TYLER ORTON
Business in Vancouver
Amid blockades on Canadian rail lines and Port of Vancouver property, Andrew Wynn-Williams can squeeze at least one economic positive emerging from the tense protests.
“Because we’re so close to the port, a lot of our manufacturers, particularly in the Lower Mainland, don’t use rail. They use trucks,” said the Canadian Manufacturers and Exporters’ vice-president for B.C.
“However, the flip side is because we’re so close to the port, the economic impact of the port disruption is huge.”
Wynn-Williams estimates declines in B.C. manufacturing shipments abroad come at a cost of about $30 million a day.
That number is pulled from CME’s national estimates of $425 million in daily losses, with B.C. accounting for 8% based on the province’s $52 billion in manufacturing shipments abroad in 2019.
“Any time there’s that kind of uncertainty, it’s not going to be good. People will hang on to their investment dollars,” Wynn-Williams said. “The longer it goes on, the harder it’s going to be to recover.”
His organization wants government to consider investment programs to help industry following disruptions that kicked off in opposition to the Coast GasLink pipeline in northern B.C.
The protests are just the latest punches industry has been absorbing since last fall, said Robert Lewis-Manning, president of the Vancouver-based Chamber of Shipping.
More than 3,000 Canadian National Railway workers staged a weeklong strike in November, while worse-than-expected winter weather in B.C. made loading agricultural products difficult.
“It is a huge confluence,” Lewis-Manning said. At the end of February, he estimated about 60 to 70 ships were in anchor off the B.C. coast from north to south.
“All those ships are just jamming the system up, and it’s going to be slow to load them,” Lewis-Manning said, adding the amount of time to address the backlog has recently moved from a matter of weeks to a matter of months.
“It’s the reliability that really matters, especially for containerized cargo.”
But because container traffic can shift easily to other ports in North America, he said, there’s always a risk that ships and cargo could be diverted to ports in the U.S. in the long term.
“The congestion that’s created from this obviously stretches the supply chain, but, more importantly, what it creates is unreliability on the international stage from a reputational perspective,” said Mike Leonard, president and CEO of the B.C. Maritime Employers Association.
For the week of Feb. 2-8, the association found worker shifts dropped 23% compared with a year earlier at the Port of Vancouver’s south shore (Burrard Inlet) and 12 % at Deltaport as blockades targeted those locations. For the week of Feb. 9-15, worker shifts dropped 20% year-over-year at the Prince Rupert port as protesters blocked the single rail line serving it.
“This is having a real human impact,” Leonard said.
“We have 7,000 highly skilled men and women who want to go to work every day, want to perform their jobs safely and want to provide for their families, and they’re basically caught up in this.”
The jam-ups have been mitigated somewhat by the outbreak of COVID-19 in China.
Lewis-Manning said the outbreak is slowing China’s manufacturing sector, which has resulted in a drop in shipments to Vancouver. While that might ease congestion at the ports, he said the slowdown is harming the B.C. economy.
Ken Peacock, chief economist at the Business Council of B.C., said it would be months before the full toll of the blockades on top of the COVID-19 outbreak can be properly measured.
“More disruptions, more inability to get products to markets, more inability for producers to ship their products out overseas — that’s just disruptive, and it does become costly,” he said.
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