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Factors affecting containerized intermodal OCP traffic movement through the port of Vancouver Lockhart, John Robert 1971

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FACTORS AFFECTING CONTAINERIZED INTERMODAL OCP TRAFFIC MOVEMENT THROUGH THE PORT OF VANCOUVER by JOHN ROBERT LOCKHART B. Sc. ( A g r ) , U n i v e r s i t y o f A l b e r t a , B. Ed. ( S e c ) , U n i v e r s i t y o f C a l g a r y , A THESIS SUBMITTED IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF BUSINESS ADMINISTRATION i n the F a c u l t y o f COMMERCE AND BUSINESS ADMINISTRATION We a c c e p t t h i s t h e s i s as conforming to the r e q u i r e d s t a n d a r d 1962 1969 THE UNIVERSITY OF BRITISH COLUMBIA June, 1971 In p r e s e n t i n g t h i s t h e s i s i n p a r t i a l f u l f i l m e n t o f the r e q u i r e m e n t s f o r an advanced degree at the U n i v e r s i t y o f B r i t i s h C o l u m b i a , I a g r e e t h a t t h e L i b r a r y s h a l l make i t f r e e l y a v a i l a b l e f o r r e f e r e n c e and s t u d y . I f u r t h e r agree t h a t p e r m i s s i o n f o r e x t e n s i v e c o p y i n g o f t h i s t h e s i s f o r s c h o l a r l y p u r p o s e s may be g r a n t e d by the Head o f my Department o r by h i s r e p r e s e n t a t i v e s . I t i s u n d e r s t o o d t h a t c o p y i n g o r p u b l i c a t i o n o f t h i s t h e s i s f o r f i n a n c i a l g a i n s h a l l not be a l l o w e d w i t h o u t my w r i t t e n p e r m i s s i o n . Department o f ( g s ^ / v ^ ^ The U n i v e r s i t y o f B r i t i s h C olumbia V a n c o u v e r 8, Canada Date 70, (97/. The conversion of many major international ocean trades to container faci l i t ies makes truly intermodal cargo movement possible. However the ocean carriers have embraced the concept of containerization with much more fervor than have the inland carriers. As a result the van container has been utilized much less than might be expected for inland cargo movement. This study has concentrated on the movement of cargo from the Far East to Eastern Canada via Vancouver, in an attempt to discern why 'OCP' traffic, which arrives in containers, is being destuffed and moved eastward in boxcars. This long-haul traffic appears to be of a commodity composition and volume which should move in intact containers. It has been concluded that the inland carrier rates are not conducive to the movement of cargo in intact containers. This is a reflection of unfavorable cargo density character-ist ics , and to some extent, a lack of containerized cargo volume. While the labor contract in force on the Vancouver waterfront discriminates against off-dock destuffing, the density,and rate considerations are sufficiently important that 'OCP' cargo should maintain its present non-intermodal characteristics. I INTRODUCTION 1 OBJECTIVES OF THE STUDY 5 IMPORTANCE OF THE STUDY 8 SCOPE OF THE STUDY - 9 INFORMATION SOURCES 9 THESIS ORGANIZATION 10 FOOTNOTES 12 I I GENERAL ECONOMICS OF CONTAINERIZATION IN INTERMODAL DEVELOPMENT 13 HISTORY OF CONTAINERIZATION 13 EARLY U.S. CO-ORDINATED TRANSPORT-ATION EXPERIENCE 1^ DEFINITIONS AND DESCRIPTIONS OF CONTAINERS 15 WORLD CONTAINER EVOLUTION AND DEVELOPMENT l 6 VANCOUVER DEEP-SEA CONTAINER DEVELOPMENT 18 H i s t o r y 18 Cur r e n t and Proposed Steamship Line S e r v i c e s 19 Japan 6 Line O p e r a t i o n 21 ADVANTAGES AND PROBLEMS OF CONTAINERIZATION 22 Advantages 22 Problems 24 SAVINGS FROM CONTAINERIZATION 25 INTERMODAL FREIGHT MOVEMENT 26 TRENDS IN INTERMODAL CONTAINERIZATION INVESTMENT 28 RAIL 28 World Developments 28 Canadian Experience 30 VESSEL AND PORT EFFICENCY 32 Port and Route Rationalization 33 ECONOMICS OF CONTAINERIZATION FOR VESSELS 35 COSTS IN OCEAN TRANSPORTATION . 