Vancouver port traffic dips in 2022, signalling towards a recesssion
Container traffic in Canada has continued to drop off as Canadians tighten budgets amid higher interest rates and ongoing inflation.
Cargo volumes at Canada’s largest port fell by three per cent last year as the global economy began to show signs of a slowdown.
Though grain and fertilizer exports surged in the second half of 2022, the gains were not enough to offset a sputtering start to the year caused by a weak 2021 harvest and lingering supply chain problems, the Vancouver Fraser Port Authority said Monday.
After more than a year of rising container traffic, imports also declined by four per cent amid softer consumer demand and overstocked inventories, port authority CEO Robin Silvester said in a phone interview.
Despite the decrease, he stressed that more capacity is “desperately needed” due to rising trade and population forecasts down the line. A new container terminal that would boost that capacity by nearly 50 per cent, dubbed the Roberts Bank Terminal 2 Project, received federal cabinet approval last month but still requires various permits to proceed.
A green light from the Department of Fisheries and Oceans is expected to take at least a year, he said, with permits also needed from B.C.’s Environmental Assessment Office.
Cruises were one area to come roaring back after a two-year hiatus, with a record 307 vessels dropping anchor in Vancouver — though the number of passengers still fell 24 per cent below 2019 levels.
The cruise-ship wave shows no signs of ebbing, Silvester said from his waterfront office, where the Grand Princess, Koningsdam and Norwegian Jewel were visible through the window. Meanwhile a bumper grain crop in 2022 along with sharply reduced supply out Russia and Belarus — fallout from the former’s invasion of Ukraine — point to increased grain shipments this year.
But container traffic in Canada has continued to drop off as Canadians tighten budgets amid higher interest rates and ongoing inflation.
In March, container volumes across the country fell nearly 12 per cent year over year, according to the National Bank of Canada.
“We still have softer consumer spending. And we’re certainly also hearing about congestion in the supply chain with full warehouses in the main population areas around Toronto and Montreal, stock not clearing through the system as quickly as normal,” Silvester said.
Sluggish movement of the corrugated steel boxes reflects lagging economic output — preliminary figures from Statistics Canada suggest the economy contracted by 0.1 per cent in March.
“Container trade normally tracks pretty closely with GDP. So when we’re seeing GDP down, then we expect to see container trade down,” Silvester said.
Greg Rogge the port authority’s director of land operations, said in a March interview that the port expects container traffic to fall by two to three per cent this year.
Last year, overall cargo volume fell to 141.4 million tonnes from 146.5 million tonnes in 2021.
Fertilizer shipments increased by 13 per cent, while coal and petroleum products rose six per cent each, according to the port. Construction and materials traffic jumped 15 per cent.
