Thank you, Madam Chair and committee, for the invitation to attend today's meeting.
I'm Mark Hemmes, president of Quorum Corporation. Quorum has been responsible for monitoring Canada's prairie grain handling and transportation system on behalf of Transport Canada and Agriculture and Agri-Food Canada since June 2001. I've already provided a document to the committee. I don't plan on reading the whole thing, but there are some points that I would like to make.
First, the export of grain in containers has become an integral part of the logistics of the grain industry in Canada. As a proportion of the export movement, it has increased from 1.3 million tonnes in 2000 to over 5.5 million tonnes in 2021. This represents an increase in the total exports of grain, from 4% to over 10% today. That has allowed for an increase in the diversification of crops that producers grow and is a very lucrative business for the country. This came about through an increase in the availability of container capacity in the marketplace. Grain is typically moved in bulk, but the empty containers actually gave an opportunity to expand into niche markets, as Murad was explaining earlier.
In the last three years, from 2018 to 2021, an average of more than six million tonnes of special crops have been exported out of the country using containers. That's an important part of the sector. That sector has grown incredibly in the last 10 to 15 years and is almost wholly dependent on the use of containers to get into the markets its selling to.
What happened in the summer of 2020 with the pandemic hitting was that the container shipping lines significantly reduced the number of sailings, called blank sailings. By doing that, essentially what they left was a whole bunch of loaded containers on the docks in Vancouver and Prince Rupert, and to an extent in Montreal. As such, shippers had to pay an incredible amount of storage fees and demurrage, and the out-of-contract penalties that were associated with them. With the reduction of those incoming vessels, the empty container capacity and the vessel capacity for loaded movement were both significantly strained.
Container shipping lines then began to reduce requests for empty containers in North America for loading those export goods, ordering the railways and the container terminals to remove all the empty containers back to the origin countries, mostly in the Asia-Pacific area. The Port of Vancouver's average monthly total of loaded export containers dropped by 33% compared with the average in the same 12 months in 2019 and 2020, while the number of empties moved out increased by 96%.
This change had a significant impact on the export of grain in containers and the business volumes of the five transload operations in the Port of Vancouver. The total volume of grain in containers was reduced by half from April 2021 to May 2022. Some of that reduction was because of the reduced crop size, but most of it was because there were no containers available to move it.
The consequence of these issues compounds and reveals itself in the actions taken by the container shipping lines to expedite empty containers back to the line haul origins, as well as in the increased price they charged for the movement of containers through that period. As was just pointed out, while those container prices have dropped, it's not terribly significant when it comes to this movement.
Canada has little in the way of real-time or historical data on this. This makes it very difficult to analyze and assess the movement of containers, except through the data supplied by port authorities on a voluntary basis. In the grain industry, both the Canada Transportation Act and the Canada Grain Act offer legislative and regulatory solutions for the collection, analysis and assessment of data on the bulk movement of grain. However, there is little in the container movement.
This applies to all other commodities as well, other than grain. To provide a detailed assessment of the impact these shortfalls have on capacity, data at a level that is equivalent to what is provided for the bulk movement of grain is absolutely essential.
In closing, I would point out that Canada grows some of the best and most desired grain in the world, but must contend with barriers and risks no other competitor nation must. We have a longer length of haul to port, extreme geographic impediments in the form of the mountain range, climatic conditions that can vary from -40°C to 40°C through the year and ocean distances that are some of the longest to our buyers. As such, just staying even with our competitors on a global basis is dependent on us having the world's most efficient transportation and logistical system in the delivery of our products.
The fact that we've not been as efficient as we need to be and have experienced a continued number of supply chain breakdowns has damaged our reputation as a reliable supplier. Canada's position in the global grain marketplace depends on us getting a lot better.
Thanks for the opportunity. I look forward to any questions you may have.