35 Cargo Stowage 36 Ship Tonnage Measures 37 REPRESENTATIVE INVESTMENT IN CONTAINER VESSELS ' 38 Current and Future Trends 38 World Container Fleet 41 Ideal Container Ship Size 4 3 Container Systems of the Future 4 4 CONTAINERSHIP OPERATING COSTS 46 General Factors 46 The Arthur D. Little Study 48 Future Trends 51 Increased Speeds 51 Nuclear Power 52 ECONOMICS OF CONTAINERIZATION FOR PORTS 53 WORLD PORT INVESTMENT 53 PORT TECHNOLOGY CHANGES 55 Port Purpose: Deep-Sea or Feeder 55 LABOR AND CONTAINERIZATION COSTS IN PORTS 58 AIR MOVEMENT AND CONTAINERS 60 POTENTIAL CONTAINER CARGOES 61 World Scene 61 P o r t o f Vancouver 61 PORT OF VANCOUVER CENTENNIAL .PIER CONTAINER TERMINAL 62 SUMMARY 68 FOOTNOTES 71 I I I OVERLAND COMMON POINT TARIFFS AND TRAFFIC 85 OVERLAND COMMON POINT TARIFFS 85 OCP AND LOCAL RATE TERRITORY 86 APPROVED CARRIERS AND PORTS 86 HISTORY OF COMMON POINT RATES 90 UNITED STATES 90 Rate S t r u c t u r e 90 Fourth S e c t i o n P r o v i s i o n s 90 Cl a s s and Commodity Rates 91 U.S. C o n t a i n e r Rates 92 • F r e i g h t - A l l - K i n d s ' Rates 93 ICC Involvement i n Co-ordinated T r a n s p o r t a t i o n T a r i f f s 95 CANADA 96 H i s t o r i c a l Development 96 Cla s s Rates 97 Commodity Rates 98 Import and Export Rates and T a r i f f s 99 CANADIAN OCP TRAFFIC 100 HISTORY OF OCP RATES . 100 CARRIER ABSORPTION PRACTICES 104 CANADIAN RAILWAY IMPORT TARIFFS 106 CFA-25^-B 107 CFA-263 108 CFA-38-L 108 CFA-70-C 108 CFA-589-A 110 OCP CARGO TYPE AND VOLUME I l l TYPE OF CARGO I l l CONTAINERIZABLE EXPORT CARGOES 112 THE PORT OF VANCOUVER 115 Importance 115 Type of. Cargo Moved 118 VOLUME OF OCP CARGO MOVED TO EASTERN CANADA 121 Method of Movement 122 CONTAINERIZABLE CARGO VOLUME 124 Land Bridge 126 P o r t of Vancouver C o n t a i n e r S t u d i e s Reviewed 128 C o n t a i n e r i z a b l e Cargo Tonnages From 'OCP O r i g i n ' Nations 131 Japanese Trade 1*H ACTUAL CONTAINER TRAFFIC IN PORT OF VANCOUVER 1*14 SUMMARY . 150 FOOTNOTES 152 IV OCP RATES AND TERMINAL CHARGE APPLICATION FOR CARGO IN CONTAINERS 159 OCP CHARGES 160 SUMMARY OF CONTAINER PROVISIONS FOR OCP TRAFFIC 161 Ocean F r e i g h t Charge Determination .... 161 R a i l F r e i g h t Rate Determination 163 Example 1 165 Example 2 165 TERMINAL CHARGE APPLICATION 168 TERMINAL CHARGES DEFINED 168 TERMINAL CHARGE APPLICATION 169 Wharfage and Ha n d l i n g I 6 9 S e r v i c e and F a c i l i t y Charge 171 Loading 171 Crane 172 TERMINAL CHARGE ABSORPTIONS 17^ Examples of A b s o r p t i o n P r a c t i c e s 175 CONDITIONS UNDERSCORING DESTUFFING ON THE VANCOUVER WATERFRONT 180 LABOR UNION AGREEMENT 180 EMPTY CONTAINER RATES FROM THE PRAIRIES l 8 l CARGO CHARACTERISTICS 182 The Problem of * Mixed Shipments' 182 Cargo D e n s i t y C o n s i d e r a t i o n s i n R e l a t i o n to Equipment C a p a c i t y 183 Con t a i n e r C a p a c i t y I 8 5 R a i l Boxcar C a p a c i t y 185 Road Equipment C a p a c i t y 186 CHAPTER PAGE SUMMARY ' . 188 FOOTNOTES 189 V LABOR UNION RESPONSE TO INTERMODAL CONTAINERS 192 LABOR UNION RESPONSE TO CONTAINERIZATION '193 REDUCED HANDLING EXPECTED TO LOWER INSURANCE COSTS .. 19^ CONTAINERIZATION RESULTS IN INCREASED HANDLING SPEED 196 Reduction i n P o r t Numbers 197 WHO BENEFITS FROM CONTAINERIZATION: LABOR, MANAGEMENT, OR BOTH 198 REGIONAL ADAPTATION TO CONTAINERIZATION 201 CONTINENTAL EUROPE 201 THE UNITED KINGDOM 201 THE UNITED STATES EAST COAST 203 1968 C o n t r a c t N e g o t i a t i o n s 203 Longshore Agreement Container Clauses 204 THE UNITED STATES WEST COAST 205 H i s t o r y of United S t a t e s West Coast Agreement 206 C o n t a i n e r Clauses i n the Agreement .... 206 Outlook For 1971 207 EASTERN CANADA 208 Labor I n q u i r i e s 209 C o n t a i n e r i z a t i o n Clauses 209 THE VANCOUVER DOCK WORKERS CONTRACT 211 CONTRACT NEGOTIATION PROBLEMS 211 CONTRACT CONDITIONS REGARDING CONTAINERIZATION 213 S i z e and S t r u c t u r e o f Co n t a i n e r Crew on C e n t e n n i a l P i e r 2 1 5 The Outlook 2 1 7 SUMMARY ..... 