Seeking to Develop Container Traffic Along the Seaway

While the Saint Lawrence Seaway between Montreal and the Great Lakes carries minimal container traffic, evolving developments in the world economy and in container transportation offers a possibility of increasing container traffic along the Seaway.

Introduction

The Port of Montreal located at the west end of the Lower Saint Lawrence River is the busiest container port between the Gulf of Saint Lawrence and the Great Lakes. It is operational throughout the year and is designed to transfer containers between ships and the combinations of railways and trucks. During the nine-month Seaway navigation season, a mini-size container ship of under 1,000-TEU feasibly carries containers across the North Atlantic between the European Port of Antwerp and the Lake Erie Port of Cleveland and provides a precedent by which to increase maritime container traffic upstream of Montreal.

The Port of Ogdensburg NY is located along the Upper Saint Lawrence River, west of Montreal and within close proximity to several retail sector distribution warehouses located in Canada and half way between Toronto and Montreal which are also Canada’s largest urban areas. Expected expansion of Western Mediterranean transshipment ports offers a possible future opportunity for Seaway-max ships to carry containers between these ports and the Port of Ogdensburg. Retail sector logistics and operations involve peak movement of container merchandise during the same period as the Seaway navigation season, when the maritime sector can carry the containers.

Retail Sector Logistics

The commercial retail sector that involves supermarket chains experiences their annual peak sales season toward the end of each year. During this period, the warehouses receive winter clothing and footwear that involves greater per unit volume than summer time clothing and footwear. This segment of the market is manufactured overseas and imported inside containers while during an earlier period, winter footwear and garments were manufactured domestically. The factories that once produced the merchandise are closed. This merchandise represents some of the possible future container traffic along the Seaway.

During the early part of each year, while the Seaway is closed, the retail sector undergoes a seasonal slow period and the sell-off off winter footwear and clothing, to make space for spring and summer garments that occupy less volume per unit than winter garments. While the distribution warehouses are pressed for space during the pre-Christmas peak-of-sales season, some additional storage space becomes available inside some warehouses during the post-Christmas slow season when they would be able to store some spring and summer merchandise on site and also move minimal container traffic from overseas.

Tug-Barge Traffic

Initiatives have been underway along the Mississippi River to develop container-on-barge traffic from New Orleans to ports along the waterway. There may be scope to duplicate some of that precedent along the Seaway. Tugs and barges based at Ogdensburg NY could shuttle containers to any of several ports and docks located on the Canadian side of the Seaway. The absence of navigation locks west of Ogdensburg allows for the operation of extended-length tug-barge-tows, including through the Murray Canal that bypasses the roughest region of Lake Ontario and can transit a beam of 50 feet (15.3m).

A tug of 100-foot length could push and navigate a pair or lengthwise coupled barges built to 50-foot beam, nine-foot draft and 450-foot length, carrying up to 360TEUs each (720TEUs) to any of the ports of Oshawa, Toronto or Hamilton. Tug barges carrying road trailers have been sailed from Port of Hamilton to a port located on the Gulf of Saint Lawrence. The relatively gentle lake conditions located west of the Murray Canal can allow for navigation of multiple lengthwise coupled barges, including the 35-foot wide by 200-foot length barges used on the Mississippi River.

Tug-Barge Economics

Several years ago, a research team led by Prof. Jerry Fruin of the University of Minnesota compared domestic movements of containers involving truck, railway and inland waterway transportation. At around 80 containers, inland water transportation began to offer lower per container transportation costs than railway transportation and less than 10 containers to outperform truck transportation. For comparatively short distances along an inland waterway, if the containers were in transit aboard trans-oceanic ship for two to three weeks, the logistics sector will accept 24 additional hours aboard a tug-barge over truck or railway transportation in exchange for lower transportation costs.

Cross-border tug-barge operations along the Upper Saint Lawrence River and Seaway, bypasses the requirements of both the American Jones Act as well as Canadian cabotage regulations that both apply only to domestic shipping. The distances that tug-barges would operate along the Saint Lawrence River involve markets that are of little interest to the railway operator that carries containers between intermodal terminals located only in the largest cities, leaving truck transport as the main competitor. Tug-barge operation allows for possible future service to small terminals and docks that are presently without container service. 

Intermodal Terminals

Many municipalities practice Not-In-My-Backyard when it comes to developing intermodal railway – truck transfer terminals. One of the reasons is the volume of truck traffic that travels along roadways in the immediate region. At the present time, many North American intermodal railway-truck terminals are operating at near design capacity and often involve extended delays. Over the past decade, roadway congestion has increased on the island of Montreal, where both intermodal railway – trucks and intermodal maritime – railway/truck terminals are located. Toronto also has a traffic congestion problem and on roads that connect to the Port of Toronto.

At both Montreal and Toronto, trucks that interline with maritime container terminals operate optimally and with least delay in congested traffic when scheduled to operate during the off-peak periods. North America’s truck transport industry is also expected to experience a shortage of drivers within the next few years. Due to less sailing draft, tug-barges could serve smaller ports and private docks where cranes on rubber tires and extended booms could transfer containers between barges and local trucks that will travel comparatively shorter distances to deliver containers to the final destinations.

Montreal Container Transshipment

The Port of Montreal could transfer shipping containers between inland waterway river tug-barges and ocean-going container ships. There are several river ports along both the Lower and Upper sections of the Saint Lawrence River. For domestic shipping, the cabotage regulations could impose higher per container transportation costs than international regulations for cross-border shipping to American ports such as Ogdensburg, Cleveland and Detroit. A tug used for international tug-barge service could literally fly the flag of any nation served by an international inland waterway, including the flag of Paraguay, Hungary or Uganda.
 
While non-powered barges are exempt from displaying a flag, domestic service tugs are required to be flagged. The arrangement can allow tug-barge tows to move containers in domestic service at lower transportation cost-per-container than a powered, crewed vessel. The absence of navigation locks downstream of Montreal allows for extended length tug barges to move containers to any of several Lower Saint Lawrence River ports. Navigation locks upstream of Montreal would restrict the beam and length of tug-barge tows sailing to ports and terminals located along the Upper Saint Lawrence River and Lake Ontario.

Truck Transport Market

The introduction of short-distance tug-barge operations to the Saint Lawrence Seaway would capture the peak seasonal traffic, leaving the truck transportation industry to carry the winter minimum of traffic. A balance between maritime and road could involve the freight forwarding sector arranging to ensure than the truck sector carries the equivalent of the winter loads throughout the year, with tug-barges carrying peak season overload traffic. Due to cabotage regulations and the Jones Act, such a strategy might only be possible on trans-border tug-barge container transport operations, not domestic transportation service.

The main motorway extending west from Montreal toward Toronto, Detroit and Chicago is one on North America’s busiest roadways for commercial traffic. Weekday traffic congestion is problematic along several segments of this road while Canada’s federal and provincial governments purport to be seeking methods by which to reduce traffic congestion and traffic related carbon emissions. Moving more containers along the inland waterway during peak mid-summer travel season could reduce both the number of heavy trucks along some stretches of roadway and carbon emissions. 

Conclusions

There are possible strategies and evolving changes in container transportation and international trade that could contribute to increasing the movement of containers along the Saint Lawrence Seaway. Tug-barge tows would offer competitive per-container transportation rates to both truck and railway transportation, with trans-border tug-barge operation offering the most competitive transportation costs. There are methods that strategically location retail distribution warehouses could implement that could contribute to increasing container movement along the Seaway.