Stephen Rees’s blog

Globe and Mail

I am very grateful that the The Tyee has this neat column headed “Reported Elsewhere” which meant I finally caught up with this story. You may have heard that Barrack Obama has gone on record as opposing CN’s acquisition of the EJ&E (”The Juice”) a railway in suburban Chicago that would help it avoid the congestion in the US biggest rail hub.

CN has run into significant public opposition in its bid for approval of the acquisition of Elgin Joliet & Eastern Railway Co. CN wants the rail line so it can bypass Chicago through the suburb of Barrington and cut nearly 30 hours off the time it takes container trains to reach destinations in the American Southeast – and that means a faster route from Prince Rupert into key U.S. markets.

“It certainly would add tremendous market weight to our gateway,” Mr. Krusel said of the EJ&E acquisition. “If they are successful in getting that line, it will be 100 hours [from Prince Rupert] to Memphis. We’ll be just as close in time as L.A./Long Beach – maybe closer.”

But what catches my attention is the broader context. Prince Rupert is not, at the moment, doing very well. Partly that is simply teething trouble with a new facility. But as noted elsewhere, the world is changing too

Prince Rupert is holding its own while other West Coast ports are seeing declines in container shipments now. “A year ago we would have expected a second carrier here,” he said. “That hasn’t happened. Carriers are reducing service on the Pacific, everywhere.

Prince Rupert has plenty of spare capacity and the demand for moving containers from China to the US is declining. So what on earth are we doing pressing ahead with a port expansion at Roberts Bank? There are all sorts of questions raised about its environmental impact and plenty of reason to suspect that whatever studies were done were pre-determined. In BC we seem to think that somehow we are immune and do not need to concern ourselves about ecology. But more than that, why are we proposing to spend vast sums on infrastructure for a port expansion that seems to be destined to be a white elephant.

Prince Rupert has a two day sailing advantage over Vancouver for Asian Pacific trade – and that is important in reducing cost, both inventories and ship’s bunkers. And the CN line through Chicago looks like a lot better bet then the congested lower mainland, where rail investment means the odd overpass here and there – not massive increases in capacity and some very weak links indeed.

By the way, has anyone ever heard one of those management types from Port of Vancouver ever admit that trans pacific container trade was actually declining?