GCT and CN: Vancouver dwell time spike no reason for peak season worry

GCT and CN: Vancouver dwell time spike no reason for peak season worry

The Port of Vancouver was No. 5 on the JOC's Top 25 North American Container Ports ranking of 2017. Photo credit: Shutterstock.com.

Global Container Terminal (GCT) Deltaport and Canadian National Railway say the spike in container dwell times to more than seven days at the largest marine terminal at the Port of Vancouver over the last two weeks is just a fluctuation and not a reason for shippers and forwarders to be worried about a repeat of last year’s peak season disruptions.

Container dwell times at the three major Vancouver terminals jumped into the three- to seven-day range, which raised red flags among cargo interests because dwell times are normally less than three days. When dwell times reach six days, as they did during last winter’s meltdown in Vancouver and Prince Rupert, rail, truck, and vessel operations are all impacted.

Pointing to its $3.4 billion in accelerated investments in infrastructure, locomotive power, and crew, CN said it will be prepared for peak season volumes this autumn. GCT Canada, likewise, sees the current increase in dwell times as a temporary problem that the terminal and railroads are addressing.

“Dwell fluctuation at GCT Deltaport is not systemic, with performance continuing to improve daily,” said Eric Waltz, president of GCT Canada. With strong support from CN and CP, the terminal’s investments in intermodal capacity “will smooth demand surges using a new mode of operation,” Waltz said.  

Last winter’s deterioration in rail service exposed capacity, crew, and infrastructure shortcomings, certainly on the CN network. CN embarked upon its largest-ever capital program. “For us, the story is $3.4 billion in capital expenditures,” CN spokesperson Patrick Waldron said. In addition to infrastructure upgrades throughout its network, with a heavy emphasis on British Columbia, CN is hiring hundreds of conductors and is expanding its locomotive and rail car fleet, Waldron said.

Cargo interests are rightfully concerned that problems on the rail networks, if not addressed quickly, could lead to a repeat of last winter’s congestion at the Canada’s Pacific Coast ports of Vancouver and Prince Rupert. The Canadian International Freight Forwarders Association (CIFFA) is bracing for a challenging autumn. “Rail networks are expected to be busy to the end of September, early October, with higher than normal dwell times, a CIFFA spokesperson said.

On-dock container dwell times at Vancouver and Prince Rupert, 500 miles to the north, usually run three days or less. Concern was therefore raised on July 11 when Vancouver’s website published metrics for Vancouver’s three major container terminals, Deltaport, Vanterm, and Centerm, showing that container dwell times were in the three- to seven-day range for all of the terminals except the Canadian Pacific on-dock operation at Centerm.

Conditions improved somewhat on July 17, with dwell times of three days or less at Vanterm and three to five days at Centerm and five to seven days at Deltaport. However, the CN operation at Deltaport had the worst times in the harbor of more than than seven days’ dwell time. When container dwell times reach seven days, as they did last winter, marine terminals become congested, and this causes truck, vessel, and rail traffic to back up.

North American Pacific ports rely heavily on rail

Like all of the major gateways on the Pacific Coast of North America, Vancouver is highly dependent upon intermodal rail to move containers to the eastern half of the continent where most of the people live. Prince Rupert is totally dependent upon rail as it has virtually no truck traffic involving containers. Therefore, when severe winter weather earlier this year compounded problems caused by construction projects at the ports, container dwell times spiked, vessels were delayed up to several days from reaching berth, and beneficial cargo owners in eastern Canada and the US Midwest complained of lengthy delays in taking delivery of their shipments.

However, while the construction is under way, the port is experiencing delays that are taking place throughout the rail network. “This has been impacting some velocities through some of the construction areas, and impacting time in getting the cars back to the West Coast,” CIFFA stated.

Prince Rupert, which experienced delays last autumn and winter due in part to construction of a rail facility and completion of a second berth at its Fairview container terminal, is faring much better this year, said Brian Friesen, director of trade development and communications. Average container dwell times the past 90 days have averaged 2.5 days, and an expansion project on the south end of the container terminal that will begin next year is expected to result in “little or no interference” with cargo handling, he said.

The Canadian ports are preparing for another peak season of increasing cargo volumes. Prince Rupert’s total laden containers through June are up 20 percent over the same period last year, with imports 13 percent higher, Friesen said. Vancouver’s first-half container numbers show total volume up 5.1 percent and imports 3.7 percent higher than last year.

The strong cargo growth so far this year is viewed as a challenge to the ports. CIFFA noted that volumes are beginning to ramp up, but they are not at the peak levels anticipated in mid-August.

Contact Bill Mongelluzzo at bill.mongelluzzo@ihsmarkit.com and follow him on Twitter: @billmongelluzzo.



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