219 FOOTNOTES 221 VI OTHER FACTORS WHICH TEND TO PREVENT INTERMODAL TRANSFER OF CONTAINERIZED CARGO 2 2 5 CUSTOMS 2 2 6 DOCUMENTATION 2 2 8 SORTATION PROCEDURES 2 3 0 OTHER FACTORS . 232 FOOTNOTES 2 3 ^ V I I CONCLUSIONS AND SUMMARY 2 3 5 CONCLUSIONS 2 3 6 OCEAN RATES 2 3 7 TERMINAL CHARGES 2 3 8 INLAND CARRIER RATES ' 2 3 8 SORTATION 2 3 9 WATERFRONT LABOR . 2 3 9 SUMMARY 24l FOOTNOTE . . • 242 BIBLIOGRAPHY 2^3 APPENDIX 2.1 CONTAINER SHIPS ON ORDER 42 2.2 OPERATING COSTS OF BREAK-BULK CARGO SHIPS '4? 2.3 ANNUAL OPERATING COSTS FOR A 29,000 g r t CONTAINER SHIP TRAVELLING AT 22 KNOTS 50 2.4 EXAMPLES OF INVESTMENT BY SELECTED WORLD PORTS FOR DEEP-SEA CONTAINER HANDLING FACILITIES 54 3.1 EXAMPLES OF COMMODITY RATES CHARGED UNDER THE JAPAN-WEST CANADA FREIGHT CONFERENCE TARIFF No. 2 103 3.2 MAJOR EXPORT CARGOES FROM CANADA TO SELECTED "OCP ORIGIN" COUNTRIES BY CANADIAN REGION 1966 to 1968 113 3.3 TONNAGE OF CONTAINERIZABLE COMMODITIES EXPORTED TO FOREIGN COUNTRIES BY CANADIAN PORT REGION 114 3.4 A COMPARISON OF THE PORT OF VANCOUVER WITH ALL BRITISH COLUMBIA PORTS FOR TOTAL INTERNATIONAL SEABORNE AND FOR GENERAL CARGO UNLOADED 116 3.5 TOTAL DEEP SEA CARGO MOVEMENTS THROUGH THE PORT OF VANCOUVER 1962 --197.0 117 3.6 TONNAGE OF ALL INTERNATIONAL SEABORNE CARGO CLASSED AS "OTHER COMMODITIES" UNLOADED BY MAJOR PORT IN B. C. 119 3.7 THOUSANDS OF SHORT TONS OF GENERAL CARGO UNLOADED AT BRITISH COLUMBIA PORTS BY SELECTED MAJOR COMMODITY GROUP 120 3.8 CONTAINER ON FLAT CAR MOVEMENT EASTERN AND WESTERN RAIL REGIONS , 123 3.9 RAILROAD POOLCAR MOVEMENTS EASTERN AND WESTERN RAIL. REGIONS 125 3.10 POTENTIAL CANADIAN CONTAINER TRAFFIC USING THE TWO LAND BRIDGE CONCEPTS 127 3.11 PROJECTED NUMBER OF CONTAINERS HANDLED PORT OF VANCOUVER 1968 - 1975 130 3.12 IMPORTS BY CANADIAN PORT REGION FOR SELECTED "CONTAINERIZABLE" COMMODITIES FROM "OCP ORIGIN" COUNTRIES . 132 3.13 SEA DISTANCES BETWEEN MAJOR PORTS 133 3.14 IMPORTED TONNAGES FROM SELECTED "OCP ORIGIN" COUNTRIES THROUGH CANADIAN PACIFIC COAST PORTS 135 3.15 CARGO UNLOADED AT PORT OF VANCOUVER IMPORTS FROM SELECTED "OCP ORIGIN" COUNTRIES 1961 - 1970 136 3.16 CANADIAN (CONTAINERIZABLE) IMPORTS FROM "OCP ORIGIN" NATIONS BY YEAR THROUGH THE PORT OF VANCOUVER 1 3 8 3.17 CONTAINERIZABLE TONNAGES OF CANADIAN IMPORTS STEEL AND ORES EXCLUDED FROM "OCP ORIGIN" NATIONS BY YEAR THROUGH THE PORT OF VANCOUVER 1967 - 1970 139 3.18 JAPANESE EXPORTS TO CANADA 1967-1969 1^ 2 3.19 CONTAINERS IMPORTED ON VESSELS OF THE JAPAN 6 LINES 1970 - 1971 1^5 3.20 CONTAINERS EXPORTED ON VESSELS OF THE JAPAN 6 LINES 1970 - 1971 1^ 6 3.21 TONS OF IMPORTS PER CONTAINER INITIAL VOYAGES JAPAN 6 LINES TO VANCOUVER B. C. BY COMMODITY GROUP 148 3.22 TONS OF EXPORTS PER CONTAINER INITIAL VOYAGES JAPAN 6 LINES FROM VANCOUVER 149 4.1 SOME EXAMPLES OF COMPARATIVE CHARGES FOR COMMODITIES MOVED BY POOLCAR AND IN INTACT CONTAINERS 167 4.2 RELATIVE TERMINAL CHARGES PER REVENUE TON PORT OF VANCOUVER FOR CARGO ARRIVING BY DIFFERENT METHODS 173 4.3 EXAMPLES OF TERMINAL CHARGE ABSORPTIONS BY OCEAN AND RAIL CARRIERS FOR CARGO OF VARIOUS DENSITIES 177 4.4 SOME EXAMPLES OF COMPARATIVE TOTAL LINE HAUL CHARGES TO THE CONSIGNEE FOR OCP CARGO MOVED THROUGH THE PORT OF VANCOUVER BY THE JAPAN 6 LINES SHOWING THE REIATIVE ABSORPTIONS IN POOLCARS vs INTACT CONTAINERS 179 4.5 SAMPLE CONTAINER LOAD PLANS FOR IMPORTED CFS CONTAINERS VANCOUVER CONTAINER TERMINAL May 1971 184 5.1 CONTAINER HANDLING RATE AT CENTENNIAL PIER INITIAL VOYAGES OF JAPAN 6 LINES 1970 - 1971 ' 216 Fig. 1.1 A COMPARISON OF AN INTEGRATED CONTAINER VESSEL SYSTEM WITH PRESENT BREAK-BULK VESSEL METHODS 3 MAP 2.1 PORT OF VANCOUVER CONTAINER TERMINAL 64 MAP 3.1 LOCAL AND OVERLAND COMMON POINT TERRITORY 87 MAP 3.2 ORIGIN AREAS FOR TRAFFIC MOVING TO OVERLAND COMMON POINT CENTERS 88 Fig. 3.1 PROJECTED CARGO TONNAGES TO BE SHIPPED IN CONTAINERS THROUGH THE PORT OF VANCOUVER 129 Fig. 5.1 NUMBER OF