The Daily news from Monday had information of a merger in the agricultural world that could prove to be a bonus for Prince Rupert Grain, as the four parent companies of PRG become three.
RIDLEY IS LIKELY TO SEE MORE GRAIN FLOW
By Leanne Ritchie
The Daily News
Monday, June 4, 2007
Pages one and three
The four parent companies of Prince Rupert Grain will soon become three with the Saskatchewan Wheat Pool’s acquisition of Agricore United.
Jeff Burghardt, president of Prince Rupert Grain, told a group from the province’s trade commission that he believes the consolidation will be good news for the Canadian Wheat Industry and in turn, Prince Rupert Grain.
“When this is all finalized and you take Agricore United out, these three companies – James Richardson Int., the Saskatchewan Wheat Pool and Cargill Ltd. will emerge with about 80 per cent of the significant grain volumes in Western Canada and they will then be the three owners of Prince Rupert Grain,” said Burghardt.
While some assets may be shed in the Lower Mainland, Burghardt said Prince Rupert Grain is the only grain handling terminal on the end of the Northwest corridor.
“We expect going forward there will be some further rationalization of capacity in the Port of Vancouver. As we deal with what are the appropriated products flows for both the southern corridor and the Northwest corridor, the fact there is more capacity here… we ought to take advantage of that capacity first and free up that scare waterfront space in the port of Vancouver for alternate activities,” said Burghardt.
He noted Prince Rupert Grain’s employees have worked hard to ensure they have faster turn-around times for vessel loading. And thanks to a decision last year by CN Rail, rail freight rates are competitive for moving grain through the Northwest.
Prince Rupert Grain began as a joint venture of the four companies back in 1985 when more grain began moving to the Asian market. However, the terminal has never achieved the high tonnage rates that were expected at the time it began operations.
In 2006, the terminal handled four million tones, but it has the capacity to handle seven million tonnes.
The battle to purchase Agricore United has been ongoing since last November.
At that time, Saskatchewan Wheat Pool came forward with a hostile offer. Agricore dismissed the initial proposal as undervalued and Winnipeg-based James Richardson International came forward with a counter-offer.
However, earlier this month, the Pool raised its offer to $20.50 a share.
That was enough to win support from Agricore management, which had previously backed the Richardson offer of $19.25 a share.
The deal is expected to be completed June 15, making Agricore a wholly owned subsidy of the Pool, the companies said.
Showing posts with label Prince Rupert Grain. Show all posts
Showing posts with label Prince Rupert Grain. Show all posts
Wednesday, June 06, 2007
Wednesday, April 25, 2007
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.
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.
Wednesday, February 21, 2007
CN labour dispute causing harbor congestion in Prince Rupert
With a number of grain ships backing up on their loading schedule and problems of poor deliveries prior to the strike, the Prince Rupert Grain Elevator is looking at a recovery period of at least three to four weeks to get back on track, should the train problems get sorted out soon.
All of which does cause problems with reputations in world markets, so it would seem that the current case of congestion, is causing a bit of indigestion for the Wheat Board, the grain elevators and Canada’s reputation as a dependable provider of grains.
The Daily News provided some local interest to the current labour dispute at CN, with a front page story about the local reaction to the troubles being caused by the strike.
SHIPS PILE UP IN HARBOUR AS CN STRIKE CONTINUES
By Leanne Ritchie
The Daily News
Wednesday, February 21, 2007
Ships are turning the Prince Rupert harbour into a parking lot as the labour disagreement between CN and the United Transportation Union continues to exacerbate shipping delays.
The impact of the strike is being felt across the country, to the point where the federal Labour Minister yesterday proposed stepping in with a law ordering the 2,800 CN Rail employees back to their jobs.
“I contacted both parties to inform them that the situation couldn’t continue, that Canada’s economy is being severely affected ... that they only had a few hours left before parliament would act,” Labour Minister Jean-Pierre Blackburn told the House of Commons.
“Our legislation is ready.”
A government source said yesterday that the legislation could be up for a vote on Thursday.
Blackburn’s announcement, made on the brink of what company officials had hoped would be pivotal contract negotiations, came 11 days into the labour dispute.
Striking CN Rail workers rejected a company request to return to work voluntarily Tuesday and the B.C. Federation of Labour was set to rally in Vancouver today in support of the union’s cause.
In Prince Rupert, there are now seven grain tankers and one coal ship waiting to be loaded, with another five expected by the end of the week.
Jeff Burghardt, president of Prince Rupert Grain, said they are currently facing a three- to four-week backlog, caused by poor rail performance for the last 10 to 12 weeks and then exacerbated by the labour disruption
“For us, this is a very acute situation because we were hopeful we would be recovering over these last two weeks and cleaning up the clog of ships, but the strike is not a good opportunity for us to make that headway,” said Burghardt.
