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First publish date: 2004-04-10

CPR Container Delays Originate in Vancouver

Surging volumes of cargo from China combined with a shortage of rail cars has led to a record backlog of container traffic at the Port of Vancouver, the chief executive of the Vancouver Port Authority said.

"This is unprecedented," said Gordon Houston, adding that ports across the entire West Coast are experiencing similar troubles. "We have entered this period of very high volumes of cargo and it's stressing the entire logistics chain. The chain wasn't set up to handle this type of volume," Mr. Houston said.

Vancouver is a major international gateway for cargo headed inland to the rest of Canada and the United States.

In recent years it has experienced substantial growth in business from China, South Korea and other Asian countries, and it recently embarked on a multi-billion-dollar program to increase its capacity.

The length of delay at the port depends on to whom you talk. But Steve Valentine, president of Cargo Alliance Ltd., a Toronto-based freight forwarding company, says a container that used to take 26 days to get from Hong Kong to Toronto now takes up to twice that time. "People require product on a very consistent basis, and it's not happening."

Containers are mostly used to carry consumer goods that are increasingly manufactured in China and South Korea to markets in North America. "Everything you see in Wal-Mart or The Bay comes out of a container," said one industry insider.

Mr. Valentine said growing container traffic is only part of the problem. He said the bottleneck at Vancouver is caused primarily by a shortage of rail cars at Canadian Pacific Railway Ltd.

He said a month-long strike at Canadian National Railway Co. in the winter caused some shippers to divert their traffic to CP, for fear the disruption would last longer than it did.

"What you're seeing at the Port of Vancouver is a situation similar to [other West Coast U.S. ports]," said Jim Fairweather, vice-chairman of the B.C. Chamber of Shipping. "But the issue in Vancouver is primarily a shortage of rail cars to meet the demand, and the problem is primarily CP's."

A spokesman for CP confirmed the company is experiencing delays. "We are congested in the Vancouver area," said Len Cocolicchio. "There's tremendous volumes of container traffic coming at us at the same time as we are experiencing extremely high volumes in virtually all areas of our business."

Mr. Cocolicchio said he does not know how long the freight delays out of Vancouver are, but said CP is working to correct the problem.

A spokesman for CN said the railway's operations are running smoothly and freight is not being delayed.

Observers said CP's rail car shortage was worsened by a series of avalanches on its main line into the Port of Vancouver, from which it is still recovering. "There was bad weather, strikes. Everything that could go wrong did," Mr. Houston said.

The port of Vancouver normally handles about 15,000 feet of containers a day, he said. But the stacks of containers sitting on the dock is equivalent to about 250,000 feet, he said. "We're looking at 45 or 50 miles of traffic [backlog]."


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