TIMES CARGO IS HANDLED FROM. SHIPPER TO THE CONSIGNEE 195 The author thanks the many r e p r e s e n t a t i v e s of the T r a n s p o r t a t i o n Industry who have a s s i s t e d i n t h i s study. These i n c l u d e the many i n d i v i d u a l s who have so w i l l i n g l y p r o v i d e d i n t e r v i e w time and d e t a i l e d e x p l a n a t i o n s of the c o n t a i n e r scene i n Vancouver. S p e c i a l thanks are extended t o : Mr. Gordon Payne, Mr. P e t e r S e n i o r , & Mr. John Shaneman of Empire S t e v e d o r i n g Co.; Mr. Gordon Cameron, Mr. Gordon King, & Mr. Dale Spink, S h i p p i n g Agents; Mr. G i l l F r o n t a i n , Mr. C h a r l e s Crook, Mr. A l b e r t Thomson, & Mr. E r i c S t a t o n of the Canadian N a t i o n a l Railway Co.; Mr. Stan Garrod of the Canadian P a c i f i c Railway Co.; Mr. Dave Edgeworth of The B u r l i n g t o n Northern Railway Co.; Mr. John Shaw of G i l l I n t e r n a t i o n a l Transport; Mr. Barry Lindsay of Johnston Terminals L t d . ; Mr. Ken Cox of Western Assembly; Mr. Don McGregor, Canada Customs O f f i c e r ; Mr. Len C a r l y l e & Miss M a r j o r i e M c G e r r i g l e of the N a t i o n a l Harbour's Board; and to Mr. H a r r i s o n and members of the ILWU. Thanks are a l s o due to the Canadian Transport Commission, w i t h the a i d o f whose F e l l o w s h i p t h i s work was undertaken, and f i n a l l y to Dr. Treavor Heaver, Thesis Chairman f o r h i s h e l p f u l and encouraging comments and a s s i s t a n c e . A l s o s i n c e r e thanks to my w i f e , May, f o r her p a t i e n c e and a s s i s t a n c e i n the t y p i n g of t h i s t h e s i s . INTRODUCTION The concept of c o n t a i n e r i z a t i o n i s one of the most w i d e l y d i s c u s s e d developments i n t r a n s p o r t a t i o n today. S i n c e i t s " r e d i s c o v e r y " i n the mid-1950's, i t s growth r a t e has been comparable to t h a t of the human p o p u l a t i o n i n the 20th Century. L i k e many ot h e r 'new' i d e a s , the ' b i g box' may be o n l y a p a s s i n g phase? but i f i t f o l l o w s the E d s e l and h u l a hoop i n t o o b l i v i o n , the economic consequences c o u l d w e l l be c a t a s t r o p h i c . T h i s i s n e i t h e r a t h r e a t nor a f o r e c a s t ; i t i s a p l e a f o r an . e n l i g h t e n e d approach to t h i s 'new' method of m a t e r i a l s h a n d l i n g . The number of persons who r e a l l y understand what the 'box' can do, and perhaps even more important, what i t cannot do, i s , u n f o r t u n a t e l y , r a t h e r l i m i t e d . While the steamship companies have endorsed the c o n t a i n e r wholeheartedly, t h e i r ' v i s i o n ' has not, f o r the most p a r t , been shared by e i t h e r the s h i p p e r s , l a n d c a r r i e r s , or consignees. As a r e s u l t the m a j o r i t y of van c o n t a i n e r s have been f o r ocean, not i n t e r m o d a l use. The o n l y ' r a i s o n d ' l i t r e ' f o r c o n t a i n e r i z i n g cargo shipments i s to reduce the t o t a l t r a n s p o r t a t i o n c o s t . I f a c o n t a i n e r is the most e f f e c t i v e way of doing t h i s , then, the sooner everyone •gets the message' the b e t t e r . But i f a c o n t a i n e r i s not s u p e r i o r to p r e s e n t p a l l e t i z a t i o n methods, then i t becomes even more important t h a t the 'word' be spread, because c o n t a i n e r i z a t i o n (1) the a c t u a l r a t e ( s ) charged, and (2) the time i n v o l v e d i n moving goods from the producer to the consumer. Because of the e x t e n s i v e p o l i t i c a l involvement i n r a t e s t r u c t u r e s and the almost u n i v e r s a l l a c k o f c o s t - o r i e n t e d p r i c i n g p r a c t i c e s by most modes of. t r a n s p o r t , r e l a t i v e l y l i t t l e immediate r e d u c t i o n i n t r a n s p o r t a t i o n c o s t s can be expected i n t h i s d i r e c t i o n . However, tim e - s a v i n g s p r e s e n t an e a s i l y a p p r a i s e d source o f c o s t r e d u c t i o n s . 