Transport Committee on April 4th, 2022

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Gooch.

Thank you, Mr. Iacono.

Mr. Barsalou‑Duval, you have two and a half minutes.

[Xavier Barsalou-Duval, Bloc, Pierre-Boucher—Les Patriotes—Verchères, QC]

Thank you, Chair.

Since the beginning of the pandemic, we have seen several airlines pivot toward cargo operations in order to generate extra income. In the meantime we get the impression that there has been growth in air-shipping.

Is that really the case? Is this change sustainable in the long term? If so, what impact will this change have on infrastructure needs at the airports?

My question is for the representative of the Canadian Airport Council.

[Monette Pasher]

Thank you, Mr. Chair.

Our airports and airline carriers certainly saw a move to freight throughout the pandemic. Our passenger traffic went down 90%. Part of the reason we stayed open was to connect people for essential movement and to move essential goods. We have seen many of our carriers convert their aircraft to freighter, but I think we're going to see more freight traffic moving forward.

Prepandemic, 60% of our goods for air cargo were moved in the belly of the plane, and about 40% were moved by freighter traffic. Throughout COVID, we have seen about 55% freighter traffic. That's a global statistic, so we expect to see more of this moving forward, but also, as we move to building back our air capacity—and we're going to see some improvements in that this summer—hopefully we'll see a lot of our goods moved in the belly of planes again.

I think we will see a shift, but it won't be permanent.

[Xavier Barsalou-Duval, Bloc, Pierre-Boucher—Les Patriotes—Verchères, QC]

I now have a question for the representatives of the Chemistry Industry Association of Canada.

A lot has been said about the supply problems and lack of products everywhere. Many people have suggested that it might be a good idea to shorten our supply chains, for example by turning to local production.

In the case of the Canadian chemistry industry, could this make sense or be acceptable? Are there opportunities to seize here?

[The Chair, Liberal, Peter Schiefke]

Unfortunately, Mr. Barsalou‑Duval, your time is up.

Mr. Bachrach, you now have the floor.

You have two and a half minutes.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Thank you very much, Mr. Chair.

I would like to direct my next questions to Mr. Given. You spoke a bit at the beginning about the impact on workers in your sector that occurred at the beginning of the pandemic, mostly, in terms of workers being stuck on ships.

Could you expand on that and speak a bit to what role the federal government could have played to alleviate some of those conditions that your workers faced?

[Chris Given]

I guess I need to differentiate between the domestic workforce and the international workforce, because the worst conditions were endured by international seafarers engaged in global shipping.

I'm an elected representative with the International Transport Workers' Federation based in London, which has an inspectorate around the world that inspects foreign-flag ships when they come into various ports. There are three of those inspectors in Canada.

What occurred when the pandemic came about was.... The maximum allowable under the ILO Maritime Labour Convention for a term on board a ship is 11 months. Because of the pandemic and the various lockdowns that occurred at the beginning, there was an extension of contracts that was agreeable and understandable for a short term, but those extensions ended up going to 17, 18, and up to 20 months, where seafarers were not allowed to get off ships to be repatriated. Not only were they not allowed to be repatriated, but the majority of flag states—countries and ports—refused to allow foreign seafarers to engage in shore leaves and get off their vessels. Many weren't able to access medical services in countries because of lockdowns, so the conditions were really hard.

Here in Canada, our domestic workforce endured a lot of the same, but on a smaller scale. Contracts had to be extended. Terms on board vessels had to be extended and, again, shore leave was denied for many of them.

I have to give credit to Transport Canada and port state control, because they did an effective job at eventually helping those seafarers, especially the foreign seafarers visiting Canadian ports. However, it took too long to get to that stage, so by the time port state control officers were enforcing that maximum period, a lot of these seafarers had been on board for 17 or 18 months. They were forced to sign contract extensions, because they had worked as exploited workers in a lot of these circumstances.

