Railroad Forums 

  • MMA what if?

  • Discussion of present-day CM&Q operations, as well as discussion of predecessors Montreal, Maine & Atlantic Railway (MMA) and Bangor & Aroostook Railroad (BAR).
Discussion of present-day CM&Q operations, as well as discussion of predecessors Montreal, Maine & Atlantic Railway (MMA) and Bangor & Aroostook Railroad (BAR).

Moderator: MEC407

 #1513161  by roberttosh
 
I have seen the articles, but still don't see SJ being anything more than a niche player. All the money in the world won't change the tidal situation which severely limits when ships can and can't sail into the harbor and even after dredging, the main channel will still only be 10 meters deep at MLT. CN is always going to favor/prioritize Halifax where they can accommodate much larger ships, which is a day closer sail from across the Atlantic than SJ and where CN has considerably more rail/port/support infrastructure. CPRS in turn will always favor Montreal and keep in mind that any moves over the CPRS/CMQ route are going to require a 3-line haul (NBSR, CMQ & CPRS) to get anywhere of any significance, whereas all the other ports offer single line rail service options to the interior - which is another huge disadvantage. This is without even factoring in the large expansion at the port of Quebec City, where CN is teaming up with the operator on a project 4 times the cost/size of the SJ project, and where they can bring in much bigger ships without the tide and channel issues. Keep in mind that with all of its' terminals combined, CN only generates one container train a day to/from Halifax, so where is all of this new business going to come from?
 #1513172  by KSmitty
 
Over the top, as arctic shipping routes open up. The market will exist for Chinese/South-East Asian made goods to land directly on the east coast, and not necessarily just domestic Canadian traffic, but also east coast US traffic.

Is it ever going to be comparable to the BNSF transcon across the southwest? No, but the potential would certainly seem to be there for enough traffic to sustain the Moosehead, and for that matter the Maine Central.
 #1513176  by gpp111
 
Customs will be a problem at the borders, the MM&A trailer train came to an end because of it. Don't expect the Arctic shipping route to open anytime soon, the Northwest Passage didn't open last year, too much ice. The amount of Arctic summer ice has been holding steady the past decade. In any event, there is too much ice most of the year for ship transit (maybe Russian nuclear ice breakers can get through), insurance rates will be huge because of so much unchartered waters lacking navigation aids. A cruise liner ended up on the rocks a few years ago, for example. As for the Port of Saint John, it is better suited for cargo from the south such as the Caribbean, ships from Europe have a more direct route to the St Lawrence ports or Halifax.
 #1513194  by Gilbert B Norman
 
roberttosh wrote: Sat Jul 06, 2019 6:42 pm I have seen the articles, but still don't see SJ being anything more than a niche player. All the money in the world won't change the tidal situation which severely limits when ships can and can't sail into the harbor and even after dredging, the main channel will still only be 10 meters deep at MLT.
Mr. Tosh's points bear considerable worth. The tides are definitely a factor. I've seen first hand the impact of tides in the Bay of Fundy. At low tide, small fishing vessels are simply "beached".

Obviously, the various Irvine family businesses are vested in St. John, and apparently willing to "accomodate" the Port's shortcomings (tide) into their maritime activities.

The "Love Tubs" will dock at and sail from St. John, but I cannot foresee what need they have for railroad transportation.

While I too, from reviewing the August TRAINS article, note the new MMA/CMQ ownership has at least improved the property to the extent some on line community will not get torched, it is doubtful that it it will again handle crude for the Irving interests.
 #1513199  by bostontrainguy
 
KSmitty wrote: Sat Jul 06, 2019 8:54 pm Over the top, as arctic shipping routes open up. The market will exist for Chinese/South-East Asian made goods to land directly on the east coast, and not necessarily just domestic Canadian traffic, but also east coast US traffic.

Is it ever going to be comparable to the BNSF transcon across the southwest? No, but the potential would certainly seem to be there for enough traffic to sustain the Moosehead, and for that matter the Maine Central.
I don't think the arctic shipping routes are the key here. With Trump's tariff threats to China and other considerations, alternative manufacturing sourcing is shifting west to Vietnam, India, Malaysia, Thailand, and Indonesia. That means increased shipping via the Suez Canal and that would bring container ships to East Coast ports instead of the West Coast.

