Ready, set, go!
March 01, 1996
by Teresa Acklin
Ports around the world prepare for increased grain shipments amid expectations for trade growth.
By Melissa Cordonier, Editor
After spending much of the past two decades in the doldrums, the global grain market has been reinvigorated of late. Grain supplies have tightened, demand has climbed, markets have been privatized, and trade rules have been liberalized. In the wake of these developments, many analysts and observers predict world grain trade in the next few years will increase notably.
In this optimistic environment, many ports and port grain terminals are improving their handling abilities through modernization or expansion. The nature of the improvements ranges from equipment upgrades to new facilities, depending on how each port or export terminal views its role, both now and in the future.
If a consensus exists, it is that the economics of trade means grain shipments are likely to get larger. Evidence of this trend can be found in the growing number of large ships, 60,000-dwt Panamax-sized or larger, that gradually are replacing the aging 25,000-dwt Handy-sized fleet; in the ports that have deepened channels or increased air draft to accommodate larger vessels; and in the efforts by terminals to increase loading or unloading capacities.
Receiving ports in markets expected to see great growth in grain trade particularly the importing countries of Asia are taking dramatic steps to overhaul their infrastructures. In some cases, ports need to modernize and upgrade existing bulk facilities, while in others, completely new infrastructures are under construction. Some ports are working to augment bagged or manual systems with faster or more efficient mechanisms and equipment.
In China, Malaysia, Indonesia and the Philippines, port projects have been completed or are under way to expand capacity and assure cheaper and more efficient grain handling. In other parts of the world, port privatization and/or market liberalizations are stimulating investment in port improvements, with projects under way in Egypt, Saudi Arabia, Mexico and South America.
Large projects are in the works even at “mature” ports where relative efficiencies already existed. Improvements include upgrades to faster handling systems, more efficient sanitation equipment and more automation, particularly in weighing and inventory control. Ports in Japan and Taiwan are among those that have expanded capacity in the past few years.
MOVING TO THE PACIFIC RIM. Another of these “mature” ports is the Port of Vancouver, Canada, which recently selected Cargill Ltd. and Saskatchewan Wheat Pool to jointly develop a new high-throughput grain and agricultural products export facility (see January/February 1996 World Grain, page 65). Vancouver, on Canada's west coast in the province of British Columbia, has been the country's largest grain exporting port for the past few years, shipping out slightly more than 14 million tonnes in 1994.
The new terminal, expected to cost about U.S.$116 million, will handle 3 million tonnes of grain a year for the first four years, expanding to up to 5 million tonnes annually thereafter, according to Barb Isman with Cargill Ltd.
The proposed project currently is in the engineering stage. The actual start of construction is contingent on successful completion of several steps, including lease negotiations with port officials and receipt of environmental and other public permits.
Ms. Isman said the necessary approvals to begin construction could be in place as early as September, with the facility operational by April 1999.
“Of course, in this day and age, the environmental issues and permitting process ... are major steps,” she said. Nonetheless, she said that the participants were optimistic the proposal would be approved.
“The fundamentals are solid,” she said. “This project reflects the way we feel about the future of the market, about the movement of the market to the Pacific Rim.”
Up the British Columbia coastline is the Prince Rupert Port Corp., home to Prince Rupert Grain Ltd. and Continental Grain Ltd.'s Fairview Terminal. A record 5.5 million tonnes were exported through the port in 1994.
For the past several years, Prince Rupert has worked with Continental to develop a specialty crop facility. In 1994, hay cubes were introduced as a new commodity exportable through the specialty terminal, making another product easily available to Asia's booming feed industry.
In a different part of the world, another company eager to take advantage of the jump in Pacific Rim import needs is Co-operative Bulk Handling Ltd., West Perth, Australia. At its terminal at Geraldton, a major upgrade and expansion program was completed in late 1994. The terminal was the last of C.B.H.'s four port terminals to undergo major renovation.
The Geraldton project included 140,000 tonnes of new grain storage, along with a new system to elevate the grain. Other new facilities included two discharge pits, a track shed, an automatic sampling system and a comprehensive dust collection system.
Project construction consisted of 14 steel silos, each with a 10,000-tonne capacity, and a 61-meter high headhouse. The new headhouse was built with precast hollow core concrete planks for flooring; the use of precast planks eliminated the need for the concrete to cure, which saved time and allowed instant access for other construction work.
Instead of traditional elevators, C.B.H. installed an inclined conveyor system. The main conveyor gallery is 200 meters long, with a 13-degree incline; it houses four conveyors, each with a capacity of 1,000 tonnes per hour. The conveyor system was manufactured at Kwinana and was shipped the 400 kilometers to Geraldton by road in 32 sections.
With the project's completion, Geraldton, which receives grain from Western Australia producers, now has five truck pits and one rail pit with a combined unloading capacity of 4,000 tph. Some of the storage bins are sealed for fumigation to allow long-term storage without insect problems.
The terminal is completely automated, with receiving, storing and outloading processes computerized and operated from a central control room. The system selects grain and flow paths, monitors conveyor rates and manages inventory information.
Grain for export shipment, outloaded through the new headhouse, is fed into garner bins via automatic batch weighers. A series of conveyor belts passes the grain through the transfer and shipping galleries to gantries, where grain is loaded onto the ship through a telescopic slewing spout.
Geraldton's maximum ship loading rate is 1,000 tph, but C.B.H. officials plan to upgrade the system to 2,000 tph this year.
