By William Hryb

For the port of Thunder Bay, a familiar sight on the waterfront is the infamous Sleeping Giant. The magnificent rock formation was voted one of the Seven Wonders of Canada in a national competition several years ago. Over the past several seasons another recognizable sight is the name Wagenborg emblazoned on ships’ hulls that are increasingly frequenting the Lake Superior port. With the changing dynamics in the shipping industry, niche carriers like Royal Wagenborg B.V. have managed to stay in the forefront of a rapidly changing industry.

imageSmaller cargoes in the range of 8,000 to 12,000 tonnes appear to be a trend that will likely continue for the foreseeable future. With low water level issues in the Upper Great Lakes, larger ships in the 35,000-tonne capacity are finding it difficult to load to their potential because of chronic low water levels. Wagenborg’s fleet consists of over 160 vessels, ranging in size from 1,000 to 20,000 tonnes. The Dutch company has revolutionized the dry-cargo segment with ice-strengthened bulk carriers and multipurpose vessels.

Wagenborg’s reputation for exemplary cargo-handling has served the shipping community well. Shippers around the globe have discovered that they can count on this company to ‘cut the cloth to fit the suit’ and deliver their cargo in a timely and cost-efficient manner. One look at port activity in Thunder Bay in early December shows just how Wagenborg has become a welcome sight at the Lakehead port. Arrivals of MV Edenborg on December 1st, followed by arrivals of MV Eeborg and MV Fuldaborg on December 7, 2012 were an impressive show of ship presence, to say the least.image

During the past decade, the number of transits of Wagenborg ships through the Great Lakes has been growing steadily. The arrival and loading of the Edenborg, Eeborg and Fuldaborg exemplified the ever-expanding role Wagenborg plays at the port. With the arrival of MV Edenborg, the Port celebrated a renaissance of sorts when the largest wood pulp shipment ever was loaded. Given the downturn in the forestry sector in Northwestern Ontario during the past decade or so, the 8,800-tonne shipment was a welcome sign that a rebound in the pulp-and-paper trade was in effect.

The wood pulp was produced at the Terrace Bay pulp mill located on the North Shore of Lake Superior, about 120 miles from Thunder Bay. The community of 1,700 has a long history in the forestry sector when Longlac Pulp & Paper Company was established in the 1940’s. The mill was later renamed Kimberly-Clark Forest Products..

In 2005, the company was sold to Neenah Paper Inc. which in 2006 sold the mill to Buchanan Forestry Products. The mill changed names to Terrace Bay Pulp Inc. and operated until 2009 when it shut down because of financial hardship. In late 2010, after a major financial reorganization, the mill reopened with strong markets, only to be idled once again when an explosion occurred following completion of the annual 2011 maintenance shut-down, causing the company to be put up for sale.

In July of 2012, the Aditya Birla Group of Mumbai India agreed to purchase the mill and invest $250 million into the operation, to convert the plant to produce dissolving pulp, and the mill was re-incarnated under the name AV Terrace Bay Inc. Community and business leaders believe the investment will be a tremendous boom to the region ending the uncertainties of the past decade.

It didn’t take long for the new company to get into production this past October, and PKO Cargo was invited to research and advise on export strategies. PKO Cargo International is a well-established freight forwarder based in Mississauga that specializes in trade between Canada and Europe. Peter Taran, owner and President of PKO said, “Our efforts resulted in chartering the biggest vessel for wood pulp shipment via the port of Thunder Bay to date, Wagenborg’s 10,750-tonne MV Edenborg

Loading of 8,793 tonnes of baled wood pulp bound for Antwerp began on December 3 and was completed on December 6, 2012. “The shipment is even more remarkable, since the first wood pulp bale was produced on October 10, 2012 … our hope is that this is the first of many shipments to Antwerp where a distribution centre was set up by us to serve final receivers in Europe,” Taran said.

Canadian Sailings sat down with Tim Heney, Thunder Bay Port Authority CEO, and Vasko Popovic of Logistec Stevedoring for a question and answer session.

CS: What is the significance of this wood pulp shipment for the port?image

Heney: “This has been the first kraft pulp shipment at Keefer in some time and one of the largest shipments in recent history for us. This shipment is important in many ways. Our ability to efficiently handle pulp will contribute to the viability of the Terrace Bay mill by providing competitive access to world markets. The success of the mill is critical to the economy of the North Shore. Repeat shipments will bring more ships to the port and all of the economic impacts that they bring with them.”

CS: Port of Thunder Bay has developed a strong reputation for exemplary cargo handling, i.e. special project cargo. Please give us an idea how the port achieved this distinction.

Heney: “Our success in project cargo is a combination of many factors including investment in infrastructure, partnerships with railways, trucking companies and freight forwarders, skilled iron workers and tradesmen, and a flexible work force. When these factors are combined with proper planning and risk management, a value proposition for the shipper is created. One must be competitive to attract business on the Seaway.”

CS: What future do you see in the continuation of shipments of wood pulp?

Heney – We are hopeful that we will see repetitive pulp shipments through the port. Our new shore crane should provide a distinct advantage, and increased volumes will give us the opportunity to ramp up our productivity and reduce cost to the customer. We have excellent infrastructure at Keefer, and we are constantly upgrading cargo handling capability.

CS: Wagenborg has played an increasingly larger role in all areas of shipping at Port of Thunder Bay. Please give us your comments on this new dynamic.

Heney: “Wagenborg is a frequent visitor to the port. Its ships are flexible and can easily handle a variety of cargo. The relatively small size of its vessels appeals to a wide variety of shippers. The first vessels loaded and unloaded by our new crane were Wagenborg vessels, and we believe that this type of vessel, when combined with the capability of the new shore crane, can lead to a regular liner service between Thunder Bay and Europe, which we believe will generate new opportunities for cargo diversification in the port. Our quest in recent years has been to increase inbound cargo destined for Western Canada to take advantage of our readily available backhaul cargoes of grain, potash, coal, and now pulp.”

CS: Logistec Stevedoring has been involved in shipping wood pulp in the past. Kindly give us your comments on this ­shipment.

Popovic: “The 8,800-tonne shipment is significant tonnage for us as previous shipments were smaller lots of about 2,000 tonnes. We hope it is the beginning of something that is more of a regular service in nature, every six weeks or so.”

CS: How did loading go from a stevedoring standpoint?

Popovic: “Loading progressed as planned, and was completed within estimated time. Two gangs worked with shore cranes which was somewhat new to us, but we were quite happy about all aspects of our operation. Maybe some minor adjustments within the terminal side of the operation would be considered for future opportunities, especially if this is to become repeat business.”

Rick Groves, Vice-President of fibre supply and government relations for A.V. Terrace Bay, is optimistic about the future of the mill. Although the mill is still two years away from producing the product its owners had in mind, the mill is currently operating at full capacity producing Northern bleached softwood kraft, and employs approximately 270, combining those working in the mill and woodlands. “We were lucky to be able to track down a lot of former employees, people who were already familiar with the operation”, said Groves.