By ALEX BINKLEY
Signs of recovery in the North American economy have the shipping industry cautiously optimistic about the prospects for the 2012 navigation season on the St. Lawrence Seaway-Great Lakes System, which begins March 22nd.
Considering the shaky state of the world in 2011, the Seaway’s 2.5 per cent growth compared to 2010, with cargo tonnage up to 37.5 million tonnes, was a credible performance.
Collister Johnson, Jr., Chief Administrator of the U.S.-based Saint Lawrence Seaway Development Corporation, says that there is no longer a fear of a double-dip recession in the United States. In addition, 2011 produced an 8 per cent increase in transits, “which is a good upward sign.”
This evidence leads Mr. Johnson to forecast a modest increase for this year “taking in all the factors.” One major uncertainty is the level of grain exports because of strong harvests in other exporting countries and the end of the Canadian Wheat Board (CWB) monopoly in August 2011.
Raymond Johnston, President, Chamber of Marine Commerce, says the outlook for the 2012 navigation season “appears positive. By all accounts, things look up. Shipments could be up by 5 per cent.” Prospects for most bulk commodities remain in good shape, although he echoes Mr. Johnson’s concern about grain shipments because of the CWB situation.
“The United States’ economy has looked better lately with manufacturing rates on an upswing,” Mr. Johnston continues.
Michael Broad, President, Shipping Federation of Canada, says predicting 2012 is a difficult call. “The U.S. economy seems to be turning up. From what I hear, the first half of the year will be like last year.” After that, it’s difficult to predict.
The Seaway started strong in 2011, he adds in an interview, but trailed off in the final months. “There’s vitality in the Seaway when iron ore and steel are moving.”
The European financial situation complicates forecasts for the Seaway-Great Lakes as well, he points out. One positive sign is that ocean freight rates are down and shipping lines are looking for business. If the U.S. economy picks up more momentum, especially on the export side, then ship-owners will be looking for business.
A survey of economic forecasts for 2012 underscores the cautious shade to the shipping industry’s optimism.