Emerging Competition between Planned Eastern Canadian Super Ports

While Melford Terminals finalizes plans to develop a deep-sea container port in the Strait of Canso in Eastern Canada, a second group has stepped forward to develop a deep-water container port at nearby Sydney. Both locations are easily accessible from the North Atlantic and well protected from severe waves and powerful ocean currents. Each location offers its own unique advantages that include ease of vessel-to-vessel and rail-maritime intermodal transfer of cargo, ability to accommodate the largest ships afloat along with being conveniently located en route between east coast American ports and Western European ports.

The development of the 2-Canadian East Coast super ports will allow the largest ships afloat to feasibly carry cargo destined for northeastern American ports, by sailing via the Suez Canal. Except that most northeastern American ports are too small for the modern super ships. The option of being able to transfer cargo at one or both of the planned eastern Canadian super ports will allow shippers to move massive volumes of freight between points of origin and destination at very competitive transportation costs. Over the long-term, a canal built across Nicaragua may be able to transit the largest ships afloat.

As a result, the Canadian ports may also serve as ports-of-call for ships sailing to and from European ports, via either the Panama or future Nicaragua Canal. Each port also has its own unique selling features and its own unique drawbacks. In terms of interlining with railway transportation, Melford Terminal’s location at the Strait of Canso offers reduced railway distance to major inland points of origin and destination, with possible savings in railway transportation costs. While a railway line does extend to the Port of Sydney, the additional railway distance and related costs places it at a competitive disadvantage.

A deep-water super port built at Sydney would ideally serve vessel-to-vessel transfer of cargo, rather than intermodal rail-maritime transfers. There may be enough future volume of vessel-to-vessel transfers of freight at Sydney to assure the long-term viability of the future super port. The Melford Terminal at the Strait of Canso would be equally competitive, with both super ports depending heavily on future movement of freight between older east coast American ports and ports located across Western Europe and around much of Asia. The terminals would compete for vessel-to-vessel of freight destined for and originating from St Lawrence River ports.

The presence of a tidal navigation lock in the Strait of Canso restricts the size of vessel that it could transit, requiring future lengthening of the lock to transit extended length coupled vessels that may sail between Canso super port and ports along the St Lawrence River and Seaway. Sydney harbor may easily accommodate and assemble extended-length wide-beam barge tows that tugs may push and navigate across the relatively calmer waters of the Gulf of St Lawrence (compared to the North Atlantic) and along the St Lawrence River, over the 1,000-miles (1,600-kms) between Sydney and Montreal.

While the Strait of Canso tidal lock may serve as a competitive handicap, the absence of navigation locks between Sydney and Montreal enhances future prospects for interlining between inland vessels and oceanic super ships. The may be scope to lengthen navigation locks between Montreal and Toronto, to transit tug-pushed trains of pairs of coupled ‘Seawaymax’ barges that sail between the Gulf of St Lawrence and several inland ports around and downstream of Lake Ontario. These ports include Toronto, Hamilton, Oshawa, Oswego and Ogdensburg along with several shallow-draft barge ports that may develop along the Seaway.

Should the length of navigation locks along the Seaway between Montreal and Lake Ontario and at the Strait of Canso remain unchanged, Sydney could gain an advantage in terms of container-on-barge (COB) operations. Barge tows that sail from Sydney and uncouple barges at ports such as Quebec City, Three Rivers and Sorel before arriving at Montreal, where barges may unload at the smaller ports. The cost of moving containers on barges between Sydney and Montreal would be competitive with railway transport. It would be feasible to move tows of 6 x Mississippi size barges a short distance upstream of Montreal.

Moving barges through 4-locks upstream of Montreal (ports of Cornwall and Valleyfield) and the Ottawa River would be cost-competitive with truck transport. To be cost-competitive with rail, barge tows would need to move 1,000-TEU’s between Sydney (or Melford super port) and Lake Ontario. A tug-pushed and navigated 2-unit tow of coupled ‘Seawaymax’ barges could carry up to 2,500-TEU’s on to Lake Ontario at do so at competitive cost provided that the navigation locks were extended to 1,800-ft while using the existing draft and beam. Upon arrival at Lake Ontario elevation, barges may be divided between multiple shallow-draft ports.

Tows of 2 x ‘Seawaymax’ barges may carry containers between future Eastern Canadian super ports and several older east coast American ports, especially if ‘Suezmax’ container ships begin to carry containers to the Canadian ports. During the Seaway navigation season, that technology could carry domestic traffic between Atlantic coast ports and several lower Great Lakes ports, and possible future service to Upper Great Lakes ports. When sections of the Mississippi are closed to navigation due to flooding and/or also due to restricted water levels, some shipments of cargo may be diverted through the Canadian inland waterway system.

Conclusions:

The development of competing super ports in Eastern Canada could offer cost-competitive maritime transportation between eastern USA/Canada and several European/Asian ports, involving larger ships. It could prompt development of barge trains that may sail between the super ports and east coast American ports, also several inland ports. There may also be scope for tug-pushed barge tows to carry cargo at competitive cost between the super ports and several inland ports.

Harry Valentine is a frequent contributor to the MarEx newsletter. He can be reached at [email protected].