Even after the federal government poured millions into revamping a deep-sea port in Manitoba, Saskatchewan farmers and miners say they prefer shipping their grain and potash cargoes to Vancouver.
A recent shipment to the Port of Churchill marked the first grain export through the northern port in six years.
It follows $320 million in federal investment and $87.5 million in provincial support to revive the channel leading into Hudson Bay.
But industry advocate Bruce Burrows, who is the executive director of Grain Growers of Canada, doesn’t believe it will change the shipping status quo.
“We’re happy to see it move, but I just don’t think the growth potential is going to be that great,” he said.
The Arctic Gateway Group has managed the port and the Hudson Bay Railway’s short line from The Pas since 2018.
Chris Avery, president and chief executive of the group, says the route is a “strategic asset” for Canada that can handle grains, potash and critical mineral exports bound for Europe.
It’s not a replacement to Vancouver, but Avery says it’s a smaller player that can offset some of the pressures as Canada wants to double its exports as it diversifies from the U.S. market.
“Building more trade enabling infrastructure across Canada, including in our north, is a national imperative and makes a ton of sense,” said Avery.
Canpotex Ltd., the joint marketing arm for Nutrien Ltd.’s and Mosaic Co.’s potash exports, says the route is “not a suitable option” for its heavy railcars of potassium fertilizer.
“The port lacks the necessary equipment to receive potash railcars or load product onto vessels,” Natashia Stinka, the director of public affairs, said in an email.
Export-oriented companies welcome an additional corridor, but some say they plan to stick with the longer Vancouver route, including German potash mining company K+S AG, which operates Saskatchewan’s Bethune mine.
“Our established West Coast gateways remain the most practical and competitive option for our business today,” Tyler McDougall, senior manager of logistics at K+S, said in an email.
The agriculture industry is also likely to keep sending half of its harvest through the West Coast.
“Fifty per cent of what we grow every year in terms of grain moves through Vancouver, so it’s a key gateway for our export success as a country,” said Borrows.
Vancouver has long dominated as the terminal connecting Saskatchewan’s key products to international markets. Last year, 30 million tonnes of grain and 11 million tonnes of potash were shipped out from that port.
It’s Canada’s largest port, handling a whopping amount of cargo that rivals the next five Canadian ports combined.
But bottlenecking and interruptions have made potash companies with deep pockets consider other options.
“We are concerned about frequent supply chain disruptions inside Canada — not just the Vancouver corridor — including labour disruptions, weather events and infrastructure constraints,” said Stinka of Canpotex.
Saskatoon’s Nutrien is eyeing up a $1 billion investment south of the border for a potash export terminal in Longview, Wash. but hasn’t made a final decision yet.
That additional terminal would provide more options for Canpotex, which also operates out of Saint John, NB, and Portland, Ore.
However, its up-and-coming competitor, Australian mining subsidiary BHP Canada Inc. is putting $1 billion into Westshore Port Terminal at Delta to handle shipments from its still-in-construction Jansen mine in Saskatchewan.
The federal government recently unveiled a strategy to double the exports through Vancouver, with investment into a container freight terminal.
Days later, the Port of Vancouver announced a call for proposals to redevelop a wharf that could handle dry bulk commodities such as grain, coal and potash.
A spokesperson with the port authority said the Fraser Wharf is a mid-size facility that can handle eight million tonnes of dry bulk product. It issued a call for proposals to develop the brownfield property.
Despite disruptions and other arteries available to it, Canpotex says Vancouver remains the “most critical outlet,” handling 70 per cent of its exports since it is both cost-effective and efficient, Stinka says.
“Vancouver is the most critical outlet for Canadian potash exports and will be for the foreseeable future.”