“I think that the railway is making a very good effort through the strike to continue to operate the railway, it’s just unfortunate when it comes at a time when we are already behind because of poor performance.”
It will take Prince Rupert Grain two to three weeks of improved rail service — with 1,400 rail cars per week coming through compared to the current 1,000 — to recover. Last week, the Canadian Wheat Board complained that member suppliers are paying about C$150,000 a day in demurrage (penalty) fees for the delays.
Burghardt said these fees, which will come home to overseas customers, will impact the country’s reputation.
“When these types of bills are having to be paid, overseas customers don’t necessarily take the time to understand who is responsible for their added costs. All they know is the Canadian system is letting them down right now and their patience for that sort of thing is running thin,” he said.
Burghardt said in the long run, it will be important for the union and company to work this out.
“It is important for all of us that the people who are working the system come to their own agreements and create more stability in their workforce through those types of methods rather than direct government intervention,” he said.
With files from CP
All of which does cause problems with reputations in world markets, so it would seem that the current case of congestion, is causing a bit of indigestion for the Wheat Board, the grain elevators and Canada’s reputation as a dependable provider of grains.
The Daily News provided some local interest to the current labour dispute at CN, with a front page story about the local reaction to the troubles being caused by the strike.
SHIPS PILE UP IN HARBOUR AS CN STRIKE CONTINUES
By Leanne Ritchie
The Daily News
Wednesday, February 21, 2007
Ships are turning the Prince Rupert harbour into a parking lot as the labour disagreement between CN and the United Transportation Union continues to exacerbate shipping delays.
The impact of the strike is being felt across the country, to the point where the federal Labour Minister yesterday proposed stepping in with a law ordering the 2,800 CN Rail employees back to their jobs.
“I contacted both parties to inform them that the situation couldn’t continue, that Canada’s economy is being severely affected ... that they only had a few hours left before parliament would act,” Labour Minister Jean-Pierre Blackburn told the House of Commons.
“Our legislation is ready.”
A government source said yesterday that the legislation could be up for a vote on Thursday.
Blackburn’s announcement, made on the brink of what company officials had hoped would be pivotal contract negotiations, came 11 days into the labour dispute.
Striking CN Rail workers rejected a company request to return to work voluntarily Tuesday and the B.C. Federation of Labour was set to rally in Vancouver today in support of the union’s cause.
In Prince Rupert, there are now seven grain tankers and one coal ship waiting to be loaded, with another five expected by the end of the week.
Jeff Burghardt, president of Prince Rupert Grain, said they are currently facing a three- to four-week backlog, caused by poor rail performance for the last 10 to 12 weeks and then exacerbated by the labour disruption
“For us, this is a very acute situation because we were hopeful we would be recovering over these last two weeks and cleaning up the clog of ships, but the strike is not a good opportunity for us to make that headway,” said Burghardt.
“I think that the railway is making a very good effort through the strike to continue to operate the railway, it’s just unfortunate when it comes at a time when we are already behind because of poor performance.”
It will take Prince Rupert Grain two to three weeks of improved rail service — with 1,400 rail cars per week coming through compared to the current 1,000 — to recover. Last week, the Canadian Wheat Board complained that member suppliers are paying about C$150,000 a day in demurrage (penalty) fees for the delays.
Burghardt said these fees, which will come home to overseas customers, will impact the country’s reputation.
“When these types of bills are having to be paid, overseas customers don’t necessarily take the time to understand who is responsible for their added costs. All they know is the Canadian system is letting them down right now and their patience for that sort of thing is running thin,” he said.
Burghardt said in the long run, it will be important for the union and company to work this out.
“It is important for all of us that the people who are working the system come to their own agreements and create more stability in their workforce through those types of methods rather than direct government intervention,” he said.
With files from CP
Wednesday, February 14, 2007
Shipping backlog causing Demurrage costs at Prince Rupert and Vancouver to add up
With wheat shipments already backed up even before the current labour dispute at CN was under way, the Canadian Wheat Board is looking at costs of between 130,000 and 180,000 US$ for demurrage at Prince Rupert and 150,000 US$ for those vessels calling on the Port of Vancouver.
The backlogs have been an ongoing concern for the last few weeks as cold weather on the prairies conspired against transportation requirements. Now with the additional stress of a railroad dispute, the worries over further backlogs are high on the minds of officials.
The backlogs have been an ongoing concern for the last few weeks as cold weather on the prairies conspired against transportation requirements. Now with the additional stress of a railroad dispute, the worries over further backlogs are high on the minds of officials.
And that backlog situation could very well get worse as more than fifteen vessels are expected to call on the West Coast ports over the next two weeks.