(P.S. Sold my stock in UNP and bought CSX and NSC)
 #1513208  by roberttosh
 
Without some major advantage or selling point, shipping lines are always going to want to offload at or near major population centers like Montreal, LA/Long Beach, NY/NJ, Norfolk/Chesapeake, Savanah and Charleston. Those latter 3 may not themselves be huge population centers, but they are still each in close proximity (within 100-150 miles) to millions of people and at the same time support enormous, growing local economies. Other than Montreal, these locations are all directly along major shipping routes, can take in today's largest vessels and have excellent class one connectivity. As ships get larger, even Montreal faces some uncertainty as to its' future as a direct port of call vs more of a feeder service destination. In reality, Halifax, even with its' deep harbor capable of bringing in the very biggest ships and its' very close proximity to the main shipping routes has had to struggle to stay relevant due it's distance from major population centers and has not seen it's TEU volume change much in the past 30-40 years. If anything, I would say that Quebec City has the potential to take off as it could be the transloading point for Montreal as it will be a much larger facility than SJ, will be able to receive the larger ships, is closer to main population centers and has good connectivity to CN. This is why CN has wisely teamed up with the port's operator while they apparently haven't said a word about Saint John. At the end of the day, Saint John is really stuck between a rock and a hard place, as it's less than ideal location, tidal issues and inability to handle the newer, larger ships, combined with questionable rail options and its' distance from any meaningful population centers make it highly unlikely that it will ever be anything more than a niche player.
 #1513231  by bostontrainguy
 
roberttosh wrote: Sun Jul 07, 2019 9:57 am Without some major advantage or selling point, shipping lines are always going to want to offload at or near major population centers like Montreal, LA/Long Beach, NY/NJ, Norfolk/Chesapeake, Savanah and Charleston.
Well maybe, but thinking that way why would you even need the Union Pacific double-stack network?

Would you dismiss Prince Rupert's success and recent expansion? According to their website: "About 60-70 percent of the imports moving through Prince Rupert are destined for the U.S."

Prince Rupert and Saint John are pretty much mirror images on either side of the continent. Both can tout shorter sea routes to their overseas destinations, easy short non-congested ship access to the terminals, shortest ship dwell times and efficient transcontinental rail-on-dock access.

DP World operates the container terminal in Prince Rupert, British Columbia. They are also the same organization that plans the expansion in Saint John. They are well regarded and know what they are doing.
 #1513238  by roberttosh
 
Comparing SJ to PR is comparing apples to oranges. If anything, Halifax would be a much better comparison. PR is exponentially larger, has much, much deeper water, has much better approaches, has an ideal location in terms of the massive container flow from Asia to the NA West Coast (it's 2-3 days closer sailing time compared to its' biggest competitor, LA/LB) and has the full 110% support of the CN. When you factor in having to go around Nova Scotia, plus the tidal restrictions, SJ is no closer to Europe than Halifax (obviously), NY/NJ and probably even Norfolk. As I've stated several times, if you're not a major population center, then you have to be able to offer the lines some other big advantage, which PR can clearly do. Unfortunately there is nothing overly attractive about SJ that will make it anything more than a niche player. I know I sound like a broken record, but again, its' location off the beaten path, tidal issues, ship size limitations due to terminal infrastructure and channel depth, combined with questionable rail economics and low population density aren't going have many lines knocking at their door.
 #1513240  by Gilbert B Norman
 
bostontrainguy wrote: Sun Jul 07, 2019 8:48 am(P.S. Sold my stock in UNP and bought CSX and NSC)
Mr. Trainguy, let us not lose sight of that the more maritime traffic that gets diverted to any US or Canadian East Coast port, means all the less favorable line hauls for the industry.

Most of the markets for manufactured goods are within 500 miles of an East Coast port - and that works in favor of highway transport straight to destination.

In short, for every line-haul UP and BNSF loses account a vessel docking at an East Coast port rather than a West, that does not mean CSX and NSC will pick up same.

Mr. Cowford, are you out there?

disclaimer: author remains long UNP
 #1513247  by CN9634
 
A lot of factors going into who calls which ports. DP Worlds marriage with the Port of Saint John expansion positions them well to capture some volume for certain. What needs to be understood are the trade lanes— SJ currently has two services from MSC and CMA that are North-South covering the Latin America - Canada trades, for which they are well positioned. Of course for MSC you can transship at Freeport easily to anywhere else in the world.

Regarding vessel sizes and tidal ranges— current ships calling from MSC are 3500-4000 TEUs, a smaller-to-medium sized workhorse. CMA is in the 1400ish TEU range, a doubling of vessel sizes since their first calls with some 798TEU chartered ships in rotation.

Regarding the USA-CAN container issue that doomed the Sunbury train. Timing was a critical element of that, the NAFTA 2.0 and whenever USMCA deal (very similar to existing deal) comes through already solved this problem with the electronic filing with CBP at ingate. Keep in mind CMQ has handled some off shot CP-CMQ-NBSR domestic container trials without transit issues.

Regarding QC— CN making a clear decision on this is interesting, but not surprising after they lost the bid on Halterm. Also, a ‘megaport’ at QC is years off, where although CN has announced it there is never a done deal until shovels meet earth, which is still many years off (think regulatory environment first). Montreal has already started and expansion at , Concetoeur where the port is directly off CN but CP has already been granted access as part of the new deal by way of trackage rights. The problem of Montreal is they are limited to about 5000TEU vessels max. However, Montreal is one of the only ports that completely unloads and reloads the ships, whereas most just work through the vessel rotation a few hundred containers here or there.

