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Pacific Pilotage Authority To Increase Fees…Again

On September 29, the Pacific Pilotage Authority (PPA) published its Notice of Revised Service Charges for next year, outlining proposed revisions to the pilotage charges for 2024. With the main increases tied to negotiated contracts linked to Consumer Prince Index, the PPA is proposing a 5% increase to hourly and unit fees and a 4% increase to pilot boat.

These increases follow the PPA’s rate hike of almost 10% at the beginning of 2023.

Given these substantial increases to PPA tariff and the number of vessels now shifting between remote anchorages and Vancouver Terminals, which lead to significantly longer job times and orders requiring pilot changes, the pilotage charges have become a noticeably significant factor in overall port cost for vessels calling the Port of Vancouver.

As stated in the Notice, the deadline for feedback to the latest proposed changes is October 29, 2023.

Panama Canal Transits Limited by Climate Change

The Panama Canal Authority (PCA) is further reducing the maximum number of ships that can transit the waterway each day from 32 to 31. The previous limit of 32 ships per day was only put in place of August of this year, which was a decrease from the traditional average of 36 to 38 ships daily.

Starting November 1, nine ships per day will be allowed to use the new, bigger NeoPanamax locks and 22 per day will be handled through the older Panamax locks. Vessels transiting the Panamax lokcs will also face a tighter maximum draft restriction of 13.4112m (44 feet), down from the standard max of 15.24m (50 feet).

These restrictions to one of the world’s main maritime trade routes are a result of severe the drought conditions in the region and are expected to be exacerbated by the return of the El Niño weather phenomenon this year, which led to the PCA strengthening their water conserving measures.

Each ship transiting the canal requires approximately 200 million litres of freshwater to move it through the system of locks. The water comes from Gatun Lake, an artificial freshwater lake that is supplied through a watershed of rivers and brooks.

But after an unusually dry year, the level of water in the lake is currently estimated at 80 feet, down from its average of 87 feet for this time of year. This watershed also supplies freshwater to Panama City, home to about half the country’s 4 million people.

The latest restrictions are expected to be in place for at least the next 10 months and will affect shipping schedules and capacity utilization. Container services and cruise ships are impacted differently due the booking system where as bulk ships will face greater disruptions due to short notice and the need to queue.

Port of Vancouver Grain Exports Double In First half of 2023

 

The first half of 2023 has seen a reported 11% growth in total cargo moving through the Port of Vancouver with bulk cargoes representing 55.5 million tonnes of the 75.9 million tonnes that were shipped. In particular it has been grain cargoes that have seen the most substantial increases moving through the port from last year to this one.

Grain exports have more than doubled in the first 6 months of 2023, with 16.36 million tonnes shipped, up from 7.94 million tonnes over the same time period in 2022. Wheat accounted for 7.86 million tonnes (up 144%), or nearly half of the volume moved through the port, with canola coming in a distant second at 3.81 million tonnes (up 124%). Exported specialty crops also saw a significant boost during this period with 2.57 million tonnes (up 67%) being shipped.

The sharp increases to these numbers reflect the relative bumper crop from the Canadian Prairies in 2022 and their recovery from drought conditions the previous year.

Expected shipments for the second half of 2023 are however a little uncertain, given the expected smaller crop. Statistics Canada estimates Canadian farmers harvested 83.87 million tonnes of grain, oilseeds, pulses and special crops for 2023, a 13% decline from the previous year.

Exports of potash and fertilizers remained stable in the first six months of 2023. Volumes for potash were down about 6% over the first six months of 2022, while sulphur was up by 20%.

Inbound container traffic at the port fell 17% in the first half of 2023 compared to a year ago, however there was a 27% drop in empty containers heading out of the port and a 14% increase in loaded container exports from Vancouver.