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Stakeholders from wheat and canola exporters to lumber producers are worried, as demand for Canadian grain, potash and coal surges due to shortages caused by the Russian invasion of Ukraine. “The amount of rail capacity that there is with various rail lines, that really is what's making a big impact,” said Xotta. is expected to return to the historical average this year, raising questions about what other shipments might be sidelined to accommodate the larger harvest. The grain yield - often the biggest source of commodity revenues for Canadian National Railway Co. Grain volumes were down last year due to a drought, but rail companies “still had problems,” said John Corey, president of the Freight Management Association of Canada. Shippers and marine carrier operators see rail as a critical bottleneck. said earlier this month that its merchandise levels shot up 18 per from a year earlier, which means it has less flexibility for storing off-season items. Once the sales window is over for these seasonal products, they either need to be physically stored until the following year or heavily discounted.Ĭanadian Tire Corp. “If the goods show up two months later than when they're anticipated, you might be missing that window for these barbecues, for parasols, for garden furniture that you were looking for in June,” said Daniel Dagenais, vice-president of operations at the Port of Montreal.

And that actually amplifies the challenge,” Peter Xotta, head of operations at the Vancouver Fraser Port Authority, said, citing what he called a “bull-whip effect.” “When people anticipate a shortage or capacity constraint, they overcorrect.

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Ironically, the delays brought on by full warehouses are partly the result of importers’ response to previous supply-chain disruptions. Storage fees, contract extension penalties and 'demurrage' fees - issued by a shipping line when freight exceeds the time allotted at a terminal - eventually show up in the retail price tag, on top of higher freight rates and overtime wages for those working on the backlogs. “Ultimately the consumer will pay the price for that,' he said. And maybe it is a critical part for a manufacturing operation. 'The problem is, there’s something behind it that can't get through to where it needs to go. “Warehouses in Ontario and Quebec are largely full,” said Lewis-Manning. In Montreal, Canada's second-largest port, containers wait four times longer than the 2019 average, and vessel turnaround is similarly well above both 2019 levels and those from a year ago.Ī lack of storage space in distribution hubs on the fringes of Toronto, Montreal and Vancouver is one reason. “They’re piled up and there's just no more place to put them.' Chamber of Shipping, of shipping containers. “It's like Lego bricks,” said Robert Lewis-Manning, president of the B.C. Meanwhile cargo vessels sat at anchor for 9.6 days on average before docking at the country’s largest port as a result of the buildups last month, more than twice as long as they waited last year. That “dwell time” rose higher in July, to more than six and a half days. But containers sat on its docks for nearly six days on average, almost twice as long as in 2019 and a 41 per cent increase from 2021. In the first half of 2022, container volumes at the Port of Vancouver dropped seven per cent from the same period a year earlier. Ultimately the longer wait times, and extra costs, are being passed along to consumers. The delays stem from several choke points along the chain, including backed-up warehouses, staff shortages and rail capacity. The pandemic sent shockwaves through the global supply chain and the backlogs are mounting even as freight volumes fall in North America this year. I can't get the string that I need to fix it.’”īallantyne isn't alone. 'He says, ‘You know, supply chain issues. MONTREAL - Bob Ballantyne broke a cord on his blinds in early July, and his repairman in Ottawa still hasn’t been able to replace the snapped part.