MarketsFarm — On top of disruptions to major supply chains and shipping routes already due to the COVID-19 pandemic, recent events are causing even more headaches for pulse exporters and growers.
The six-day blockage of the Suez Canal by the grounded container ship Ever Given caused a major backup of container ships, tankers and other shipping vessels that’s expected to take days to sort out. With many Canadian pulse exports going to Asia and Africa, this type of disruption would cause a domino effect back home.
“It would definitely impact the transit time of the goods arriving to the country of destination,” Elyce Simpson Fraser, senior vice-president of Simpson Seeds Ltd. at Moose Jaw, Sask., said.
Before the Suez Canal blockage, she added, Canadian pulse exports were already facing difficulties due to “Egypt’s blind lack of willingness” to carry agriculture goods during the pandemic.
Difficulties elsewhere include delays, backlogs, cancelled vessels and a lack of empty shipping containers. The burden of additional costs to ship cargoes such as pulses will then be placed on growers.
“We can’t consistently supply cargo to the markets and it’s causing a lot of stress and cash flow situations along the entire supply chain,” Simpson Fraser said.
“It’s really becoming cost-prohibitive and the market is having to deal with these increased costs on top of these delays and we don’t see this ending for another 12 months.”
To make matters worse, an ongoing labour dispute at the Port of Montreal is already impacting shipments. Longshore workers on March 22 voted to reject their employers’ offer but have not yet submitted a strike notice.
That uncertainty has caused volume at the port to drop by nearly two per cent since the start of 2021 and shipments are being diverted away from the port.
Bulk grain vessels would continue to be loaded and served at Montreal in the event of a strike as per the federal Labour Code, but movement of containerized ag products such as pulse crops would be affected.
“The railways in Regina are returning containers… So we’re stuck with product on plant and left with very expensive options to move our cargo a different way, all of which are not necessarily accepted by buyers,” Simpson Fraser said.
“I encourage anyone who is in touch with their local representative in their constituency to put pressure on the (federal) government to step in, because we cannot afford to have a strike or shutdown at that port.”
— Adam Peleshaty reports for MarketsFarm from Stonewall, Man.