Nova Scotia Journal

Wednesday, December 8, 2021

Storms in Canada’s biggest port strand grain in the prairies

Canada's biggest port

Key Takeaways:

  • Storms blocked entrance to the Port of Vancouver during the peak shipping season, leaving mountains of wheat and canola trapped in Canada.
  • After days of heavy rain and landslides, there is no train access to Canada’s largest port.

According to Quorum, a business that monitors Canada’s grain transportation system, about 20 vessels are waiting for supplies, while a couple hundred thousand tonnes of grain are stalled in transit. Because they won’t be able to make deliveries on time, some exporters may be forced to declare force majeure to avoid penalties, according to Wade Sobkowich, executive director of the Western Grain Elevator Association.

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After ‘extraordinary’ storms, Vancouver is cut off by road and rail. A contractual clause known as force majeure allows delivery to be suspended due to events beyond a company’s control, such as natural catastrophes.

Officials from the federal government said they are working with businesses to reestablish key supply lines, and they have met with representatives from railways, truckers, and the Vancouver port. Canada is one of the world’s largest grain exporters, with Vancouver accounting for over half of all shipments. The outage occurs at the busiest time of year for grain shipping and when global supply lines are already experiencing congestion and backlogs.

Quorum President Mark Hemmes described the situation as “disastrous.” “You have got rail lines from Canada that run into the terminal cut off.” The highways have all been blocked off. It is also Canada’s largest port.” He says that there is only enough grain at export terminals to keep shipments going for the next four to seven days.

According to Greg Cherewyk, president of industry group Pulse Canada, the rail line problems may be repaired in the coming weeks, but the stoppage effects will last for months.

A nationwide drought that reduced Canada’s output has pushed agricultural prices higher, with canola nearing all-time highs. The lack also had a role in the province’s severe wildfires this summer, which forced the closure of both main rail lines and created a supply chain bottleneck near the Vancouver port.

Source: Dailymaverick news

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