Iron ore exports keep St. Lawrence Seaway shipping on course
A surge of North American iron ore exports to Japan and China is keeping the Great Lakes/St. Lawrence Seaway bustling in the critical months before the shipping season winds down.
Ships will deliver over a million metric tons of iron ore pellets for export via the inland waterway by the end of the shipping season.
“North American mining companies are seizing on opportunities to export iron ore pellets to serve steel production demand in Japan and China,” said Terence Bowles, President and CEO of The St. Lawrence Seaway Management Corporation. “The Seaway is an important international trade conduit that provides efficient, cost-effective transportation for industries like the mining sector.”
Iron ore pellet prices have been rising worldwide partly due to an undersupply following the closure of the Samarco mine in Brazil last year. The iron ore exports are being sourced from mines in Minnesota and the Upper Peninsula of Michigan and picked up at the ports of Duluth-Superior (Minnesota), Escanaba (Michigan), Marquette (Michigan) and Conneaut (Ohio). Domestic carriers Canada Steamship Lines and Algoma Central Corporation are carrying the iron ore via the Seaway to the Port of Quebec, where it is then transferred to larger ocean-going vessels for onward transport to Asia.
The ore exports in combination with a steady flow of Canadian Prairie grain helped lift year-to-date Seaway cargo shipments (from March 21 to the end of October) to 25.8 million metric tons. That is 5 percent down from the same period last year, but an improvement over earlier in the season.
“After a slow start to the season, our entire fleet is now booked out until the end of the year,” said Wayne Smith, Senior Vice-president of Commercial, Algoma Central Corporation. “We were able to move quickly to put more vessels into service to respond to the unexpected demand of iron ore exports. The shipping industry is also well-positioned to deal with the large volumes of Prairie grain expected to come through the waterway over the coming months.”
Shipments of Canadian and U.S. grain hit 7.6 million metric tons (from March 21 to October 31), in line with the healthy volumes experienced in 2015. Canadian Prairie farmers are harvesting their second largest crop in history and the St. Lawrence Seaway is the key export channel to reach European, Middle Eastern and African markets.
The Port of Thunder Bay reported a strong grain haul in October, a third more than its 10-year October average.
“This is the third consecutive year that the port has experienced stellar grain shipments,” said Tim Heney, President and CEO of the Thunder Bay Port Authority. “Harvests are becoming consistently larger due to changing farming practices, and grain handlers are maximizing the investments they have made in Thunder Bay terminals over recent years by exporting more of that grain out through the Great Lakes/Seaway system.”
Recently, another Canadian agribusiness has established a presence at the port. AGT Food and Ingredients is using a loop track facility to export lentils on ocean-going vessels directly to international markets.