CWB said farmers will benefit from contributions that are expected to average at least $10 million per year to the CWB pools when the ships are in operation. They will also benefit from more efficient grain movement through a renewed fleet.
"As ship owners, we are moving forward to strengthen farmers' position in our grain supply chain," said CWB board chair Allen Oberg, a farmer from Forestburg, Alberta, Canada. "This historic step puts us at the helm. Through the CWB, farmers will share in the control and the profits of Great Lakes grain shipping. This is a value-added investment with significant net benefits for Prairie producers."
Oberg said the purchase agreement would not have been possible without the foresight of the government of Canada in removing a 25% tariff on imported vessels last fall, making the renewal of the Canadian domestic fleet and this purchase economically feasible.
Algoma President and Chief Executive Officer (CEO) Greg Wight and Upper Lakes President and CEO Pat Loduca welcomed the partnership with western Canadian producers in purchasing the new, state-of-the-art Equinox class bulk carriers, to be operated and managed by Seaway Marine Transport, which is a partnership of the two companies.
"This exciting initiative will modernize the Great Lakes fleet with larger, faster ships that consume less fuel and meet future environmental standards," Wight said. "By working together with Prairie farmers, we have forged a relationship that will have lasting value for all."
Loduca said the timing is excellent for this partnership, given the need to replace an aging fleet on the Great Lakes. He noted that the current strength of the Canadian dollar also helps keep new-vessel costs down.
"We are very pleased to be seizing this opportunity along with the CWB, which helps ensure the long-term strength of our industry," he said.
The CWB's cost for the two ships is C$65 million, equal to approximately C$1 per tonne, paid over the next four crop years. CWB also own a fleet of 3,400 rail hopper cars that move wheat and barley to ports and domestic customers.