The Livable Blog

We have all heard about declining shipping volumes worldwide, and in Vancouver area ports. But this Pete McMartin column from the front page of the Vancouver Sun outlines why we may never get back to the peak container volumes of 2007, even if worldwide shipping takes off again.

Of course, peak oil makes it very unlikely that shipping volumes would return to these peak volumes for very long. There is just not enough cheap oil left to make shipping lower-value products long distances an economic proposition. And that is even without the severe carbon pricing and caps that are on the horizon.

The business case for Gateway is sunk. Period.

Vancouver port may be left waiting for its ships to come in

By Pete McMartin, Vancouver Sun February 16, 2009

VANCOUVER — Geography, some historians say, is destiny. If so, Vancouver as a West Coast port may be destined for some leaner times.

We happen to be blessed with a natural harbour. We happen to be Canada’s largest city on the Pacific. We happen to be among the closest ports to the giant Asian economies. Those geographic happenstances secured Vancouver’s past: they have been held up as the promise of its future. The entire premise of Premier Gordon Campbell’s Gateway expansion plan is based on them.

But there are events happening now and in the very near future that could deflate the promise of Gateway. Geography is central to that.

The first event is far to the south. By 2014, the expansion of the Panama Canal is scheduled for completion. That expansion will not only allow bigger ships to go through the Canal, but, more to the point, also bigger container ships.

The second event is far to the north. For the first time ever last year, the Northwest Passage was free of ice. Some scientists are predicting it could be ice-free by 2030. The Passage will be open to large ocean-going ships, opening up a second and even faster route between Asia and eastern North America.

So?

Container traffic is the raison d’etre of Gateway. The more containers there are, the more infrastructure is needed to move them. The planned expansion of Roberts Bank and the development of lands around it, for example, are based on container traffic.

Here is where geography intrudes. The longer a container is moved by sea, the cheaper the transportation costs. The containers that are off-loaded here, however, and either moved by rail through Vancouver or repacked into other containers at local terminals are headed primarily for bigger markets in the east.

But if you are a shipper, why deal with any of that?

Why not just ship it directly to the biggest markets you hope to exploit?

Those questions may have begun to be answered in other West Coast ports. This news item on the twin ports of Long Beach/Los Angeles comes from the Los Angeles Times business section, on Nov. 28, 2008:

“But the problems at the twin ports, along with smaller West Coast harbors” — [such as Vancouver’s] — “extend beyond the nation’s economic woes, maritime experts say, and changes on the horizon could leave the seaports struggling to keep customers.

[snip]

More Thursday.

pmcmartin@vancouversun.com
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