1 McKinsey and Company i n a g r a p h i c comparison of the economic time advantages of c o n t a i n e r i z a t i o n over break-bulk cargo h a n d l i n g methods (see F i g . 1.1), concluded t h a t c o n t a i n e r s h i p s would r e q u i r e l e s s time i n p o r t , r e s u l t i n g i n an i n c r e a s e i n the number of voyages per s h i p per year; thus fewer v e s s e l s would be r e q u i r e d to move a g i v e n q u a n t i t y of cargo i n a g i v e n time p e r i o d . P r o v i d i n g the l a n d c a r r i e r s possess the proper h a n d l i n g equipment, th e r e i s no reason why the same r e s u l t s s h o u l d not be o b t a i n e d i n o v e r l a n d cargo movements. P r o p e r l y a p p l i e d , c o n t a i n e r i z a t i o n g i v e s completely i n t e r m o d a l movement o f cargo w i t h complete i n t e r c h a n g e a b i l i t y o f the 'box' between the v a r i o u s l a n d , sea, and a i r t r a n s p o r t modes. Bef o r e t h i s can be a c h i e v e d however, both s h i p p e r s and c a r r i e r s must be prepared to r e a p p r a i s e and r e v i s e t h e i r t r a d i t i o n a l t r a n s p o r t a t i o n p a t t e r n s . The u l t i m a t e aim must be to move cargo from the s h i p p e r s to the consignee's door as r a p i d l y and i n e x p e n s i v e l y as p o s s i b l e . FIGURE 1.1  A COMPARISON OF AN  INTEGRATED CONTAINER VESSEL SYSTEM WITH PRESENT BREAK-BULK VESSEL METHODS Per cent o f ship's l i f e i n p o r t Number o f voyages p e r s h i p p e r y e a r 80 60 40 20 -80 H 6 0 . 40-20-P r e s e n t - v Break-Bulk - v . ^ Method Co n t a i n e r s h i p s spend l e s s time i n p o r t . . . . I n t e g r a t e d . Container -Sy_s_tem 2 4 6 8 Trade r o u t e m i l e s (one way) Thousands I n t e g r a t e d C o n t a i n e r System 10 Co n t a i n e r s h i p s make more voyages per y e a r . P r e s e n t break-T3ttlk -me-thed-9--2 4 6 TT~ Trade r o u t e m i l e s (one way) Thousands To Source: " C o n t a i n e r i z a t i o n : The Key to Low Cost Transport", A Report f o r the B r i t i s h Docks A u t h o r i t y , McKinsey and Co., London. June 1967. P« A s t h e s i m p l i s t way t o a c c o m p l i s h t h i s s h o u l d be t o u s e t h e same p a c k a g e f o r t h e e n t i r e movement, s h i p p e r and c a r r i e r i n t e r e s t i n , a n d t h e a d o p t i o n , o f , c o m p l e t e c o n t a i n e r i z a t i o n s h o u l d r a p i d l y i n c r e a s e among t h e t r a d i n g n a t i o n s o f t h e w o r l d . A s h i f t i n i n l a n d c a r g o h a n d l i n g methods c o m p a r a b l e t o t h a t o f o c e a n t r a n s p o r t a t i o n has n o t y e t d e v e l o p e d . I f t h e c o s t a d v a n t a g e s c l a i m e d f o r c o n t a i n e r i z a t i o n a r e r e a l , t h e f a i l u r e t o move i n t a c t c o n t a i n e r s t o t h e c o n s i g n e e ' s d o o r i s a s e v e r e m i s a l l o c a t i o n a n d w a s t e o f r e s o u r c e s . However t h i s p r o c e d u r e c a n o n l y be s u c c e s s f u l i f e v e r y o n e c o n c e r n e d w i t h c a r g o t r a n s f e r t h i n k s i n t e r m s o f t h e l o w e s t TOTAL c o s t ( a n d l o w e s t t o t a l p r i c e ) . The c o n c e p t o f a c o m p l e t e l y i n t e r m o d a l c a r g o movement has b e e n known s i n c e t h e e a r l y 19th C e n t u r y , b u t i t has o n l y become p r a c t i c a l a n d a c c e p t e d i n t h e m i d-20th C e n t u r y . I n many i n s t a n c e s s h i p p e r s a n d c a r r i e r s have n o t f u l l y g r a s p e d t h e s i g n i f i c a n c e o f t h e c o m p l e t e c o n t a i n e r c o n c e