A combination of a large number of imports plus an inadequate number of railcars to move those goods is causing backlogs and congestion at West Coast ports in Canada – particularly at Vancouver, a major arrival point for promotional products from overseas.

Port of Vancouver delays on Biteable.

RailState, a freight data platform, reports that in March, intermodal volume at the Port of Vancouver – those imports that require more than one form of transportation during a single journey – reached its highest level since August 2022. Factors include an increased movement of goods post-COVID, as well as a number of shipping chokepoints around the world, such as Houthi attacks in the Red Sea and drought conditions in the Panama Canal, which have resulted in reroutings.

The port saw a 10% increase in volume from February, a nearly 40% increase over the average monthly volume throughout 2023, and a 51.7% increase year over year. Intermodal volume at Vancouver rose steadily throughout last year, with brief interruptions caused by a dockworkers’ strike last summer and a cold snap earlier this year.

But the number of available railcars hasn’t kept pace with the number of containers arriving, resulting in longer dwell times and congestion at all marine terminals in Vancouver. Dockworkers have had to increase the number of containers loaded on each train, with the average rising from about 290 in January, to 320 in February, to 340 in March. On average, each train is carrying 76 more containers than the 2023 average and 120 more than March 2023. Currently, the Vancouver Fraser Port Authority reports that delays stand at about five to seven days.

“We haven’t seen container volumes like this in more than a year and a half,” said RailState co-founder and Chief Commercial Officer John Schmitter in a report released April 3. “These trains are pretty much maxed out and moving more containers will likely require more trains.”

While additional rail cars have started to arrive to help relieve the congestion, the clearing out will take time. Canada’s two largest railways that also service the Port of Vancouver – the Canadian National Railway (CN) and Canadian Pacific Kansas City (CPKC) – are also now in the conciliation process ahead of a possible work stoppage in May. Teamsters Canada, which represents nearly 9,300 engineers and conductors at the two companies, has warned of a strike over working conditions and wage increases.

In February, CN and CPKC filed notices of dispute with the Canadian federal labour minister and requested a conciliator to oversee the bargaining process.

“We haven’t seen train volumes change too much and it’s tough to imagine big crew changes while the railroads are currently in conciliation,” said Schmitter.

51.7%
the percentage increase in container volume arriving at the Port of Vancouver between March 2023 and March 2024 (RailState)

So far, promotional products companies in Canada said they’ve experienced little in the way of interruption of shipments, but they continue to monitor the fluid situation. The rail lines servicing the ports are typically bound for provinces beyond British Columbia, which has so far shielded nearby distributors from service shocks.

“My team isn’t feeling any impact,” says Laura Hansen, president of Vancouver-based Image Group Inc. (asi/230059). “Central and Eastern Canada may be feeling the effects of this more so than the West Coast.” Similarly, Tonja Zander, bilingual account manager at TPS Promotions & Incentives (asi/341409) in Markham, ON, says her team gives themselves an extra week for arrival time, which has so far mitigated the effects of several-week delays in Vancouver.

Meanwhile, Warren Gencher, president of Brymark (asi/149287) in Ottawa, says they’ve waited an extra two to three weeks for some products. “It’s random,” he says. “One time it was 4,000 baseball caps, another time it was 50,000 plastic Easter eggs. I do think it’s a temporary situation.”

While the situation is “concerning,” says Sergio Munoz, vice president of sales & marketing at Add Impact (asi/106606) in Woodbridge, ON, so far suppliers have managed conditions well.

“We’ve been keeping a close eye on it,” says Munoz. “Suppliers’ inventory management has been efficient, and they’re keeping their shelves well-stocked to minimize disruption. We’re also actively working with our clients and overseas partners to ensure smooth operations for our overseas production. Fortunately, having on-the-ground support in China provides us with additional resources and flexibility to manage potential delays.”

Still, industry companies would do well to keep tabs on lengthening dwell times at West Coast ports and a possible railway strike that could happen in May. Last summer, a two-week dockworkers strike stranded 63,000 shipping containers off British Columbia carrying billions of dollars’ worth of goods and took nearly 60 days to clear.