By Bruce Wood, President and CEO, Hamilton Port Authority
In 2008, Hamilton Port Authority (HPA) charted a new strategic vision: to be the Great Lakes Port of Choice, with an ambitious set of goals over a 12-year horizon to 2020. The plan highlighted investment in port infrastructure, as well as cargo diversification and land development.
Five years into the mandate, we are ahead of target on virtually every count. But it hasn’t always been smooth sailing; global economic turmoil has had substantial effects on southern Ontario’s manufacturing sector, and especially Hamilton’s steel industry.
The Port of Hamilton was established to serve the city’s two great steel companies a century ago, and grew along with them for many prosperous decades. The latter half of the 20th century saw the City of Hamilton begin a process of transition from “Canada’s steel city” to a more diversified economy. Steel has always been a cyclical industry, and continues to experience ups and downs, so diversification is a prudent strategy in all economic climates.
While steel remains an important part of port business, variety in cargo insulates against volatility and brings new investment and employment to the region. Since 2008, non-steel cargo has grown by more than a million tonnes.
We have made a concerted effort to connect with tenants who derive strategic value from access to the port and harbour facilities. Major tenants such as McAsphalt, Aecon/Dufferin, and others have invested in facilities that leverage the port’s strategic location to give them an edge in their businesses. In turn, it makes sense for these companies to invest in facilities and infrastructure as part of a long-term commitment. Together, HPA and its tenants have invested more than $200 million in recent years. It has been a highly successful strategy – so much so that we are beginning to run out of available space. Our focus now turns to acquiring new properties that will appeal to the Port’s increasingly diversified customer base.
HPA continues to work hard to attract new tenants and grow existing ones, resulting in success stories across growth sectors such as construction materials, petrochemicals and biofuels, and agricultural commodities.
Tenant highlights:
• Under the new brand Yellow Line, construction leaders Aecon Group and Dufferin Construction Ltd. operate a 10 acre asphalt processing plant on Pier 22, with rail and marine links, and access to major trucking routes.
• McAsphalt invested $20 million in its new asphalt terminal at Pier 23. The company leverages the port’s strategic location to serve the GTHA construction market.
• Vopak’s busy Hamilton terminal offers 165,000 cubic metres of capacity for a variety of liquid bulk commodities, such as diesel, gasoline, jet fuel, and agri-food liquids.
• Expansions at the port’s grain handling terminals, operated by Parrish & Heimbecker and Richardson International, and oilseed crusher Bunge are contributing to the port’s emergence as a major agri-food hub in southern Ontario. Agricultural cargo tonnages have doubled from 815,000 tonnes in 2009 to 1.62 million in 2012. Agricultural commodities now represent 16 per cent of the port’s total tonnage, up from 9 per cent in 2009.
• The expansion of terminal capacity for fertilizer is the other major component of agricultural commodity growth. Hamilton now serves as a major entry point in southern Ontario for this important agricultural input. More than 400,000 tonnes of various types of fertilizer were shipped through the port in 2012, a 27 per cent increase over 2011. Terminal expansions like the new 20,000 tonnes capacity storage domes at Sylvite Agri-Services help create the conditions for a globally competitive agri-food industry in Ontario. Storage terminals play a critical role in facilitating the movement of commodities, and ensuring beneficial pricing for Ontario agricultural producers.
Project cargo has been another area of growth for the Port, with volumes handled tripling in 2012 relative to 2011. We all know the struggles the manufacturing sector has endured, but the green shoots are emerging. Advanced manufacturing will continue to be at the heart of the regional economy, and the Port will continue to support this engine of prosperity by getting those goods to global markets efficiently. It is a long-term process, but the steady shift to a fully diversified cargo mix is well underway. By the end of 2012, non-steel cargo represented a full quarter of the port’s tonnage, with an increasingly profitable composition of high-value cargoes. We’re at the forefront of what is happening in the broader economy. The companies that are setting up shop at the port today are making significant financial commitments and long-term investments. It demonstrates a level of confidence that these sectors will be growing and thriving in years to come.