By Chris Philips, Managing Editor
June 2010
Although British Columbia hosted the world for the 2010 Winter Olympics, the most important long-term visitors were the steamship lines which called at area ports in 2009 and the first quarter of 2010.
The Canadian Province’s northernmost port, the Port of Prince Rupert, continued its strong growth in both bulk and container volumes, handling 4,119,708 metric tons in the first quarter of 2010, up 72.8 percent compared to 2,383,510 metric tons in the same period in 2009. The increase in traffic was driven by a 217.9 percent jump in throughput at Ridley Terminals and an 84.3 percent increase at the Fairview Container Terminal. The first quarter performance follows the best year at the Port of Prince Rupert in 2009 since 1997.
Exports from Prince Rupert were strong as well, with export traffic through the Fairview Container Terminal growing 108.9 percent for the first quarter of 2010, allowing the terminal to post an overall 87.3 percent increase in traffic, to 76,860 TEUs, compared to 41,042 TEUs for January-March 2009. The Port attributes much of the growth in containerized export cargo to the backhaul of Western Canada resource-based commodities to China, including northern British Columbia lumber, logs and aluminum.
“The increase in Canadian exports demonstrates the value of the Prince Rupert Gateway to the northwest transportation corridor,” says President & CEO Don Krusel.
The strong export market for northern BC products is also generating new business and employment opportunities in the region including trucking and transloading operations.
To meet the increased volumes, Prince Rupert’s anchor container client, COSCO, has restored six 7,500-TEU vessel to the North China-U.S. Southwest Express Service Vessels to replace the six 5,500-TEU vessels currently serving the route.
The COSCO Yokohama is the first of the six to resume calling on Prince Rupert as part of the CEN Service the carrier operates as part of the CKYH Alliance along with “K” Line, Yang Ming and Hanjin. The Yokohama arrived in Prince Rupert April 26 as the first port of call from Asia before continuing on to US West Coast ports.
The port recorded strong grain volumes, with combined increases in canola, alfalfa pellets and grain pellets offsetting a decrease in wheat volumes, as Prince Rupert Grain Ltd. shipped 1,266,884 metric tons, up 621 mt, in the first quarter 2010 compared to the same period in 2009. Wheat was down 6.2 percent to 1,125,802 metric tons, while canola was up 82.7 per cent to 116,413 metric tons.
The Canadian Wheat Board, which disperses the agricultural products shipped through the ports of Prince Rupert and Vancouver, projects that exports for the 2009-10 crop year, which ends July 31, will reach 18.7 million metric tons of grain, its highest level of shipments in a decade. Prince Rupert Grain volumes in 2010 are expected to match its 2009 performance, one of its best years since 1997.
Prince Rupert’s Ridley Terminals Inc. is forecasting a record year for 2010, on the news of a posted 217.9 percent increase in volumes to 2,033,949 metric tons in the first quarter 2010 over 2009, with coal climbing 165.5 percent to 1,217,799 metric tons, followed by a 322.7 percent jump in coking coke to 512,065 metric tons and 729.3 percent increase in petroleum coke to 252,424 metric tons. Wood pellet volumes also increased 75.6 percent to 51,661 metric tons.
The port is contributing C$280 million a year to the Canadian gross domestic product and C$500 million a year to the economic output of regional and provincial economies, according to an economic impact study commissioned by the port.
The study, conducted by InterVISTAS Consulting, Inc., also found that the port is contributing to the generation of more than 2,700 full-time jobs and adding C$150 million in annual wages into the regional economies located along the port’s transportation corridor.
The study also found that the port is creating substantial revenues for all levels of Canadian government, totaling C$35 million in taxes annually, including C$22 million in federal taxes, C$9 million to the Province of British Columbia and C$4 million in municipal taxes.
Bulk, Containers and Cruise Lines
Farther south, Port Metro Vancouver’s 2009 year-end cargo statistics are not as sunny. Port Metro Vancouver is Canada’s largest port, and the fourth largest port in North America, and includes the ports of Vancouver BC, Frasier River, and North Frasier River.
According to quarterly reports, Vancouver saw growth in grain, specialty crops and petroleum products, and a modest increase in export laden container volume, but a decrease in total container count.
In January, Global Container Terminals and Port Metro Vancouver opened a new $400 million third berth at Deltaport container terminal, which began in January 2007 and was completed in December 2009, on-budget and on-time. The project, which took two years to complete, increased Deltaport’s capacity from 1.2 million TEUs to 1.8 million TEUs, and added almost 50 acres of container storage facilities, as well as the first quad cranes in America.
