Pulse Canada is keeping an eye on container supplies following the recent announcement by a major supplier it would be shipping them back empty to Asia from North America to meet a surge in demand.
Why it matters: Canadian pulse crop exporters rely on shipping containers to get their products to international customers. A lack of them could delay affect sales and pulse crop prices to farmers.
The American-based Specialty Soya and Grains Alliance said Oct. 23 its “members were shocked to learn this week that shipments of agricultural products by containers are being discontinued by a major shipping line, effective immediately and for the foreseeable future.”
The alliance called the German international shipping and transportation company Hapag-Lloyd’s decision to suspend overseas container shipments from North America a “bombshell,” adding it would hurt members, especially in the upper Midwest.
The alliance said the decision is driven by “hard economics during a time of unprecedented demand for higher-value North American consumer imports by containers from Asia at premium prices… even if it means forgoing hauling critical food and agriculture products back to manufacturers overseas.”
Pulse Canada is aware of Hapag-Lloyd’s decision, Jeff English, vice president of marketing and communications, said via email Wednesday.
“Pulse Canada is working with our members and industry partners to actively monitor the impact of this decision,” he wrote, adding that it was a temporary measure.
“We understand this was a business decision made due to capacity issues.”
Canada’s pulse sector relies heavily on service providers such as steamships lines and railways to get products to markets around the world, he wrote.
“Decisions like these have a real impact on our international competitiveness,” English wrote. “From our perspective, this further underscores the need for a timely and serious conversation about investing in and improving the resilience and effectiveness of Canada’s transportation infrastructure and trade corridors and gateways.”
According to one industry official, COVID-19 delayed Asian shipments to North America earlier this year and they’re trying to make up for it now to fulfill increased Christmas demand. That should mean more containers will be available for pulse crop exporters in the new year.
Even container stuffers at Canada’s West Coast ports are affected, according to the official. Normally that’s not the case because of the quick turnaround between unloading incoming containers and filling them with pulses to ship back to Asia.
Although pulse and special crops account for most of the Canadian grain exported in containers, others such as identity-preserved crops also rely on containers.
Last crop year about 11 per cent of Western Canadian grain was exported via containers, compared to just 2.5 per cent in 1999-2000.
— Allan Dawson reports for the Manitoba Co-operator from Miami, Man.