p t f o r l o c a l , n a t i o n a l , o r i n t e r n a t i o n a l c a r g o t r a n s f e r , even t h o u g h t h e y may be u s i n g c o n t a i n e r s . I n s p i t e o f t h e f a c t t h a t one o f t h e f i r s t c o n t a i n e r s h i p 2 r o u t e s i n t h e w o r l d was o p e r a t e d o u t o f t h e P o r t o f V a n c o u v e r , t h e commitment t o deep s e a c o n t a i n e r i z a t i o n has b e e n s l o w t o d e v e l o p i n t h e P a c i f i c N o r t h West r e g i o n o f N o r t h A m e r i c a . T r a d i t i o n a l l y Canadian imports through the P o r t o f Vancouver have a r r i v e d i n break-bulk form on e i t h e r l i n e r o r tramp steamships. The cargo was o f f - l o a d e d by the longshoremen, but o f t e n without r e f e r e n c e to the proper B i l l o f L a d i n g . T h i s n e c e s s i t a t e d c o n s i d e r a b l e h a n d l i n g and s o r t i n g by longshore l a b o r i n the f r e i g h t sheds b e f o r e the cargo c o u l d be p r o p e r l y c o n s o l i d a t e d i n t o t r u c k l o a d o r r a i l c a r l o a d l o t s f o r fo r w a r d i n g . The s w i t c h to c o n t a i n e r i z e d cargo movement has g r e a t l y reduced, but not e n t i r e l y e l i m i n a t e d t h i s problem. A t the p r e s e n t time c o n t a i n e r v e s s e l s a r r i v i n g a t the P o r t of Vancouver from Japan and the F a r E a s t belong to the "Japan 6" L i n e , and American M a i l ; from A u s t r a l i a and New Zealand the P a c i f i c A u s t r a l i a D i r e c t (PAD) L i n e ; with the European trade r e p r e s e n t e d by Johnson L i n e and ScanStar S e r v i c e s . These L i n e s use C e n t e n n i a l P i e r , the F r a s e r - S u r r e y Dock, and LaPointe P i e r as t h e i r r e s p e c t i v e t e r m i n a l p o i n t s . I n a d d i t i o n , The White Pass and Yukon c o n t i n u e s to move c o n t a i n e r s o f ore to t h e i r dock i n North Vancouver. Some c o n t a i n e r s c a r r i e d by SeaLand, Inc. and American M a i l L i n e s are a l s o a r r i v i n g i n Vancouver from S e a t t l e by t r u c k o r the B u r l i n g t o n Northern R a i l r o a d . The primary purpose of t h i s t h e s i s i s to document the r e l a t i v e m e r i t s o f moving goods imported from A u s t r a l i a , New Zealand and the O r i e n t i n i n t a c t i n t e r m o d a l van c o n t a i n e r s through the P o r t o f Vancouver to E a s t e r n Canadian d e s t i n a t i o n s . Only the t r a f f i c o r i g i n a t i n g i n n a t i o n s d e s i g n a t e d as w i t h i n the "Overland Common P o i n t " (OCP) o r i g i n t e r r i t o r y and moving to Canadian d e s t i n a t i o n s e a s t o f the Manitoba-Saskatchewan border i s d i s c u s s e d . The c o n c l u s i o n s reached a p p l y s p e c i f i c a l l y to t h i s OCP t r a f f i c and should not be const r u e d as n e c e s s a r i l y a p p l y i n g to o t h e r t r a f f i c which a l s o e n t e r s Canada through the P o r t o f Vancouver. With v e r y few e x c e p t i o n s , 'break-bulk cargo' c u r r e n t l y a r r i v i n g a t the P o r t o f Vancouver i n c o n t a i n e r s i s b e i n g removed from the c o n t a i n e r s ( d e s t u f f e d ) by longshore l a b o r on the docks, and subsequently t r a n s f e r r e d to r a i l r o a d p o o l c a r s o r motor c a r r i e r t r a n s p o r t s f o r movement eastward. I f i t comes from A u s t r a l i a , New Zealand, or any A s i a n or A f r i c a n c o u n t r y d e s i g n a t e d as an "OCP o r i g i n n a t i o n " and, a f t e r p a s s i n g through a west c o a s t North American p o r t , the cargo moves a t l e a s t as f a r e a s t as the Manitoba-Saskatchewan border, i t w i l l q u a l i f y f o r the lower Overland Common P o i n t ocean t a r i f f . I f the i n l a n d movement i s by approved c a r r i e r (except t r u c k ) , the cargo w i l l a l s o q u a l i f y f o r the a b s o r p t i o n p r a c t i c e s o f the steamship and r a i l r o a d companies f o r the t e r m i n a l charges i n c u r r e d on the Vancouver w a t e r f r o n t . Cargo which i s d i s c h a r g e d i n S e a t t l e , but which q u a l i f i e s f o r the OCP ocean r a t e , w i l l a l s o be e l i g i b l e f o r the a b s o r p t i o n by the r a i l r o a d s o f the $ 9 . 