It has been a very difficult condition for workers.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Thank you, Mr. Given.

Mr. Chair, do I have a few more seconds for another question?

[The Chair, Liberal, Peter Schiefke]

You have 35 seconds.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Okay, fabulous.

Mr. Given, I was interested in what you said about domestic shipping. My assumption is that right now the different shipping modes exist in a competitive environment and shippers are able to choose the mode that gets the goods to market in the best way possible.

You mentioned the low-carbon nature of domestic shipping. I'm wondering what specific investments the government could make to drive that transition toward domestic shipping and that lower-carbon mode of transport.

[Chris Given]

Thank you for the question. I'll try to be very quick.

I know that a lot of investment, and talk about investment, is happening with regard to low-flashpoint fuel, which is using ammonia, LNG and hydrogen as alternative fuel sources because they are lower-emissions fuels. Further investment in that, further study and research, and allowing ships to trial some of these different fuels would be very helpful. It's not just trying the fuels, but ensuring we have the training for our workforce to be able to handle those fuels safely.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Given.

Thank you, Mr. Bachrach.

Next, we have Mr. Muys.

You have five minutes. The floor is yours.

[Dan Muys, Conservative, Flamborough—Glanbrook, ON]

Thank you, Mr. Chair.

Thank you to all the witnesses for taking the time today.

We've had a fairly robust discussion on ports. I might come back to that, but I want to turn the attention to the Canadian Airports Council and Ms. Pasher.

In my constituency of Flamborough—Glanbrook, Hamilton International Airport is one of the crown jewels in our economic crown for the region. As I think you know, it is the largest overnight express cargo airport in the country and it's growing. For example, DHL opened a facility a year ago at the Hamilton airport. They had a 15-year plan to expand and evolve into somewhat of a North American hub. They're already at that point a year later. Amazon just opened a facility adjacent to the airport at the end of January. It is one of only two Amazon facilities of that level in the country.

Could you elaborate on what more Transport Canada and the Government of Canada can do to encourage these important cargo hubs as part of our supply chain resiliency?

[The Chair, Liberal, Peter Schiefke]

Mr. Muys, I think we might be having a technical difficulty here.

Mr. Clerk, do we still have the witness?

[The Clerk]

It appears she's frozen. We'll have IT—

[The Chair, Liberal, Peter Schiefke]

Mr. Muys, I'm going to give you back the time you've lost.

For the time being, I encourage you to try to ask a question of another witness.

[Dan Muys, Conservative, Flamborough—Glanbrook, ON]

Okay, that's fair enough.

I'll back up to the question that Mr. Bachrach just asked of the seafarers' union, which was about his perspective with regard to the environmental benefits of marine transport. Maybe you, and the ports council of Canada as well, can talk more about domestic shipping. That's an opportunity. The Hamilton port is in proximity to my riding. With the steel industry and the agricultural commodities that are shipped, I think there's great opportunity. Mr. Badawey has asked about the national trade corridors fund and there's been a discussion around that.

What more can be done to really encourage short-seas shipping and domestic shipping via these assets we have in our area?

[Chris Given]

Thank you, Chair, and thank you to the member for the question.

I'm a workers' representative, but I think I can speak a little on behalf the Canadian shipping companies. I'm sure they would allow me to do so. From our perspective, all of the Canadian shipping companies are very interested in taking up this work. It's work that has not really been tapped into at this point. I'm speaking specifically to containerized shipping. The majority of Canadian shipping is on bulk and breakbulk cargo, which moves a lot of natural resources and petroleum products. Moving consumer goods or containerized goods is an untapped area, and I think there's a lot of potential there.

It's not at all to take away work from the rail or the trucking lines, but to diversify the ability to move goods out of ports. We're hearing a lot about congestion in ports, so it would be useful to look at alternative ways to move some of those goods. There is a lot of opportunity and underdeveloped land along the seaway.

