By Brian Dunn

There are many river corridors around the world, but the St. Lawrence River is unique among them as it features ocean ports and not river ports along the entire system, due to the depth of the river.

“You can have Panamax ships in Montreal, which is not true for other rivers,” Université de Montréal professor and scientific consultant to Montreal Port Authority, Claude Comtois, said during a presentation to the Institute of Chartered Shipbrokers in Montreal on Oct. 28. In addition, half the traffic on the St. Lawrence is bound for international markets, 25 per cent for continental trade and the remaining 25 per cent is destined for the domestic market, “so the St. Lawrence is extremely well integrated into international trade,” he pointed out.

But there is glaring problem. The port of Montreal is not keeping pace with the growth rate of world maritime trade and the St. Lawrence overall is growing even less than Montreal. “The St. Lawrence is underutilized by 50 per cent of its capacity and that may be why Montreal is not growing as fast as world trade,” said Mr. Comtois. While he applauds Quebec for launching its Maritime Strategy, the initiative doesn’t go far enough to keep Quebec “in the game” and he cites several examples around the world that go much farther. “A maritime strategy does not operate in a vacuum with its different sectors, such as ports, transportation and logistics. There are a lot of issues and you can’t tackle all of them,” said Mr. Comtois.

China underwent major reforms in the late 1970s and opened its doors to outside investment, realizing it couldn’t go it alone. As a result, port terminals were opened up to different partnerships like Singapore and Hong Kong and different shipping companies like Maersk. With new partnerships, China became more productive and more competitive, noted Mr. Comtois.

On a local scale, Shanghai’s port was not deep enough, so it built a new port on Yanshi Island that handles 20 million TEUs. Each terminal has different berths operated by different stevedoring companies to spur competition among them.

Until recently, the domestic fleet in New Zealand had a monopoly on coastal operations, but the government decided to open up those operations to international players. As expected, there was an uproar about job losses, port closings and bankruptcies. Actually, quite the opposite happened. Maersk for one, incorporated New Zealand in its Singapore to Australia service. “There were major investments and many shipping companies increased their profits and New Zealand is now a major player in the TPP (Trans-Pacific Partnership.) Would we have a problem with South Koreans operating on the St. Lawrence?” Mr. Comtois asked rhetorically.

In the 1960s, Singapore had a single port. In 1997, the Singapore government established Port of Singapore Authority (PSA) to develop a global portfolio. Today, PSA is the second-largest terminal operator in the world, handling over 100 million TEUs over 66 kilometres of berths globally, Mr. Comtois pointed out.

The Marco Polo program Phase 2 in the European Union was introduced to develop short sea shipping and remove physical and regulatory barriers for road and rail traffic. The EU is investing 130 million Euros a year in the program, with 60 per cent dedicated to logistics and 40 per cent going towards new infrastructure.

“What are we investing in the St. Lawrence system?” Mr. Comtois asked. “The Netherlands has an office just to answer questions from truckers on the best route to move goods from Point A to Point B. They have adopted a maritime strategy based at the Port of Rotterdam (Maasvlakte 2) where they have expanded the port into the sea by creating a peninsula. They want to become the main energy terminal of Western Europe. They believe biomass is the biggest trade of the future.”

Back in 1988, the German city of Duisburg launched Logport to develop unused industrial space into modern logistics centres with major partners including the ports of Antwerp and Rotterdam. Today, there are about 50 companies established on the site, including Kühne + Nagel, DB Schenker, DHL and NYK / Yusen Logistics. In addition to three intermodal terminals, there is a warehousing area of approximately 650,000 square metres on the site, including more than a half dozen European distribution centres for companies such as Danone Water, Hewlett Packard, Johnson & Johnson and Siemens. Since 1999 there have been over 4,000 direct jobs created at Logport.

Some U.S. west coast ports such as Los Angeles are so congested that shipping lines are imposing surcharges to offset the cost of delays to load and unload which could benefit Vancouver or Price Rupert as alternative offloading sites, suggested Mr. Comtois. Other ports face the problem of underutilized equipment which must be addressed to increase productivity.

“When negotiating new (labour) contracts, you have to come up with new measures to increase the flow of traffic and improve productivity. The idea is not to confront labour but to ask them to help find solutions.” As an example, Southampton in the U.K. reached an agreement with its stevedores to coordinate their work schedules to coincide with the arrival and departure of ships instead of the usual 9 to 5 shifts, thereby eliminating a lot of downtime, and increasing productivity from which everyone benefits.

Mr. Comtois highlighted the necessity for major infrastructure spending on the St. Lawrence, specifically to earmark funding for dredging to a depth of 13 metres to allow larger vessels to call on various ports along the river. “We have no choice but to invite foreign investment as part of infrastructure improvements, because of the Canadian government’s austerity program and we can’t compete with our current infrastructure which is becoming obsolete. If you build it, they will come.”