Size of St. Lawrence seaway limits traffic, trade

7/12/2009

During debate 55 years ago about U.S. participation in the St. Lawrence Seaway project, a railroad industry representative testified that as proposed, the system's locks and canals would be inadequate the day they opened.

"The evidence is clear and convincing that a 27-foot canal is already an obsolete and out-moded waterway for ocean-going vessels," Gregory S. Prince, the general solicitor for the Association of American Railroads, testified before Congress as it considered the Wiley-Dondero Act that would commit the United States to building two locks and associated canals and channels in the St. Lawrence River.

From a transportation standpoint, Mr. Prince said, only a canal 35 feet deep would be sensible, but such a canal's construction cost would be so unjustifiably high that Seaway proponents had chosen to "get the camel's nose under the tent" by proposing a smaller facility.

Much to Seaway supporters' chagrin, Mr. Prince was right about Seaway's dimensions, though they blame the railroads and the coastal ports they served for the situation because of those interests' opposition to the project.

The Seaway's 30-foot depth, allowing vessels drawing up to 26 feet, 3 inches to use it, and the 766-foot by 80-foot size of its locks now exclude much of the world's oceangoing fleet. That's particularly true regarding the huge container ships and "RoRo" roll-on, roll-off vessels that dominate the high-value shipping markets for finished consumer goods and vehicles, cargoes that now cross U.S. docks only on the East, West, and Gulf coasts.

But if Mr. Prince's speech against the St. Lawrence Seaway at a 27-foot draft was based on his industry's fear that it would be enlarged soon after construction - to the railroads' detriment - he needn't have worried. Fifty years after its opening, Seaway locks' and channels' basic dimensions haven't changed.

Seaway supporters' original dream was to bring a maritime route into the heartland of America, to connect the factories and mills of the cities ringing the Great Lakes with the world economy. But Big Rail and its union supporters were opposed, lobbying to keep the Seaway as small as possible, if it were to be built at all.

Consequently, Seaway traffic remains predominantly bulk cargoes like grain, iron ore, sugar, and metals, and has stagnated over the past 30 years after growing steadily during the system's first two decades.

And for the foreseeable future, the seven locks along the St. Lawrence River that opened in 1959, five years after the Wiley-Dondero Act's 1954 passage, are likely to stay the way they are, as are the eight locks of the Welland Canal between lakes Ontario and Erie.

A recent study of the Seaway's condition commissioned by the United States and Canadian governments specifically avoided analysis of lock and channel enlargement. Instead, it identified millions of dollars' worth of repair needs just to keep the system reliable into the future.

The U.S. Army Corps of Engineers, which investigated the enlargement issue over the nine years ending last fall, determined that the feasibility of deepening the system and its channels to 35 feet was so unlikely that doing a more detailed assessment wouldn't be worth the $20 million, and five to seven years of additional study time, such an assessment would cost. Officials had ballparked the cost of such a project in 2003 at a minimum

$10 billion, but acknowledged it likely would be higher.

U.S. Rep. Marcy Kaptur (D., Toledo), who over the years has been one of Seaway expansion's staunchest advocates, said last week that her legislative priorities are enlarging one of the St. Mary's River locks at Sault Ste. Marie, Mich., and giving the St. Lawrence Seaway Development Corp. authority to develop "green energy" facilities.

The latter, Miss Kaptur said, could provide the agency in charge of the U.S. Seaway facilities a revenue stream for project development and possible enlargement, along with producing cheap, clean energy for a part of the nation that suffers "job-killing" electricity rates.

Unless a big push develops for a huge, federally funded public-works campaign to further economic-revival efforts, Miss Kaptur said her efforts to promote Seaway trade will focus on maintaining the facilities and supporting development of trade able to take advantage of them, such as "short-sea shipping" using Seaway-sized vessels that would transfer their cargo to and from ocean-going ships at Montreal or along the Canadian coast.

And U.S. Rep. James Oberstar, (D., Minn.), a longtime Seaway champion who during the mid-1990s advocated for creating a single, binational agency to manage the system as a precursor to enlarging it, focused on capital maintenance and modernizing the existing Seaway facilities when addressing a Congressional subcommittee about various budget proposals last month.

"We all know that the Seaway is integral to our economy, and I am happy to be with you again today to see how we have progressed on the rehabilitation of the Seaway's infrastructure," Mr. Oberstar said. "The funding that the Seaway receives will create and preserve jobs and ensure that shipping on the Great Lakes remains reliable."

