Thank you, Mr. Chair.
Good afternoon to committee members. As was mentioned, my name is Greg Northey. I'm the vice-president of corporate affairs at Pulse Canada.
Pulse Canada is the national association representing growers, traders and processors of Canadian pulses, which include peas, lentils, beans, fava beans and chickpeas. We are proud to be leading the future of healthy, sustainable food through the growth of Canada's pulse industry. We are the world's largest exporter of pulses, shipping to over 130 countries. Our industry's growth is directly related to our ability to meet global customer demand. To do that, we need a reliable, functioning supply chain.
Unfortunately, our sector is currently facing historically poor rail performance. In addition, for the past two years we have experienced considerable disruption to service in the Canadian container shipping market. Roughly 40% of pulses are exported via shipping container, which means the current container disruptions we are seeing are severely impacting our industry's ability to participate in international trade.
I want to be very clear about what these disruptions have meant for pulse growers and exporters. Shipping lines have removed historic routes to the Indian subcontinent, South America and other destinations that our trade has traditionally relied upon. As a result, average transit times for our containers of pulses have gone from between 20 and 40 days to reach destination to now between 70 and 90 days, depending on the destination.
We have experienced record low schedule reliability due to vessel delays and blank sailings. An estimated 90% of pulse exports were either rolled to a later vessel sailing or missed shipment altogether in 2021. Some containers of pulses have sat at port for up to six months before getting on a vessel.
In addition, Canada's export shipping capacity has effectively been cut in half through the decision by container shipping lines to ship empty containers back to Asia instead of shipping containers fully laden with Canadian exports.
As a result, our industry has experienced lost sales and cancelled sales contracts, which has impacted our competitiveness in international trade markets. This has been exacerbated by record high freight rates and additional supply chain costs. For example, the cost to retain a single shipping container for use for export increased from between $1,300 and $1,800 for a container in 2020 to between $4,000 and $5,000 in 2021.
At the same time there have been these excessive freight increases and poor service, it is notable that the profitability of container shipping lines has hit record levels. It is predicted that collective carrier profits for 2021 are in the region of $120 billion to $190 billion. This is a record for them. There is no doubt that a good portion of these profits has been extracted from the pockets of farmers, exporters and Canadian consumers.
This is why Pulse Canada helped found a cross-commodity initiative beyond agriculture, called containercrunch.ca, which is calling on the federal government to act to fix the container crunch and fix the issues facing the containerized supply chain.
We are here today to advocate for two things. The first is that the government immediately open an investigation under section 49 of the Canada Transportation Act to investigate what is contributing to the current container disruptions and to better inform the legislative and regulatory changes required to address the competitive failures in the container shipping industry. We do have a real need to update our legislative system regarding the governance of shipping lines.
The second piece is that we are asking the government to name a supply chain commissioner to lead the recently announced industry-government task force to bring together stakeholders to identify immediate solutions to address supply chain disruptions specific to containerized shipping.
These two actions are critical next steps to help ensure that we identify immediate solutions to the disruptions, but also to help ensure that we are able to move to a new, more desirable state with improved operating levels and financial performance for all who are using the containerized supply chain.
When given a level playing field, Canada's pulse industry can compete in any market around the world. If we are to increase the production and export of sustainably grown, nutritious pulse crops, our industry needs access to a well-functioning, resilient supply chain.
The committee has an important role to play by helping to draw needed attention to this issue, and by providing recommendations that will end the harm this issue is having on Canadian businesses and consumers.
I want to thank you for the opportunity to be here today, and I look forward to answering your questions.