0 0 per ton c a r l o a d i n g charges, when the cargo does, i n f a c t , move to OCP d e s t i n a t i o n t e r r i t o r y . Most of the c o n t a i n e r i z e d cargo imported v i a the P o r t of S e a t t l e , i s d e s t u f f e d a t the Vancouver premises of f r e i g h t forwarders, and t r a n s f e r r e d to i n l a n d o r OCP d e s t i n a t i o n s by t r u c k o r This paper advances the hypothesis that Overland Common Point t r a f f i c i s both suited to, and suitable for, containeriz-ation; as a result i t should arrive in Vancouver in a sealed container, be off-loaded from the ship and be loaded directly onto a r a i l c a r , for forwarding in that intact container to i t s Eastern Canadian destination. Destuffing should only occur at the Eastern Canadian consignee's warehouse. While the ideal would be for the consignor and consignee to have door-to-door shipment, this i s not inherent in the OCP t a r i f f s , since these are s t r i c t l y ocean rates, not ocean-rail joint t a r i f f s . Since this 'suitable* t r a f f i c has not been moving East in the intact import container (but rather in boxcars), the question of 'Why Not?' has been studied. Admittedly the new container handling f a c i l i t i e s on Centennial Pier have only been operational since mid - 1 9 7 0 , but imported cargo in containers has been unloaded at the Port of Vancouver since 1 9 6 8 . Even so, by the beginning of 1971» very few intact containers had actually moved to OCP destinations. With the i n t r o d u c t i o n of c o n t a i n e r s h i p s on a r e g u l a r schedule by the Japan 6, Johnson L i n e , American M a i l L i n e s , and A u s t r a l i a D i r e c t L i n e (which docks a t New Westminster) t r u l y i n t e r m o d a l f r e i g h t t r a n s p o r t a t i o n i s now p o s s i b l e through the P o r t o f Vancouver. I t appears reasonable to assume t h a t imported cargo w i l l not move i n c o n t a i n e r s from the s h i p p e r ' s door to the consignee's warehouse, u n l e s s t h i s method has a r a t e and/or time advantage over the t r a d i t i o n a l o c e a n - b r e a k - b u l k - r a i l - p o o l c a r movement. T h i s means t h a t the p r o v i s i o n o f new equipment i n the form of van c o n t a i n e r s , f u l l y c o n t a i n e r i z e d v e s s e l s , and i n l a n d c o n t a i n e r bogies and c h a s s i s , must show a l a r g e r r e t u r n on investment ( a f t e r i n c l u s i o n o f the c o s t o f abandoning p r e s e n t equipment), than the c a r r i e r s are p r e s e n t l y o b t a i n i n g . However f i n a n c i a l c o n s i d e r a t i o n s are not the o n l y f a c t o r s to be taken i n t o account i n t h i s matter. Such t h i n g s as the problems of documentation (which i s s i m u l t a n e o u s l y s u i t a b l e to the needs of the s h i p p e r , c a r r i e r , customs i n s p e c t o r s , i n s u r a n c e companies, and the customer); the response of l a b o r unions; i n s u r a n c e and government r e g u l a t i o n s ; and equipment s t a n d a r d -i z a t i o n ; must a l s o be c o n s i d e r e d i n any e v a l u a t i o n of i n t e r m o d a l u n i t i z a t i o n . T h i s study p r e s e n t s a b r i e f h i s t o r y o f in t e r m o d a l c o n t a i n e r i z a t i o n and the e f f e c t t h a t the van c o n t a i n e r has had on both the p o r t