Port of Vancouver rail service could resume next week as backlog hits supply chain
Rail service at the Port of Vancouver could resume next week as CN and Canadian Pacific crews worked to repair sections of their networks hit by the devastating floods and landslides in British Columbia while impacts continued to strain the supply chain.
CP (NYSE:CP) said it expects to resume service during the middle of next week. CN (NYSE:CNI) didn’t provide an estimate for restoring service, but said repairs would “continue at least into next week.”
CN and CP’s rail lines serving the port between Kamloops and Vancouver have been out of service this week following a deadly storm that brought heavy rainfall, flooding and landslides. Forty vessels were at anchor at the Port of Vancouver — Canada’s busiest — as of Friday as backlogs of shipments of raw materials, including large amounts of grain, have continued to mount.
“This is more than a standard hiccup,” said Barry Prentice, a professor of supply chain management at the University of Manitoba’s Asper School of Business. “I don’t know how long it’s going to take to fix this. But it’s not going to be quick, cheap or easy.”
Global shipping line Maersk warned customers that the impacts at the port could last for weeks.
“We will see increased congestion at terminals and expect vessel delays,” Maersk wrote in an advisory Friday.
Meanwhile, the damage and flooding from the storm have closed roads throughout the province, limiting truck access to the port as well as to the rest of Canada. Trucks have been rerouted through the U.S. to reach the port and support relief efforts.
Agreements between U.S. Customs and Border Protection and Canada Border Services Agency officials have allowed Canadian trucks to transit through the U.S. to reach British Columbia.
CN also has been working with customers to utilize the Port of Prince Rupert, which remains accessible.
The disruption has compounded the strains from the demands of record volumes of bulk cargo and containers. The port reported a 24% increase in container volumes and a 7% increase in overall cargo volumes for the first six months of 2021.
This is the second time in less than a year that the port has seen a significant disruption due to weather. Wildfires over the summer snarled CN and CP’s rail service.
“The supply chain will go back to normal, but climate change has its fingerprints all over this event in Vancouver,” Prentice said. “I guess now we should just start to expect some kind of a disruption happening at least every year.”