“Over the next ten years, container traffic through the West coast is expected to double,” says Robin Silvester, President and CEO, Port Metro Vancouver. “The new berth at Deltaport is part of a long-term plan to strengthen Canada’s Pacific Gateway and ensure our ability to accommodate the growth in container trade, in particular with Pacific Rim economies like China.”
Overall, the Port’s volume of 101.9 million metric tons declined 11 percent compared to 2008.
“At the end of a challenging and turbulent year, we’re pleased to see gains in some principal Canadian exports, such as grain, specialty crops and crude petroleum,” says Silvester.
Although total foreign exports were flat on the year, the positive economic growth in China and India, along with stability in South Korea, translated into strong increases in exports of Canadian commodities through the Port.
Overall container volume for Port Metro Vancouver decreased nearly 14 percent, to 2.2 million TEUs for the year, including an almost 19 percent decline in laden container imports, while stable demand for containerized exports of forest products and specialty crops helped laden outbound units advance by one percent. Although the Port’s laden container business finished the year down 10 percent, the sector recorded a marked improvement compared to the 17 percent decline reported at mid-year, and the first quarter of 2010 saw the port handle a total of 724,434 TEUs in April, an 8 percent increase over April 2009. Port officials also reported that total loaded inbound box volume in April climbed 17 percent compared to April 2009, with 359,408 TEUs moved. The port also handled a total of 260,121 loaded outbound TEUs in April, a 3 percent increase over the year-ago period.
The port reported coal exports down six percent for 2009, at 24.3 million metric tons, accounting for nearly one quarter of total port tonnage. Consistent growth in exports to South Korea and China throughout the year was complemented by the recovery of demand for metallurgical coal by major steel producers, such as Japan, in the second half of the year.
The port’s grain, specialty crops and feed volumes increased 33 percent and set a throughput record for grains at 18.1 million metric tons. These record volumes resulted from high carryover from a very good 2008 harvest, a larger than expected 2009 harvest, and very strong demand in Asia, South America and the Middle East. Canola increased 38 percent on high demand from Asia, and volumes to China peaked in advance of its November 15 ban on Canadian canola. Wheat volumes through the Port advanced 38 percent on strong demand from Latin American, South American and Middle Eastern markets.
Demand also remained strong for crude petroleum, which recorded a 77 percent surge over 2008, as oil sand activity continued to direct outbound crude shipments through the Port to northern US refineries. Gasoline, derived from the crude petroleum refining process, also experienced a five percent boost over 2008 volumes.
Bulk and breakbulk cargos through the port saw a decline in 2009, including a decrease by 15 of vehicles shipped through the port, to 387,230 units. Sulphur volumes were down 14 percent as low demand in the first half of the year and declining supply from accessible sources affected volumes, and forest products volumes dropped 21 percent, most likely due to a severe downturn in the Canadian forest industry that affected domestic volumes, although foreign forest product volumes increased by one percent, driven by strong demand from China. Port metro Vancouver reported domestic sand and gravel volume declines of 35 percent due to reduced construction activity in the Metro Vancouver region. Volumes at mid-year decreased 53 percent compared to 2008, reflecting a 50 percent drop in the value of building permits in the Lower Mainland, but recovered slightly in the third quarter due to increased local construction activity.
Domestic shipments of logs were down 42 percent, paper and paperboard down 19 percent, woodchips down 18 percent, and caustic soda down 43 percent.
Domestic moves of consumer and related goods also declined 12 percent, from 4.6 million to 4.1 million metric tons, reflecting the decrease in consumer spending that also contributed to the reduction in import containers.
Cruise Volumes Up
Vancouver’s cruise passenger volumes increased five percent in 2009 to 898,473 revenue passengers over 256 voyages through Port Metro Vancouver, in part from the diversion of the Carnival Splendour to the Vancouver-Alaska cruise from its usual southern itinerary.
The port kicked off the 2010 cruise season with an eco-friendly visit by Holland America’s ms Amsterdam, which was the first cruise ship of the 2010 cruise season to call at Port Metro Vancouver in late April, and the first of 58 scheduled calls expected to connect to the Port’s new shore power system. The ship arrived in Vancouver after sailing from Petropavlovsk, Russia as part of a 114-day Grand World voyage.
This will be the first full year of operation for Port Metro Vancouver’s two new shore power connections at Canada Place- one of only three such systems in the world, according to Silvester.
The cold ironing system, completed in 2009, is a $9-million initiative by the Government of Canada, the British Columbia Ministry of Transportation, Holland America Line, Princess Cruises, BC Hydro and Port Metro Vancouver which is expected to reduce greenhouse gas emissions in Vancouver by up to 3000 metric tons a year.
