A second, new grain export terminal proposed for the Port of Vancouver, is welcome news, says University of Saskatchewan agricultural economist Richard Gray.
Western Canadian grain production is on the upswing and because of rising demand in Asia, Canadian grain companies want to export through the West Coast because that’s where prices are highest. Additional grain export capacity from Vancouver will help Prairie grain farmers get better returns, Gray said.
Parrish and Heimbecker Limited (P&H) and Paterson GlobalFoods Inc. (PGF) are the latest to announce plans to build an export terminal in British Columbia’s lower mainland. If approved by the Port of Vancouver, Fraser Grain Terminal, to be built at the Fraser Surrey Docks on the Fraser River, will have total of 97,000 tonnes of storage capacity, Casey McCawley, P & H’s director of West Coast operations said in an interview Dec. 5.
Seventy-seven thousand tonnes will be new, plus 20,000 tonnes of existing storage. The two companies already operate a facility on that site. The operation uses ‘direct hits’ matching Prairie grain trains with arriving ships. Its success has given the companies the confidence to build a new terminal, McCawley said.
The companies also own and operate Alliance Grain Terminal, a 102,070 tonne storage capacity grain export terminal, on the south shore of Burrard Inlet.
“While we are building terminal capacity we are adding inland capacity by expanding our inland footprint,” McCawley said. “We see both projects being co-ordinated and being built hand-in-hand. We need to build them both.”
Meanwhile, G3 is proposing a 200,000 tonne storage grain export terminal be built on the north shore of Burrard Inlet.
If both terminals are constructed it will boost Vancouver’s grain storage capacity of almost 978,000 tonnes by 28 per cent to 1.55 million.
“This would be very helpful and would increase the return to Western Canadian grain farms,” Gray said in an email Dec. 2. “It is very good news. I hope both will proceed to completion.”
With Western Canadian crop production increasing, there are times when there’s more grain than the port, and pipeline serving it, can handle, Gray has said in previous interviews. When that happens grain companies ration the grain moving west by widening the basis (difference between Freight on Board grain prices in Vancouver and what farmers receive at their local elevator), resulting in lower prices for farmers.
The proposed terminal, which will include a semi-loop track and holding tracks to reduce shunting during unloading, will be modern and efficient, McCawley said.
“With our choice of location… we are very encouraged by the rail metrics that we have in terms of car turnaround times at that facility,” he said. “The location is not encumbered by rail bottlenecks, like bridges, Tunnels and congested rail yards.”
The facility will be serviced by CN, CP and BN railways and Southern Railway of British Columbia (SRY), a regional railway.
“Our project will support Canadian farmers, increase efficiency in grain exports and build strong business relationships with customers around the world,” states the document explaining the project. “Since 2014, exports of grain and specialty crops have increased by more than 20 per cent, with China and India becoming increasingly important destinations for Canadian products. This project will help address two major constraints in getting Canadian grain to overseas customers today — limited Western Canada rail capacity and a shortage of port industrial land for grain handling.”
Currently Panamax ships can’t fully load in the Fraser River because of the George Massey Tunnel, which goes under the river. However, plans are underway to replace the tunnel with a bridge, which means ships can take on more cargo.
The current draft restriction is 11.5 metres, McCawley said.
“It means we can load — it depends a little bit with the tidal influence on the river — up to 54,000 to 55,000 tonnes in a Panamax,” he said.
“For larger vessels we top up up at our deepwater terminal (AGT) in Burrard inlet.”
Industry observers say the Port of Vancouver could currently ship out around 30 million tonnes of grain a year. Port figures show in 2015 almost 25.1 million tonnes of grain (3.6 million tonnes of it in containers) were exported — up considerably from 10 years ago when the average was around 17 million tonnes.
“With Western Canadian grain production growing by about three per cent a year it won’t be long until we hit that 30 million tonnes and we will need extra capacity,” one grain industry official said.
The public had 20 days ending Dec. 1 to comment on the proposed new terminal, including at two open houses.
The plan for the Fraser Grain Terminal calls for the demolition of two existing buildings and the new construction of the following:
- Unloading station and transfer tower with fully enclosed conveying equipment and a built-in dust suppression system.
- Thirty-four above-ground steel storage bins (24 and 10, 3,000 and 500 tonnes, respectively).
- A travelling ship loader with telescopic cascading spout to reduce dust during vessel loading, replacing existing ship loader fitted with older technology.
- A semi-loop rail track and holding tracks to reduce shunting during unloading.
- A container loading facility and storage yards.
- A rail and truck loading facility.
- An administration building and maintenance shop.
As part of the review process before construction is approved studies will be done in a number areas from air quality and the impact on endangered species to noise and traffic in the area.