A Saskatoon radio station posted the following story on the net on Wednesday, giving an indication as to the concern that the backlogs are causing for the Canadian Wheat Board.
Demurrage Costs Adding Up on the West Coast
Written by Neil Billinger - 600 Action News-Local First
Wednesday, 14 February 2007
The latest figures from the Canadian Wheat Board indicate 11 ships are waiting for grain in Vancouver, with another 6 at Prince Rupert.
CWB Spokesperson Maureen Fitzhenry says ''we are looking at paying demurrage every day at Prince Rupert in the neighborhood of $130,000 to $180,000 U.S. That is on top of a daily charge in the neighborhood of $150,000 U.S. at the Port of Vancouver."
Grain transportation problems have been a problem for the last few weeks, but the situation is more serious with a strike by CN conductors and yard workers. Fitzhenry says ''the CN strike did not cause this situation, but it is certainly impeding our efforts to get it resolved." One ship at Vancouver has been waiting for 27 days.
Over the next two weeks, the CWB is expecting another 15 vessels on the west coast to pick up half-a-million tonnes of grain.
There is no progress on the labour front. CN is trying to have the strike, which started on Saturday, declared illegal. However, the Canada Industrial Labor Relations Board has delayed the hearing until Monday.
Demurrage Costs Adding Up on the West Coast
Written by Neil Billinger - 600 Action News-Local First
Wednesday, 14 February 2007
The latest figures from the Canadian Wheat Board indicate 11 ships are waiting for grain in Vancouver, with another 6 at Prince Rupert.
CWB Spokesperson Maureen Fitzhenry says ''we are looking at paying demurrage every day at Prince Rupert in the neighborhood of $130,000 to $180,000 U.S. That is on top of a daily charge in the neighborhood of $150,000 U.S. at the Port of Vancouver."
Grain transportation problems have been a problem for the last few weeks, but the situation is more serious with a strike by CN conductors and yard workers. Fitzhenry says ''the CN strike did not cause this situation, but it is certainly impeding our efforts to get it resolved." One ship at Vancouver has been waiting for 27 days.
Over the next two weeks, the CWB is expecting another 15 vessels on the west coast to pick up half-a-million tonnes of grain.
There is no progress on the labour front. CN is trying to have the strike, which started on Saturday, declared illegal. However, the Canada Industrial Labor Relations Board has delayed the hearing until Monday.
Friday, October 20, 2006
Freight rate cut stands to provide long term benefit for Prince Rupert Grain
CN Rail looking to increase the throughput on its Northwestern line offered a three percent price advantage back in August to shippers who send their grain products across the northern lines into Prince Rupert, as opposed to the more congested lines leading to Vancouver.
It’s a decision that could send quite a bit of traffic to the Prince Rupert facility in the future, as it helps to make the transportation costs involving the Rupert Grain elevator more competitive for those looking for shipping options for their product.
The Daily News covered the story and counted on Jeff Burghardt to look at the history of freight rates in Northern BC. He also revealed some of the details of the program and how it could impact on the Prince Rupert’s elevators delivery reputation and its economic success.
GRAIN SHIPPERS FLOCKING TO RIDLEY FACILITY
By Leanne Ritchie
The Daily News
Wednesday, October 18, 2006
Pages One and Seven
A new freight rate introduced this summer by CN Rail will strengthen future prospects for Prince Rupert Grain.
“In the grain business, transportation cost so dominates the competitiveness of your product, it’s a huge turn around for us to say we are a low cost transportation provider,” said Jeff Burghardt, president of Prince Rupert Grain.
On Aug. 1, CN Rail announced it would give shippers moving product to Prince Rupert a three per cent price advantage compared to the rate for shipping grain products to Vancouver in order to encourage full use of the northwestern rail transportation corridor.
Burghardt explained the terminal has been at a disadvantage since 1996 when the Western Grain Transportation Act, which provided for parity freight rates for Vancouver and Prince Rupert, was removed.
“When that was lost, our freight rate at that time became about 15 per cent more expensive than the Vancouver option. We have been battling for the last 10 years to get that back to what we believe is a proper competitive position,” said Burghardt.
“This year, beginning Aug. 1, we absolutely have a lower freight by about three per cent than any other West Coast destination and it is definitely helping to drive our business. We are now seeing more people because of the flat out cost advantage.”
In addition, he said customers are becoming more and more frustrated with congestion in the Lower Mainland.
“Customers, when they had a cost that was lower, would always think ‘this time when I move my product I am going to beat the congestion and my product will get through okay,” said Burghardt.
“They now realize, more times than not, Vancouver is not near what Prince Rupert Grain can deliver to its customers. We have had a real turn around on that front.”