Despite forecasting declines this year to just under 600,000 passengers and 179 ship calls, the port remains optimistic about its future cruise business. Disney Cruise Line has announced that they will home port Disney Wonder in Vancouver in 2011, and the Cruise Lines International Association (CLIA) cruise3sixty 2010 trade show will be held in Vancouver this month, marking the first time in its history the event has been held outside of Ft. Lauderdale, Florida.
Allied Shipbuilders Coast Guard Contract
Allied Shipbuilders, in North Vancouver, is completing a C$15 million major refit on the Canadian Coast Guard Ship (CCGS) Bartlett.
The work is the second phase of a major life extension project for the CCGS Bartlett, with the first phase having been completed by Allied Shipbuilders Ltd. in July of 2009.
The CCGS Bartlett, based in Victoria, BC, is a medium-endurance multi-tasked vessel, used in tending to navigational aids, resupplying lighthouses, search and rescue, and fisheries enforcement. It is based in Victoria
The work is part of a $175 million package announced for the Coast Guard in the Government of Canada’s Economic Action Plan, $74 million of which will be invested in life extension projects for five of the Canadian Coast Guard’s largest vessels, with all repair work to be completed by March 2011.
New Canadian Fleet
The Canadian Government has embarked on a new Naval shipbuilding program to update an aging fleet. This year marks the Canadian Navy’s 100th anniversary, but the majority of Canadian shipyards have not received any government orders for new construction since the 1980s, and last month the head of the Canadian Navy, Vice-Admiral Dean McFadden, said Canada needs to upgrade its 12 warships, replace its destroyers and supply ships, and build new ships to operate in the Arctic.
Last July, Canadian National Defense Minister Peter MacKay announced a fleet renewal plan to build more than 50 large vessels for the Department of National Defense and the Coast Guard, plus another 70 smaller vessels of less than 1,000 tons. The Federal Government’s National Shipbuilding Procurement Strategy (NSPS) could provide 70 million person hours over the next 30 years and is valued at more than C$40 billion. The programs include the construction of more than 50 ships for the Federal Shipbuilding Programs.
This year, in addition to its regular duties, Canadian forces have been called to counter-piracy operations in the Gulf of Aden and off the coast of Somalia.
“You can’t do this work without the right equipment,” says McFadden. “Let’s get on with it.”
Jonathan Whitworth, CEO of the Washington Marine Group (WMG), agrees, and hopes his organization will see a large share of vessel construction contracts under the NSPS.
In April, WMG announced a teaming agreement with systems, software and hardware engineering group Thales Canada and hopes to provide the Canadian Government with a single solution for the future construction and in-service support of the Arctic Offshore Patrol Ships (AOPS). The AOPS program is worth more than C$2 billion dollars, and will deliver six ice breaking patrol vessels to the Canadian Navy, as part of the NSPS.
The program is expected to provide 700 to 800 skilled jobs to BC shipbuilders. WMG is currently supplying in-service support for the Canadian submarine fleet, Mid Life extension for Canadian Patrol Frigates, and building motorized lifeboats for the Canadian Coast Guard.
Late last year, WMG formed an alliance with other shipbuilders located on the West Coast of Canada, to provide a unified voice to all levels of government in an effort to promote BC’s shipbuilding industry. The Pacific Coast Shipbuilders Association (PCSA) includes the three Washington yards, as well as eight other British Columbia-based shipyards.
Robert Allan Ltd. Celebrates 80 Years
Last month, Canadian naval architecture firm Robert Allan Ltd. (RAL) celebrated its 80th continuous year in business as an independent, privately held, consulting Naval Architecture firm. With 65 employees, RAL is one of the largest in the country and provides ship design and related consulting engineering services to international commercial and government clients. The firm designs high-performance tugboat designs for tanker escort and LNG terminal support services, fireboats coastal and river tug-barge towing systems, offshore support vessels, crewboats, patrol craft, scientific research vessels, icebreakers, ferries and a wide array of unique specialized craft.
Robert Allan Ltd. designs account for an estimated 25 to 30 percent of the world’s new tugs in the past decade, and significant projects include the creation of a fleet of seven major escort/terminal RAstar Class tugs for Svitzer at Milford Haven, UK, five unique Voith-propelled escort tugs for Ostensjo Rederi AS of Norway for Oil terminals in the Norway and the UK, a fleet of twenty 25 metre and 30 metre RAmparts Class ASD tugs for SMIT-Rebras in Brazil, the development of the award-winning Z-Tech concept for the Port of Singapore, and many others.
