Flooding disrupts Port of Vancouver operations: Update

Adds information on effect on crude, refined products and wheat markets

Flooding in British Columbia, Canada, has caused delays and disruption to road and rail links at the Port of Vancouver.

All rail services in and out of the port were halted on 16 November because of flood damage to infrastructure in the British Columbia interior, the port authority said. Major Canadian rail operators CN and CP Rail have indicated that no rail traffic was available between Kamloops and Vancouver and the firms were conducting damage assessments, after which a timeframe for reopening will be known, it said.

Delays to vessel loadings and increased anchorage demand are expected, the port authority said, adding that road links to the port were also affected by washouts and landslides throughout southwestern British Columbia.

The disruption will affect wood pellet cargoes out of the port, which are thought to be around 100,000 t/month in October-December, a market participant said. This may add pressure to already tight market supplies for spot deliveries.

Deliveries from Vancouver were disrupted by wildfires in the region in July. Canadian wood pellet exports recovered in September but were slightly down on the year in the third quarter.

Disruption to terminal operations caused by the severe weather is expected by the port to lead to vessel delays and increased demand for anchorage in and around it.

Market participants in the Canadian wheat market indicated yesterday that the impact of the heavy rains could cause further delays. This comes in addition to an already tight market outlook for Canadian wheat exports as a result of a smaller crop in 2021, pushing prices to multi-year highs.

The flooding may also disrupt Canadian crude oil and refined products exports from Vancouver, which amount to about 46,000 b/d, according to data from oil analytics firm Vortexa. Fuel marketer Parkland operates a 57,000 b/d refinery in the region.

Most of Canada's coal exports are metallurgical, but some thermal coal exports do leave from Vancouver — although Canada only exported around 5mn t of seaborne thermal coal in 2020, according to data collected by Argus Consulting.

By John Cooper and Saleem Rizvi