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This article was published 17/11/2021 (192 days ago), so information in it may no longer be current.
OTTAWA — Catastrophic flooding in B.C. has severed crucial road and rail routes, meaning Prairie farmers are likely to be hurt by delays in getting their grain to market.
"The impact for us is outbound grain — and this is a peak shipping season," said Barry Prentice, a University of Manitoba professor in supply chain management.
"It's our biggest export corridor, so anything that happens there does have an impact along the line."
"This could well extend into the new year."
This week’s flooding and landslides have washed away the main routes used by CP Rail and CN Rail to connect the Port of Vancouver to the rest of Canada, as well as major highways used to transport goods. B.C. has declared a provincewide state of emergency.
Manitobans could pay more for consumer goods, Prentice said.
"We may not feel the sharp point (of it) but this thing has a macro effect, affecting the whole country," he said.
Prentice said Manitoba supermarkets are mostly supplied by trucks, which ship produce from California and northern Mexico. The B.C. weather events likely won’t reduce the amount of food that reaches the province, but "these sort of transportation issues do have a tendency to raise rates."
He added that goods arriving from Asia could be delayed, on top of current backlogs. COVID-19 has shut down Chinese factories and sparked consumer demand that has resulted in a lack of available shipping containers.
Manitoba’s largest farm group said it was monitoring the potential effect on both the grain and livestock sectors, which have suffered due to summer drought.
"There are supply-chain concerns here across the board for farmers," said Keystone Agricultural Producers spokesman Graham Schellenberg.
"Presumably, if the Port of Vancouver is unable to operate, that could create additional stresses on other ports in Canada… and additional pressures compounding on the supply chain."
The Western Grain Elevator Association said a backlog can create a snowball effect, where shipping costs rise based on how long demand is pent up.
"It has a cascading effect further on into the supply chain," said industry spokesman Wade Sobkowich.
"It’s a continuum, and it's exponential, so it's really hard to quantify it."
The railways are analyzing the damage and have provided no estimate for how long repairs will take, though some external analysts have suggested repairs might take upwards of two weeks.
The Port of Vancouver usually ships more grain than the other three major ports combined: Thunder Bay, Ont., Prince Rupert, B.C., and Churchill, in northern Manitoba.
Sobkowich said customers order grain six to nine months in advance, and that makes it tricky to change shipments to another port when a flour mill in China has already paid for a shipment of grain.
Prentice said Canadian supply chains should brace for even more disruptive weather events made worse by climate change, while governments try to reverse global warming.
"This is the kind of thing that's coming down (the pipe) and I don't know what you can do to personally protect yourself," he said.
Sobkowich said in the long term, grain companies might opt to ship a larger share of grain to Europe and the U.S., to account for the added risk of disruptive wildfires and floods in B.C.