Canada always has been a bigger backer of the Seaway, and is pledging more money to upgrading the system than its neighbor to the south.

"In recognition of the Seaway's vital role within the economy and to ensure its continued reliability, the St. Lawrence Seaway Management Corporation with the support of Transport Canada will invest $270 million to support asset renewal over the next five years," said Bruce Hodgson, director of market development. "A hydraulic conversion program has been completed in the Welland Canal and the locks will benefit from this technology, which promises to lower long-term maintenance costs."

Collister "Terry" Johnson, administrator of the St. Lawrence Seaway Development Corp., an arm of the U.S. Department of Transportation, said $165 million worth of repair and modernization that the Seaway has proposed for the next 10 years - including $17.5 million to be spent this year - is vital to keeping the system operating.

But as far as capacity goes, he said flatly, "the system is going to stay the same dimensions" as it is now, both because of "intense environmental opposition" and any such project's massive cost.

That's consistent with positions taken by officials from the Port of Toledo and trade organizations representing the U.S. and Canadian fleets on the Great Lakes.

"You could make it [the Seaway] bigger, but what would you do for draft and dredging in the rest of the system?" said Alex Johnson, chief executive officer of Midwest Terminals of Toledo International, the stevedore at the general-cargo dock owned by the Toledo-Lucas County Port Authority. "The cost for deepening and widening would be exorbitant."

"No matter how big you make it, somebody's going to build a bigger ship," said Joe Cappel, senior manager of business development, seaport, for the Toledo-Lucas County Port Authority. While the biggest vessels can't come into the Seaway, he said, there are abundant Seaway-sized ships throughout the world that could come into the system if the cargo lanes developed.

The Corps of Engineers remarked that the biggest uncertainty of enlarging the Great Lakes/Seaway system was not along the St. Lawrence at all, but the unknown cost of blasting deeper channels into the bedrock beneath the Detroit and St. Mary's rivers.

Enlarging those channels and dredging harbors elsewhere throughout the Great Lakes to create the current 27-foot depth cost $257 million during the 1950s, or nearly twice what the United States spent building its two Seaway locks and related facilities.

Glen Nekvasil, spokesman for the Lake Carriers' Association, said by far the most pressing need for U.S. shipping is a second lock on the St. Mary's at Sault Ste. Marie capable of handling 1,000-foot ships that handle the vast majority of iron ore and coal moving between Lake Superior and the lower Great Lakes. Without such a lock, he said, lake shipments are vulnerable should a mechanical failure or other disruption affect the existing Poe Lock.

Building a second 1,000-foot lock is expected to cost about $500 million, of which only $17 million, for construction of a cofferdam to support the project, has been appropriated.

"We have very extensive maintenance needs," said Bruce Bowie, president of the Canadian Shipowners' Association. "Our infrastructure is aging and needs significant maintenance activities to ensure its reliability in the future. But expanding the Seaway would be difficult to justify at this time."

Miss Kaptur said that while she would support any proposal to enlarge the Seaway locks, and would pursue Seaway projects if a large-scale federal public works program were to be developed, "I personally have no preference on enlargement" now.

"I'm advocating for more money for the Soo. It's the only thing on the drawing board right now," Miss Kaptur said.

"Just maintaining the depth is a huge challenge for the Army Corps of Engineers," Mr. Cappel added, referring to a massive backlog of channel dredging throughout the Great Lakes that the Lake Carriers' Association says has forced ships to lighten their loads by thousands of tons on some trips.

The 1,000-foot ships, along with several slightly smaller ships in the U.S. fleet, are too big to go through the St. Lawrence Seaway - but they don't need to. All of their trade routes are confined among lakes Erie, Huron, Michigan, and Superior, serving steel mills and power plants in Michigan, Indiana, Illinois, Ohio, and Pennsylvania.

Indeed, it is rare to see an American ship in the Welland Canal, and even rarer for one to appear in the Montreal-Lake Ontario section of the system, the stretch of river usually identified as the St. Lawrence Seaway.

The Seaway was built only after decades of political wrangling in the United States.

The idea for the Seaway arose during the late 19th century, when it became obvious that the small locks and shallow channels previously built to bypass the St. Lawrence's rapids were inadequate to support modern shipping. It appeared to gain traction with President Herbert Hoover's 1932 signing of the Hoover-Bennett Treaty with Canada's prime minister, Richard Bennett, that pledged binational cooperation on a Seaway project.

