GLIN==> Seaway to the Rescue - Wheat Exports Set Stage for Busy Fall Season

PRESS RELEASE

 

For Immediate Release
Contact: Laura M. Blades

 
202-558-5123

 

Seaway to the Rescue

Wheat Exports Along Great Lakes-St. Lawrence Seaway Set Stage for Busy Fall
Season

 

            Washington, D.C. (September 9, 2010) - Grain shipments through
the St. Lawrence Seaway increased by 51 percent to 830,000 metric tons in
August compared to the same period last year as international demand began
to ramp up in the wake of production shortages in Russia.

            The St. Lawrence Seaway reported that American grain shipments
reached 303,000 metric tons in August, an increase of 62 percent compared to
the same period last year, while Canadian grain shipments increased by 45
percent to 527,000 metric tons. Year-to-date numbers, however, reflect an 18
percent increase to 743,000 metric tons for U.S. grain shipments and a 15
percent decrease to 2.8 million metric tons for Canadian grain shipments
from March 25 to August 31compared to the same period in 2009.

            Commercial vessels carried a total of 18.7 million metric tons
of cargo through the Seaway from March 25 to August 31 - an increase of 22
percent over 2009. The overall numbers were also helped by strong increases
in iron ore, coal and steel shipments.

            "Robust demand for our services during the month of August
suggests that our key markets are continuing to improve, approaching in some
instances the levels that we witnessed in 2008 before the onset of the
recession," said Richard Corfe, President and CEO of the St. Lawrence Seaway
Management Corporation. "On a year-over-year basis, we note that ocean
vessel traffic has risen sharply given a resurgence in the movement of steel
products. The prospect of strong demand for grain exports to overseas
markets leads us to believe that tonnage will continue on the positive side
for the rest of the season."

By mid-August, one quarter of Russia's grain crops had been destroyed.
Drought, followed by devastating fires, led their government to ban exports
of grain through the end of the year in order to conserve supplies for
domestic food production and animal feed. This situation has caused an
unexpected boon for U.S. grain exporters. 

One of the key Great Lakes grain ports, the Port of Duluth-Superior, has
noted this uptick with vessel agent bookings up 25 percent from this time
last year. Executive Director of the Duluth Seaway Port Authority, Adolph
Ojard, confirmed that 14 ships were at the port last week loading product
for international markets. "Grain is a world commodity and the U.S. not only
grows high-quality spring wheat, we have been fortunate this year to have a
bumper crop. That provides an opportunity to move the agricultural bounty of
North America through the Great Lakes-St. Lawrence Seaway navigation system
to benefit those in need around the world."

            The United States is the world's top exporter of wheat. Media
reports indicate U.S. wheat exports could reach their highest level since
1996, with future demand strong. And American farmers are poised to capture
new market shares overseas. David Torgerson, executive director of the
Minnesota Association of Wheat Growers explained, "We are located about as
far away from our export customers as any farmers in the United States. But,
with the Seaway and the Port of Duluth-Superior, we have a direct water link
to markets around the world (in particular Europe and North Africa), which
keeps transportation costs competitive and enables North Dakota and
Minnesota farmers to compete globally. The farmers really rely on the Seaway
to provide that service."

            Late last week Germany reached out to the United States for
grain, an export they've not purchased from U.S. farmers for three years.
The bulk load represents 20,000 metric tons of spring wheat. According to
Ron Johnson, trade development director at the Duluth Seaway Port Authority,
"Grain buyers in Turkey and Egypt, likewise, are sourcing spring wheat from
Duluth-Superior. Not only are we seeing new customers this year, we're
seeing increased purchases from existing customers. We also expect to export
feed barley to countries we haven't shipped to for 15-20 years."

This increase in business serves to emphasize the strategic value of the
Great Lakes-St. Lawrence Seaway navigation system. Without the benefit of
this water highway, the United States could not be as nimble in moving
product to international markets. Canadian Lakers, which have been the
backbone for bi-national movement between the U.S. and Canada, play an
integral role in that process. 

Allister Paterson, President and CEO, Seaway Marine Transport (SMT) based in
St. Catharines, Ontario stated, "The Seaway provides a critical safety valve
in being able to rapidly respond to sudden shifts in trade patterns. From a
Canadian carrier's prospective, there is no doubt that U.S. wheat bookings
are on the upswing. Before the Russians announced their ban on grain
exports, SMT had planned to lay up ships in August and September. With that
announcement, we were able to book enough U.S. wheat cargoes to keep all of
our ships sailing. In addition, we are spending significant dollars to
mobilize one full seaway-size bulker from inactive status to provide
additional capacity for another 150,000 metric tons of U.S. grain this
season. In total, we have found capacity to move an additional
300,000-400,000 metric tons of U.S. export grain on short notice."

Montreal-based Fednav Limited, the largest international marine bulk
shipping company in Canada, has also noted an increase in its bookings due
to the international demand for grain. According to Jean Lemay, Senior Vice
President, Chartering, "We have noticed a substantial increase in inquiries
for cargoes originating from the Great Lakes to Europe and North Africa,
partly due to a bumper crop in the prairies and to crop failures in other
parts of the world."  

The Seaway navigation system is undeniably efficient; it functions without
affecting other modes of transportation, which are already overloaded. In
terms of capacity, a single Seaway-sized vessel carries 26,500 metric tons
of cargo. It would take 1044 trucks or 270 rail cars to carry the same load.
Additionally, in terms of fuel efficiency and environmental impact, a ship
can travel 312 kilometers with one ton of cargo on one liter of fuel; a
railroad car travels only 181 kilometers; and an 18-wheel semi-trailer truck
goes only 75 kilometers. These efficiencies, in addition to the safety
factor, make transport by water extremely attractive.

 

For interviews, please contact: Nancy Alcalde, Director, Congressional &
Public Relations, Saint Lawrence Seaway Development Corporation on
202-366-0091.

###

Marine Delivers is a bi-national, industry collaboration that aims to
demonstrate the economic contribution and environmental sustainability of
the shipping industry throughout the Great Lakes region. The Marine Delivers
initiative is administered by the American Great Lakes Ports Association in
the United States, and the Chamber of Marine Commerce in Canada. For more
information, visit the Marine Delivers Web site at
<http://www.marinedelivers.com> www.marinedelivers.com.

 

 

Laura M. Blades

Director of Public Affairs

American Great Lakes Ports Association

700 12th Street, NW  Suite 700

Washington, DC 20005

T:  202-558-5123

C:  301-956-5391

blades at greatlakesports.org

 

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