Labour woes work in Rupert’s favour

Two separate sets of labour difficulties are making the Port of Prince Rupert a desired location to send product these days.

The recent CN strike and a retaliatory lock out of Vancouver based rail workers, is combining with a potential strike at CP Rail to drive more business towards athe northwest and the Port of Prince Rupert.

Add in the fact that the CN dispute has resulted in a perceived congestion problem at the Port of Vancouver (one the Port there is struggling to explain as non existent) and suddenly the Port of Prince Rupert is a destination for shippers looking to move their product as expeditiously as possible.

The Vancouver Sun had an interesting look at how the Northwest corridor is finally starting to get the message across that it’s a reliable, quick and hassle free way to get product to consumers.

Rupert stands to gain from labour strife
Railway work stoppages mean northern port starting to see more work
Fiona Anderson
Vancouver Sun
Wednesday, April 25, 2007

The Port of Prince Rupert may be the ultimate beneficiaries of work stoppages like the recent CN Rail strike-turned-lockout and a threatened strike of maintenance workers at Canadian Pacific Railway Ltd.

Legislation ordered CN Rail conductors and yard workers back on the job on Thursday. But Prince Rupert was "happily" unaffected by the job action which lasted just over a week, said Greg Slocombe, president and chief operating officer of Ridley Terminals Inc. in Prince Rupert.

The United Transportation Union initiated what were to be rotating strikes on April 10 after almost 80 per cent of their members who voted rejected a tentative agreement with the Canadian National Railway Co. CN then retaliated by locking out the employees who had gone on strike.

"Fortunately for us [the UTU] started its rotating strikes where there would be highest impact and that's Vancouver," Slocombe said. "So they locked them out down there. But we've not seen any job action up here at all so therefore there's not been lockouts."

And as CP doesn't have a rail line to Prince Rupert, a threatened strike by the 3,000 maintenance-of-way employees represented by the Teamsters Canada Rail Conference will also have no negative effect.

And in fact, both work stoppages could actually benefit the northern port.

"In a back-handed way, because they've had some challenges in Vancouver, not necessarily just strike-related but congestion related [as well], that's actually playing into our hands," Slocombe said. "It's starting to throw more business our way."

Ridley, which is a bulk coal terminal, expects its shipments to at least double this year, partly due to increased production in northeastern British Columbia, and partly due to congestion in Vancouver-area ports.

Jeff Burghardt, president of Prince Rupert Grain Ltd., which handles wheat, durum, barley and canola, said his company didn't notice any increase in shipments due specifically to the CN dispute. But Burghardt is finding more and more customers want to do business out of Prince Rupert.

"I think there has been a gradual recognition that the northwest corridor [through] Prince Rupert can deliver superior service and people are certainly recognizing the value of more reliable delivery times," Burghardt said. "And that's helping us."

Total grain shipments from the West Coast is expected to be 16 to 17 million tonnes this year, up from a five-year average of 13 million tonnes.
"A lot of that incremental business is finding its way exclusively to Prince Rupert," Burghardt said.

Denis Horgan, vice-president and general manager of Westshore Terminals, which handles coal in the Lower Mainland, said that since January the terminal has lost two or three ships to Ridley in Prince Rupert.

A number of factors contributed, including the CN lockout and bad weather. But CN has been promoting Ridley "as a less-congested option," Horgan said. The congestion is on the railroad, not at the terminal, which last year moved 19 million tonnes of coal but has capacity for 24 million tonnes increasing to 29 million tonnes, Horgan said.

"There's no congestion here. We've lots of capacity. But certainly for whatever reason CN would seem to prefer the Ridley gateway over the Vancouver gateway for coal because of congestion or perceived congestion in the Vancouver rail corridor," he said.

"We're not congested or over capacity," he added. "We'd certainly like to be, but we're not."
Scott Galloway, director of trade development at the Vancouver Port Authority agreed that capacity was not the issue.

The port only looks at numbers annually, so Galloway couldn't say if there have been any shifts away from Vancouver to Prince Rupert so far this year. But last year, the port set a record for tonnage, he said.

"And I would still argue that there is a lot of capacity left on the bulk side and the container side," Galloway said.