Prince Rupert Grain, located on Ridley Island, is owned by Canada’s five largest grain companies. The terminal can handle up to seven million tones a year, and has the highest throughput of any grain-clearing elevator in Canada.
The terminal shipped 4.1 million tonnes of grain products in the fiscal year ending July 31, 2006 – its best year since 1998. The company credited the good year with prior rate adjustments that brought rail shipping rates to Prince Rupert back down to match those to the Port of Vancouver.
In the past year, the company has also expanded its product mix to include canola and more durum wheat and its workforce has grown by nine employees, all local hires, a high point of the past year for Burghardt.
“We have had the ability to hire people – these are skilled jobs, well paying jobs. We really feel we are on a sustained growth path that is going to allow our business to flourish for a long time in this northwest corridor,” he said.
In addition, the high growth rates in the economies of India and Asia also bode well for the terminal’s future, said Burghardt.
“In the emerging economies of China and India – which we supply a lot of grain products to – as those markets mature and as their economies develop, they move away from agriculture based production to industrial production,” he said. “So they actually have higher food needs as their economies achieve a higher level of affluence.
“In the agricultural business in Canada, we want to serve the value-added opportunities here in North America, but we also want to participate in what we believe are expanded export opportunities. That dynamic should allow for the northwest corridor and Prince Rupert Grain to continue to have a healthy market share anywhere the West Coast exports.”
It’s a decision that could send quite a bit of traffic to the Prince Rupert facility in the future, as it helps to make the transportation costs involving the Rupert Grain elevator more competitive for those looking for shipping options for their product.
The Daily News covered the story and counted on Jeff Burghardt to look at the history of freight rates in Northern BC. He also revealed some of the details of the program and how it could impact on the Prince Rupert’s elevators delivery reputation and its economic success.
GRAIN SHIPPERS FLOCKING TO RIDLEY FACILITY
By Leanne Ritchie
The Daily News
Wednesday, October 18, 2006
Pages One and Seven
A new freight rate introduced this summer by CN Rail will strengthen future prospects for Prince Rupert Grain.
“In the grain business, transportation cost so dominates the competitiveness of your product, it’s a huge turn around for us to say we are a low cost transportation provider,” said Jeff Burghardt, president of Prince Rupert Grain.
On Aug. 1, CN Rail announced it would give shippers moving product to Prince Rupert a three per cent price advantage compared to the rate for shipping grain products to Vancouver in order to encourage full use of the northwestern rail transportation corridor.
Burghardt explained the terminal has been at a disadvantage since 1996 when the Western Grain Transportation Act, which provided for parity freight rates for Vancouver and Prince Rupert, was removed.
“When that was lost, our freight rate at that time became about 15 per cent more expensive than the Vancouver option. We have been battling for the last 10 years to get that back to what we believe is a proper competitive position,” said Burghardt.
“This year, beginning Aug. 1, we absolutely have a lower freight by about three per cent than any other West Coast destination and it is definitely helping to drive our business. We are now seeing more people because of the flat out cost advantage.”
In addition, he said customers are becoming more and more frustrated with congestion in the Lower Mainland.
“Customers, when they had a cost that was lower, would always think ‘this time when I move my product I am going to beat the congestion and my product will get through okay,” said Burghardt.
“They now realize, more times than not, Vancouver is not near what Prince Rupert Grain can deliver to its customers. We have had a real turn around on that front.”
Prince Rupert Grain, located on Ridley Island, is owned by Canada’s five largest grain companies. The terminal can handle up to seven million tones a year, and has the highest throughput of any grain-clearing elevator in Canada.
The terminal shipped 4.1 million tonnes of grain products in the fiscal year ending July 31, 2006 – its best year since 1998. The company credited the good year with prior rate adjustments that brought rail shipping rates to Prince Rupert back down to match those to the Port of Vancouver.
In the past year, the company has also expanded its product mix to include canola and more durum wheat and its workforce has grown by nine employees, all local hires, a high point of the past year for Burghardt.
“We have had the ability to hire people – these are skilled jobs, well paying jobs. We really feel we are on a sustained growth path that is going to allow our business to flourish for a long time in this northwest corridor,” he said.
In addition, the high growth rates in the economies of India and Asia also bode well for the terminal’s future, said Burghardt.
“In the emerging economies of China and India – which we supply a lot of grain products to – as those markets mature and as their economies develop, they move away from agriculture based production to industrial production,” he said. “So they actually have higher food needs as their economies achieve a higher level of affluence.
“In the agricultural business in Canada, we want to serve the value-added opportunities here in North America, but we also want to participate in what we believe are expanded export opportunities. That dynamic should allow for the northwest corridor and Prince Rupert Grain to continue to have a healthy market share anywhere the West Coast exports.”
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