Future outlook for Saint John is good. Halifax will continue to dominate the east but there is room for more ports in the Northeast. Boston is a ‘meh’ port that will see sustained growth but very small without any direct rail access. New York is crowded and faces labor issues almost every time a contract negotiation comes up. Montreal will dominate the NA-EU trade but little more beyond that. SJ having DP World at the helm will become the ‘Philadelphia’ of eastern Canada, carving out some key trades into Latin America and perhaps landing a direct connection into Asia. Ideally for them a competitive service into India, Malaysia or Australia would keep them out of the competitive China, Japan, Taiwan trades that Halifax, Boston and NYC will dominate.

Relative to rail, Saint John will boost to be the only Atlantic port that can be reached by both CN and CP. CN has already locked in given the current contractual agreements with CMA and MSC, however CP has been working on peeling away some of that business, so any landing of that, or either a change in Alliance or steamship lines calling Saint John could spark some east-west movement via CMQ. I’d say the important thing to remember is that all the pieces are in place and after the Port expansion that is underway is complete, we'll really see what potential could come up here. That really makes the CMQ line a good prospect for future growth, since they are a profitable enterprise without container traffic, that will be gravy on top of the rest.

Oh and look for Autoracks to return starting Jan 1, as CP won the Glovis contract back and will distribute via NBSR into the eastern Canadian market from Saint John.
 #1513265  by Gilbert B Norman
 
Mr. CN, I like to think I am reasonably informed regarding maritime industry affairs, but some of the shorthand in your informed immediate post has me baffled.

While I'm pretty sure that MSC is a Swiss owned and CMA a Chinese, maritime shipping concerns, Freeport where; Maine, Bahamas?

QC Quebec; City or Province?

Enquiring mind needs help decrypting.
 #1513268  by roberttosh
 
I don't doubt for a second that SJ will indeed increase container counts and become a larger "niche" player, even agreeing that it could potentially become Eastern Canada's version of Philadelphia as you suggested. What I very much do doubt though, is that with all of its' shortcomings, it will ever be able to realistically compete for highly competitive Midwestern US/Canadian bound double stack business against the likes of Halifax, Montreal, NY/NJ, Norfolk, etc. As I mentioned previously, I can picture occasional cuts of containers being tacked onto the rear of CMQ freights, but anyone who thinks this is going to be a game changer in my opinion is going to be disappointed.
 #1513346  by CN9634
 
Gilbert B Norman wrote: Sun Jul 07, 2019 7:27 pm Enquiring mind needs help decrypting.
Freeport Bahamas is a direct call on the CANADA GULF BRIDGE service that calls SJ. Freeport is a well established major transshipment hub for MSC in this part of the world, think hump yard of steamship lines.

CMA-CGM is French, while MSC is “Swiss” by location of HQ only

QC is Quebec City while PQ is Province of Quebec
 #1513359  by Gilbert B Norman
 
Thanks, Mr. CN

"I once was lost, but now I'm found".

Allowing me to continue, I praise the participants at this Forum for their recognition that railroad industry affairs are so linked to those of the maritime.
 #1513362  by CN9634
 
roberttosh wrote: Sun Jul 07, 2019 7:53 pm I don't doubt for a second that SJ will indeed increase container counts and become a larger "niche" player, even agreeing that it could potentially become Eastern Canada's version of Philadelphia as you suggested. What I very much do doubt though, is that with all of its' shortcomings, it will ever be able to realistically compete for highly competitive Midwestern US/Canadian bound double stack business against the likes of Halifax, Montreal, NY/NJ, Norfolk, etc. As I mentioned previously, I can picture occasional cuts of containers being tacked onto the rear of CMQ freights, but anyone who thinks this is going to be a game changer in my opinion is going to be disappointed.
You have to remember, each port while vying for it's own competitive advantage, also offers steamship lines some key elements to their service. Capacity being the major issue, having a few ports in your portfolio keeps any one or two ports from completely melting down. Also, the diversity and mix-mash combination of port operators, stevedores, rail links make it attractive again for steamship lines to build trades to different ports. A strike by one union, of issue with one operator, may impact several ports so having flexibility is critical. Fluidity of the network depends on the rail and port operator's ability to move containers through terminals, and connectivity is key.

Saint John is in a good position because they are looking to hone in on the North-South trade with supporting reefer capability as their springboard back into the broader steamship community. Their spacing from Halifax, Montreal, Boston and New York help fill a bit of a void as those ports fight over the European and Asian trades. What also may happen is one steamship line may plant a flag there and decide to grow along, especially since between those companies they are looking to offer diversity of services. If all steamship lines called the exact same ports, then how would any of the smaller ones compete for marketshare against the larger ones?