It's not just in Hamilton-Oshawa, as we discussed before, but all along the seaway. There has been a lot of discussion about how to tap into the U.S. Midwest market with Chicago and Cleveland, and to access even the GTA. About 500,000 containers are moved into the GTA every year, but that's done on truck and rail. If we can diversify that a little bit and move more of it via the marine mode, I think that would be beneficial for everybody.

[The Chair, Liberal, Peter Schiefke]

Mr. Muys, I can confirm that we have Interim President Pasher back, if you want to re-ask your questions.

[Dan Muys, Conservative, Flamborough—Glanbrook, ON]

Thank you. Hopefully the technical difficulties have been figured out.

Hamilton International Airport is located in my constituency. As I think you know, Ms. Pasher, it's the largest overnight express cargo airport in the country. It's certainly growing rapidly. We had DHL locate there about a year ago. They had a 15-year plan to evolve into a North American hub, and they already achieved that one year later. Amazon, as I think you know, just opened a facility at the end of January adjacent to the Hamilton airport, and it's one of only two Amazon facilities of that level in the country.

Maybe you can elaborate on what more Transport Canada can do and what more the Government of Canada can do to seize upon these important cargo hubs as part of our supply chain resiliency.

[Monette Pasher]

Yes, Hamilton has seen tremendous growth. It is primarily a freighter airport, and it has had a lot of growth throughout the pandemic. Really, the national trade corridors fund has been helpful in expanding the infrastructure.

I think that what we've seen throughout the pandemic is that, because they've expanded that infrastructure, they were able to grow. We've seen that at other airports throughout the country, such as in Halifax and Edmonton, with projects that were approved years ago and have been under way. Now they have that expanded apron space, and they were able to receive some of these shipments by air cargo to keep our supply chain moving. Air is playing an increasingly important role in getting exports to market and in getting goods into Canada.

What we need to do is keep investing in the national trade corridors fund. Our airports have only seen about 18 projects approved since it was announced in 2017, with just over $220 million. Much of that was for small airports to pave their runways and things like that. I think we should focus on cargo needs to improve our supply chain for Canada moving forward. Some of our airports have asked for a dedicated air cargo line item in the national trade corridors fund of about $100 million a year to really move forward and to invest in the future so that our airports are able to play the important role they've been playing throughout the pandemic.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Ms. Pasher.

Thank you very much, Mr. Muys.

Next we have Mr. Rogers.

Mr. Rogers, the floor is yours for five minutes.

[Churence Rogers, Liberal, Bonavista—Burin—Trinity, NL]

Thank you, Mr. Chair.

First of all, thanks to all of our guests for their testimony today. Their knowledge and expertise in their fields are good to hear on this very important and interesting topic.

Mr. Masterson, I have a question for you, one that Mr. Gooch might want to chime in on as well. What role could better data collection and data sharing play in improving our supply chains? Can you give us some examples to illustrate that?

[Bob Masterson]

Thank you, Mr. Rogers, for your question.

I'm going to defer to my colleague, Kara Edwards, who can talk especially about the importance of data and information to level the playing field between shippers and rail companies.

Thank you, Kara.

[Kara Edwards, Director, Transportation, Chemistry Industry Association of Canada]

It's great to see everybody at committee. Thank you so much.

A lot of information in the system right now is not as transparent as it could be. We'd really like to see the publication of the amendments to the transportation information regulations. In our sector, that would really assist in helping to identify where some of the bottlenecks are. It would really even the playing field and make sure that everybody sees the same thing and uses the same metrics.

With better information, you can make better choices, you can do better benchmarking, and you can have consistent tracking. In our case, we see that there's a really imbalanced relationship between shippers and carriers, so, in addition to making more data available and transparent, we'd also like to see the authority of the Canadian Transportation Agency and the remedies they have improved upon as well.

Regarding the transportation information regulations, we're really interested in seeing the amendments, which we believe will have better geographic and commodity-specific information in them.

Thank you.