if the shippers or lines have a concern,” he said.

CN’s decision couldn’t have come at a worse time for the port.

The reasoning behind the decision is understandable. But what kind of a message does this send to port customers and potential customers, both shipping lines and cargo owners? CN claims to be a strong partner of the port and says it is working hard with the port and others to develop more business. In that context, it is difficult to understand the cut.

And no matter how one tries to disguise it or talk around it, Halifax is a one-rail-line port. It’s a known fact in the global shipping industry and it has had an influence on decisions by shipping lines whether to include Halifax as a port of call. Whether having more than one rail line actually results in lower rates for shippers, only the shippers would know. But there is the perception two or more rail lines are better than one.

That is not in Halifax’s future.

In the meantime, Mr. Whidden is optimistic things will work out under the new CN schedule.

“I truly believe customers can be served by one train a day, providing CN ramps up when the business gets bigger, and we hope that is soon. But two half-trains equal one full train, and I’m hoping that’s as simple as it is,” he says. Read the complete article.