Near-shoring on agenda at conference

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Global supply chain vulnerabilities that have been exposed by the pandemic have revived discussions in North America and elsewhere about the reasonableness of tightening up supply routes.

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Hey there, time traveller!
This article was published 15/12/2021 (356 days ago), so information in it may no longer be current.

Global supply chain vulnerabilities that have been exposed by the pandemic have revived discussions in North America and elsewhere about the reasonableness of tightening up supply routes.

The idea of near-shoring was on the agenda during Tuesday’s 26th Fields on Wheels Conference organized by the University of Manitoba’s Barry Prentice.

Prentice, who is a professor of supply chain management and a professional associate of the Transport Institute of the I.H. Asper School of Business, has been bringing together agri-business and logistics experts from around the world to the conference to conduct deep dives into the trickiest logistics issues.

Diane Gray, the CEO of CentrePort. (Mikaela MacKenzie / Winnipeg Free Press files)

Jon Harman, managing director of marketing, grain and fertilizer with Canadian Pacific Railway, spoke about potential logistics efficiencies that could be created with CP’s acquisition of Kansas City Southern that just received approval from shareholders of both companies.

The US$31-billion deal will create the only single-line railroad linking the United States, Mexico and Canada.

That new Canada-U.S.-Mexican rail integration could be an important feature for an ambitious US$3.3 billion Mexican port expansion and rail enhancement project called T-Mec, that has targeted Winnipeg as its northern terminus.

Kevin Kuly, the Canadian managing partner for one of the project’s backers, Caxxor, also presented at the Fields on Wheels conference.

Among other things, he said, “We aim to eliminate inefficiencies in the North American trade infrastructure.”

The project includes a massive expansion to the Mexican Pacific port of Mazatlan and significant enhancements to rail service between Sinaloa coastline and North American transport networks.

Although Kuly was short on specifics about the pace of development — including the creation of its Canadian master plan — he did indicate it would be many years for the entire project to be completed.

Kuly’s presentation did not go into great detail as to why Winnipeg was identified for its northern terminus other than to cite its obvious central location and the presence of CentrePort, the tri-modal inland port with foreign trade zone benefits.

Diane Gray, the CEO of CentrePort, who also presented at the conference, confirmed Caxxor was inquiring about land acquisitions in Winnipeg.

“Once their Canadian plan is complete they will have a better idea of what their needs in this market are,” she said.

While not a lot is known in Canada about Caxxor, Gray said the principals are credible infrastructure bankers.

Gray and CentrePort have long been interested in identifying new opportunities for linkages between Winnipeg and Mexico and this is another one.

The newly merged CP-KCS railways is also another development that could aid in the success of the CentrePort Canada Rail Park that is set to begin construction in the spring of 2022.

CentrePort is in the final stages of acquiring the 665 acres parcel of land just west of Sturgeon Road on the north side of CentrePort Canada Way. After a successful request for proposals a developer has been selected but will not be identified until the land purchase has been finalized.

The concept is an industrial park occupied by tenants — 20, 30 or more —that regularly require rail cars for rail shipments. The co-location of many shippers would make it more cost-efficient for them to use rail spurs that would connect to CP’s main line that runs nearby. (Inter-switching regulations would also give shippers access to CN and BNSF lines.)

martin.cash@freepress.mb.ca

Martin Cash

Martin Cash
Reporter

Martin Cash has been writing a column and business news at the Free Press since 1989. Over those years he’s written through a number of business cycles and the rise and fall (and rise) in fortunes of many local businesses.

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