But treaty ratification languished in the U.S. Senate after attracting swift opposition from railroads and their labor unions, coastal and Mississippi River system ports, and even Great Lakes shipping interests who feared competition from foreign ships entering the lakes through such a canal. Two Senate ratification votes ultimately failed.

Two factors brought the St. Lawrence Seaway back to life in the United States during the early 1950s. First was the discovery of a massive body of iron ore in Labrador along Canada's eastern Atlantic coast - iron ore that was of potential use to U.S. steel makers in the Great Lakes as well as along the Eastern Seaboard.

The other was a decision by Canadian leaders that, if the United States was not going to cooperate with Seaway construction, they would go it alone, albeit with American participation in development of hydroelectric power plants at the project's dams.

The Canadian initiative galvanized American politicians fearful of losing a control stake in such a canal system if it were built without U.S. participation. Combined with some creative accounting that assigned much of the U.S. projects' costs to the hydropower facilities, with the rest to be recovered through tolls collected from ships, that pressure overwhelmed opponents' resistance.

The provision for tolls, while unique among U.S. inland waterways, overcame critics' insistence that the Seaway not be a financial burden on the American taxpayer.

While the project was built during the second half of the 1950s, however, its channels' and locks' dimensions were based on those of the fourth Welland Canal, built by the Canadians between 1914 and 1932 to replace an earlier, smaller facility bypassing Niagara Falls.

While the Welland's dimensions were by no means small, by the 1950s it was clear to many others within the transportation industry that they were increasingly inadequate for ocean-going vessels. At the same time as it built its parts of the Seaway, Canada blasted a channel 35 feet deep up the St. Lawrence from Quebec City to Montreal to allow bigger ocean-going ships to reach Montreal's port.

For most of the Seaway's first two decades, cargo volume and ship traffic grew, reaching a record 57.4 million metric tons - more than triple the 18.7 million metric tons handled during its first season, 1959.

A bypass around a Welland Canal section that snaked through its namesake city was completed in 1974 and, according to the book Seaway: The Untold Story of North America's Fourth Seacoast, an Army Corps of Engineers study suggested in the mid-1970s that a second canal and locks around Niagara Falls be built on the New York side to alleviate what was expected to be crippling Welland Canal congestion by 1990.

It didn't work out that way. Increasing cargo containerization and the use of ever-larger ships for containers and for vehicles rapidly diverted those cargo sectors out of the Great Lakes system.

The Carter administration's 1980 embargo on grain shipments to the Soviet Union, in response to the USSR's late-1979 invasion of Afghanistan, helped accelerate a shift in U.S. grain traffic from European to Asian destinations that favored West Coast ports, and the Seaway's Mr. Johnson said better agricultural practices in Eastern Europe after the Soviet Union's

1989 dissolution again eroded grain traffic.

Cargo tonnage along the St. Lawrence between Montreal and Lake Ontario has gradually declined over the past 30 years, with occasional surges. It reached 50 million metric tons for the last time in 1981 and 40 million metric tons for the last time in 1988. It has broken 32 million tons only once since 2000: the 35.6 million tons of 2006. Last season, 29.4 million tons of cargo traveled the waterway.

While grain continues to be one of the Seaway's top cargoes, it often is exported in vessels that bring foreign steel or Labrador iron ore into the Great Lakes, and volume thus varies both with harvests and North American demand for steel imports.

Toledo port authority and Seaway officials say the potential for developing new cargo bases in the Seaway system is promising, especially as ports modernize to improve their cargo-handling capability.

Federal "stimulus" grants announced in March included $6.8 million for a high-speed crane and "reach stacker" for Toledo's port, which Midwest Terminals' Mr. Johnson said will provide capability to develop container-handling potential.

The port's existing cranes "work for 1950s and 1960s productivity," while modern equipment is needed to load and unload container ships quickly and efficiently, he said. "We will have, in a very short time, a [business] platform to sell them," the port authority's Mr. Cappel agreed.

They and the Seaway's Mr. Johnson hold particular promise for a new container feeder service starting this year between Montreal and Hamilton, Ont.

"This Hamilton-Montreal service could be just the beginning," Mr. Johnson said. "Toledo is ideally situated to be a container-handling facility down the road, with the rail and highway connections it has, the available space on its waterfront, and the manufacturing base nearby."

But as to why the Seaway operates at only about half its designed capacity, he said, "It's not the size of the ships. It's finding the right mix of inbound and outbound cargo."

Contact David Patch at:

dpatch@theblade.com

or 419-724-6094.