On the other side of the country, Grainco Ltd., which has four port facilities on the Queensland coast in northeast Australia, in late 1994 completed a new U.S.$5.5 million wharf at its Pinkenba terminal at Brisbane. The new 256-meter steel and concrete structure, which replaced a 50-year old timber wharf, allows for larger vessels of up to 50,000 dwt at a low water berth depth of 10.5 meters.
But Grainco is cautious about predicting sustained growth in its grain export prospects. Campbell Newman, Grainco's ports development manager, acknowledged the recent end to Queensland's nearly five-year drought could produce a surge in grain exports this season.
But given the possibility of future crop-slashing dry spells, Grainco has adopted a strategy to “drought proof” the business through product diversification, Mr. Newman said. The company is actively working to store and handle other dry non-hazardous bulk commodities, such as silica sand, soft woodchips and magnesia, and is considering container packing and bulk liquid storage and distribution.
Mr. Newman also said grain shipments through the Queensland ports depended on grain price trends. Relatively low prices in recent years have eroded the volume of shipments, notwithstanding the drought, as cheap grain moved to domestic feedlots and growers switched to other crops, he said.
BETTER EXPORTING THROUGH BAGGING. At the Port of Galveston, Texas, U.S., officials are more optimistic about their long-term export prospects, particularly after 1995 grain shipments through the port's two terminal facilities reached a seven-year high.
In the past two years, the Public Export Elevator, owned and operated by the port, has undergone several improvement projects. In one, the port increased the air draft by about 3 meters by raising loading spouts; the purpose was to accommodate larger vessels. Deepening of the Houston-Galveston Navigation Channel is planned for 1997.
Last year, the port upgraded its grain and rice cleaning facilities by installing heavy-duty cleaner/aspirator equipment. The cleaning system was installed to complement another new component of the port's grain handling operations, the A.B.T. bagging facilities.
The automated bagging and bag handling terminal currently is in the start-up phase. Developed by A.B.T. Management, a private Galveston company, the U.S.$33 million project integrates truck, rail and barge grain receipts; dockside grain terminal storage; bagging; warehousing; and ship loading in a fully automated system.
The automated bagging system was built at a waterfront site between the Public Export Elevator and new warehouse space. The warehouse will tie together the existing 142,000 tonne grain elevator, the existing 36,000-square-meter storage warehouse and the new system's high speed ship loaders.
Construction included new buildings for equipment and additional warehouse space. Some 6,750 square meters will be devoted to warehouse storage, with the remainder used for automated conveyor systems. These systems will offer automated rail car unloading for pre-bagged items such as flour and rice, as well as a bulk transfer area for automated bagging of bulk grain.
A new conveyor will transport bulk grain from the grain elevator to the A.B.T. terminal, where the grain will flow into one of four receiving bins. Automatic systems will bag the grain in 50-kg units, which will be moved by conveyor to a dockside vessel or to warehouse space.
Pre-bagged items are received by rail car unloaders for warehousing or direct ship loading. Dockside unitizers will provide conveyor access for bagged products from warehouse to ship. Steel cranes, 45 meters high by 15 meters wide, will run on rails along a 121-meter concrete dock for ship loading. At the vessel, products will move down a spiral stainless steel slide into the ship's hold for export.
Galveston port officials said the addition of the bagging system would enable the port to service countries relying on bagged imports as well as bulk customers.
CAP CURBS GROWTH. In Europe, some port officials and grain traders are less optimistic about increased activity, at least for the next few years, primarily because of the drawdown in E.U. export supplies relating to reforms of the Common Agricultural Policy.
The Port of Rouen, France, for instance, has seen annual grain volumes slide sharply in the past two years, to fewer than 7 million tonnes from a consistent level of more than 8 million tonnes before CAP reforms. Port officials said they expected to handle fewer than 7 million tonnes through 1997; grain handling could return to the 8-million-tonne level by 2000.
At the Port of Tilbury, London, imported grain tonnages have remained fairly stable at 500,000 tonnes plus in recent years, according to officials. But exports, which are handled at Tilbury by Thames-grain Elevators, tend to be more volatile.
An export trader for Mardorf Peach, which owns Thamesgrain and is part of the Allied Grain Group, agreed with projections that global demand for grains should increase over the next few years. But he pointed out that E.U. exports to third country destinations depend on decisions made under the CAP. Because continued set-aside arrangements will adversely affect exportable surpluses, the trader expressed uncertainty about how much of any jump in global grain trade might benefit European ports in general or Tilbury and Thamesgrain in particular.
So far in the current marketing season, very little grain has been shipped from the U.K. to receivers outside the E.U., continuing a recent trend, the trader said. Although separate figures for U.K. exports were not available, E.U. grain shipments to third countries from January through July 1995 were only 10.9 million tonnes, according to the International Grains Council. That figure compared with 15.7 million tonnes in the same period in 1994 and 16.8 million in 1993.
But even though future growth in grain shipments is perhaps less certain at Tilbury than in other areas of the world, port and terminal officials have invested in improvements.
Diver Shoal, a part of the Thames where the river widens, was sometimes a problem for fully laden vessels when entering or leaving Tilbury. Consequently, depth has been increased to about nine meters from 7.6 meters by a combination of dredging and the construction of six jetties on the north shore. This work, carried out by the Port of London Authority in 1995, enables a constant flow to be maintained and assists the passage of larger ships.
At the terminal itself, an ongoing major project is under way to upgrade the dust control plant, according to Michael Cooper, grain manager for the Tilbury grain division. Work completed in 1995 was the basis of the winning entry for the annual Ron Payne Safety Trophy competition. This nationwide event is open to the more than 100 members of the Port Safety Organization. The trophy was presented to Tilbury in February.