Canada is in a transportation conundrum. The economic rise of Asia has pulled huge volumes of grain, minerals and oil exports westward over the challenging Rocky Mountains and into B.C. ports — taxing existing rail infrastructure and causing ships to line up for days. Blood is boiling as grain farmers, oil and mining companies fight over rail cars, port delays and lost business – forcing the government to continuously send money to shore up infrastructure.
As rail companies like Canadian Pacific Railway have said, we need to relieve some of the pressure and move more products eastwards where the Great Lakes-St. Lawrence shipping navigation system has 50% capacity up for grabs. Manitoba and parts of Saskatchewan already send grain exports eastwards with great success but there is an imaginary line in Saskatchewan where the transportation costs undermine the business case to use this route for key international export markets – and one of the reasons is the cost of pilotage.
For the uninitiated, pilotage is an unknown, unseen quantity. You’ve probably never heard of it. In ports and other specific channels, ships are mandated by law to have a pilot come on board to help with navigation. Most of the 3700-kilometre Great Lakes-St. Lawrence waterway is within a mandatory pilotage zone as are other areas along the east and west coasts.
Unsurprisingly, pilotage costs have a long history of increasing at rates that far exceed the rate of inflation. Just in the past five years, fees, salaries and benefits paid to licensed pilots have increased 3.4 times more than CPI. For example, on the St. Lawrence River, the hourly cost of pilotage exceeds the cost of the entire crew of a vessel, or more than double the cost of a vessel’s captain.
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