Total West Coast grain movement so far this crop year is just a bit off the pace from 2009-10.
As of week 18 (Dec. 5) grain terminals in Vancouver and Prince Rupert shipped out almost 6.4 million tonnes of the major grains and oilseeds, down seven per cent compared with the same period a year ago, according to Canadian Grain Commission statistics.
However, wheat movement is 26 per cent lower because of harvest delays, lower-than-average wheat quality and the temporary closing of a Vancouver terminal, according to Canadian Wheat Board (CWB) spokeswoman Maureen Fitzhenry.
“We’ve got a lot of challenges and so do all commodities really with the supply chain right now because of a number of factors coming together,” she said in an interview.
“There was a lot of congestion along Vancouver’s south shore for a while. It’s now cleared up but now we’re having issues of getting cars into there. All these things have been working against the supply chain for the last number of weeks resulting in vessel delays and system-wide delays affecting all commodities.”
Last week there were 10 vessels waiting in Vancouver for grain – three were loading and seven waiting, with longest one having been in port since Nov. 22, Fitzhenry said.
According to currency trader John De Pape, the CWB is running up ship demurrage in Vancouver because it’s not able to get farmers to deliver high-quality durum wheat. Speaking at the recent Fields on Wheels conference in Winnipeg, De Pape said the problem is the CWB system doesn’t send farmers accurate market signals. In an open market grain companies attract grain deliveries by narrowing their basis, which raises prices at the elevator.
“Let’s give farmers more and better market signals so they can respond to the market appropriately,” he said.
Fitzhenry said problems at the West Coast have more to do with this year’s lower-grading crop than price signals. The CWB routinely pre-sells a certain volume of grain, but meeting those sales has been tough because harvest was late and there’s a lot less high-quality, high-protein wheat around, she said.
Logistics were further hampered when Viterra’s Cascadia terminal in Vancouver closed to clean up an insect infestation Nov. 19 to 28.
While wheat shipments in total are down so far this crop year at the West Coast, durum movement of 229,800 tonnes as of Dec. 5, was up 62 per cent from the same time last year.
– JOHN DE PAPE