VANCOUVER, BRITISH COLUMBIA--(Marketwired - Aug. 19, 2016) - A softened global economy, the weakened Canadian dollar, and some containerized cargo shifting back to United States ports following an extended labour disruption on the U.S. west coast last year are primary factors contributing to lighter than usual traffic through the Port of Vancouver, according to the port authority's 2016 mid-year statistics report released today. Despite the short-term slow down, forecasts show that long-term growth in trade will continue to bolster the Canadian economy.
Total cargo for the half-year ending June 30, 2016 was 66.0 million metric tonnes, an overall decrease of 5.9 per cent over the same period in 2015. These results represent a softening of volumes in all major commodities except grain, where increases in barley (up 41.8 per cent) and canola (up 40.1 per cent) contributed to overall growth in that sector.
"The slight decrease in cargo volumes in the first half of 2016 is expected, given the record year we experienced in 2015 and the softening global economy," said Robin Silvester, President and CEO of the Vancouver Fraser Port Authority. "The long-term outlook for Canadian trade is one of growth, and the port will be ready to handle increased volumes through Canada's west coast."
In the bulk sector, more grain is being exported overseas to new markets resulting in an increase of 4.8 per cent over record 2015 volumes. Supported by a bumper harvest and strong overseas demand, Canadian bulk grain exports through the Port of Vancouver have had back-to-back record years in 2014 and 2015.
Reduced investment due to a slowdown of industrial activity in western Canada, along with the weakened Canadian dollar, led to an 11.7 per cent decrease in volumes of machinery, vehicles and construction materials moved through the Port of Vancouver. Other resource-based decreases include a 38.7 per cent drop in exports of power-generating thermal coal to key Asian markets. However, metallurgical coal, which made up approximately three-quarters of total coal volumes, saw a much smaller decrease of only 4.1 per cent.
In the container sector, volumes weakened in the first half of 2016 compared to last year, when the port experienced a temporary surge of cargo in 2015 as shippers chose to move freight through Canada due to labour disruptions at U.S. west coast ports. Between January and June 2016, 1.4 million container TEUs (twenty-foot equivalent units) moved through the Port of Vancouver, representing a decrease of 6.5 per cent from the same period in the record-breaking 2015 year. Compared to 2014, 2016 volume is up 1.3 per cent.
Changes in Canadian consumer behaviour in the first half of this year, in part as a result of weaker purchasing power due to the reduced value of the Canadian dollar, led to a 2.5 per cent decline in containerized imports of consumer and related goods, most notably household goods.
Ocean Shipping Consultants, a U.K.-based economic consultancy, recently completed an independent forecast of container traffic through the west coast of Canada that considers emerging global economic trends and data. The report predicts growth in containers from 2016 to 2030 at four per cent annually. At that rate, the Port of Vancouver will need to create additional terminal capacity by the mid-2020s.
The Vancouver Fraser Port Authority and terminals within the Port of Vancouver continue to invest in infrastructure and technology to increase capacity in anticipation of growth. In addition to improvements to maximize the use of existing container terminals, the port authority is proposing to build a new terminal at Roberts Bank, a project now being reviewed by an independent review panel appointed by the Federal Minister of Environment and Climate Change.
"Shippers continue to express confidence in the Port of Vancouver, and we continue to see significant investment projects moving forward in the gateway," added Silvester. "We wish to thank all our many customers and terminals for working with us to provide an efficient and reliable supply chain and to plan for the future."
For more information
• 2016 mid-year Cargo Statistics Report [PDF]
• 2016 Container Forecast, Ocean Shipping Consultants [PDF]
• Vancouver Fraser Port Authority Reporting and Statistics
• Photos for download
Overall cargo traded through the Port of Vancouver declined in the first half of 2016, posting a 5.9 per cent decrease in tonnage compared to the first half of 2015.
Auto volumes stayed flat showing a 0.3 per cent decrease versus mid-year 2015, with 211,613 units moved through the port so far in 2016.
Breakbulk cargo declined by 11.0 per cent, most notably due to decreases in forest products (down 8.7 per cent), construction and materials (down 32.5 per cent) and miscellaneous goods (down 12.8 per cent). These decreases can be attributed, in part, to reduced investment in the energy industry in Alberta and a shift in moving cargo by container after the 2015 U.S. west coast labour disruption.
Bulk dry cargo of 41.6 million tonnes represents a 6.1 per cent decrease over mid-year 2015. Large increases in canola (up 40.1 per cent), and specialty crops (up 19.8 per cent) offset decreases in thermal coal (down 38.7 per cent). Sulphur and minerals volumes increased 6.9 and 11.2 per cent respectively over 2015.
Bulk liquid tonnage was slightly down by 0.4 per cent over this time last year. The sharp decrease of 53.3 per cent in crude petroleum exports is consistent with the fall in global oil prices. This is offset by increased gasoline volume of 50.0 per cent, organic chemicals (up 8.9 per cent) and vegetable oil (up 6.7 per cent).
Container TEUs decreased by 6.5 per cent due, in part, to some cargo shifting back to United States terminals after labour concerns on the U.S. west coast in 2014 and 2015 caused an increase in containers handled through Vancouver in the first half of last year. However, overall container volumes so far this year are showing a 1.3 per cent increase over 2014 mid-year volumes.
The decline against 2015 stats is expected to be temporary and recover along with the global economy. According to an Ocean Shipping Consultants report that considers emerging global economic trends and data, continued growth in container trade through the west coast is expected at a compound annual growth rate of about four per cent annually. The report forecasted that container demand through the west coast of Canada would be between 5.93 and 7.53 million TEUs in 2030.
The port authority continues to plan ahead to maximize efficiency and build capacity within the Port of Vancouver while working to minimize community and environmental impacts of port operations. The proposed Centerm Expansion Project is in the pre-application consultation phase and the Environmental Impact Statement for Roberts Bank Terminal 2 project is being reviewed by an independent panel.
YTD June cruise passenger traffic is up 9.2 per cent at 341,710 for 2016 versus 2015. The 2016 cruise season is projected to be strong, with an estimated 830,000 passengers on 228 visits, reflecting a 3.0 per cent increase in passenger volume over 2015.
Foreign vessel calls were down in the first half of 2016 by 2.9 per cent over the same time last year, with 1,497 calls.
About the Vancouver Fraser Port Authority
The Vancouver Fraser Port Authority is responsible for the stewardship of the federal port lands in and around Vancouver, British Columbia. It is accountable to the federal minister of transport and operates pursuant to the Canada Marine Act. The port authority manages the Port of Vancouver, which is Canada's largest port and the third largest tonnage port in North America, responsible for Canada's trade with more than 170 world economies. Located in a naturally beautiful setting on Canada's west coast, the Port of Vancouver is responsible for the efficient and reliable movement of goods and passengers, and integrates environmental, social and economic sustainability initiatives into all areas of port operations. Enabling the trade of approximately $200 billion in goods in 2015, the port sustains an estimated 100,000 supply-chain jobs, $6.1 billion in wages, and $9.7 billion in GDP across Canada.