s and c a r r i e r s . I t co n c e n t r a t e s on some o f the problems a s s o c i a t e d with the n o n - i n t e r m o d a l i t y o f c o n t a i n e r s on the Vancouver w a t e r f r o n t , p a r t i c u l a r l y those o f p o r t charges and a b s o r p t i o n , r a t e s , and l a b o r union response. An a n a l y s i s of the volume o f OCP t r a f f i c , and the r a i l r a t e s i n v o l v e d as these r e l a t e to boxcar, motor c a r r i e r , and i n l a n d c o n t a i n e r t r a f f i c movement by t r u c k and r a i l has been undertaken i n an attempt to determine why imported goods are not moving Eastward from Vancouver i n i n t a c t c o n t a i n e r s . INFORMATION SOURCES C o n s i d e r a b l e r e l i a n c e has been p l a c e d on the o p i n i o n s , data, and i n f o r m a t i o n made a v a i l a b l e by p e r s o n n e l o f the r a i l w a y s , steamship agents, motor c a r r i e r s , government ag e n c i e s , and s t e v e d o r i n g companies because t h e r e i s v e r y l i t t l e p u b l i s h e d m a t e r i a l i n t h i s a r ea. I n f o r m a t i o n has a l s o been gleaned from the p u b l i s h e d t a r i f f s o f the p o r t s , Steamship Conference, and i n l a n d c a r r i e r s . T h i s i n t r o d u c t o r y Chapter has o u t l i n e d the o b j e c t i v e s and importance o f t h i s study to Canadian Overland Common P o i n t T r a f f i c . I t has proposed the h y p o t h e s i s t h a t OCP t r a f f i c can and s h o u l d be c o n t a i n e r i z e d to f a c i l i t a t e i t s o v e r l a n d movement i n t r u e i n t e r m o d a l f a s h i o n . Chapter I I d i s c u s s e s the g e n e r a l economic c h a r a c t e r i s t i c s of c o n t a i n e r i z e d f r e i g h t movement. F o l l o w i n g a b r i e f d i s c u s s i o n of the h i s t o r y o f c o n t a i n e r s i n the world and North American f r e i g h t scene, a number of economic f a c t o r s t h a t must be co n s i d e r e d by c a r r i e r s and p o r t s engaging i n i n t e r m o d a l c o n t a i n e r h a n d l i n g are d i s c u s s e d . S p e c i f i c a l l y i t d e a l s w i t h the e x t e n s i v e c a p i t a l investment t h a t i s i n v o l v e d i n any d e c i s i o n to c o n t a i n e r i z e a t r a d e or r o u t e , and wit h the c o s t s and b e n e f i t s t h a t have appeared. Chapter I I I d e s c r i b e s the development o f Overland Common P o i n t t a r i f f s w i t h p a r t i c u l a r emphasis on the Canadian e x p e r i e n c e . The s i g n i f i c a n c e , i n tonnage and percentage terms, of OCP to t o t a l Canadian g e n e r a l or break-bulk cargo volumes i s ex p l o r e d a l o n g w i t h a d i s c u s s i o n on the s u i t a b i l i t y and p r o b a b i l i t y of t h i s cargo b e i n g c o n t a i n e r i z e d . The next two Chapters (IV and V) are the economic h e a r t o f t h i s study with the r e l e v a n t f a c t o r s l e a d i n g to n o n - i n t e r -m o d a l i t y o f t h i s t r a f f i c b e i n g d i s c u s s e d . While a number of minor f a c t o r s e n t e r the p i c t u r e , the major ones are the pre s e n t r a t e s t r u c t u r e o f the i n l a n d c a r r i e r s ( d i s c u s s e d i n Chapter IV) The f i n a l Chapter summarizes the f i n d i n g s of the study and p r e s e n t s the c o n c l u s i o n s reached i n t h i s r a p i d l y changing a r e a of f r e i g h t movement. CHAPTER I 1. " C o n t a i n e r i z a t i o n * The Key to Low Cost Transport", Report f o r the B r i t i s h Docks A u t h o r i t y , McKinsey and Co., London. June 1967. E x h i b i t s II-IV, p. 14. 2. C. Clapham, " C o n t a i n e r i z a t i o n i n the S e v e n t i e s " , Proceedings of the Canadian T r a n s p o r t a t i o n Research Forum. Pa n e l D i s c u s s i o n , Vancouver, B.C. March 20, 1970. p. 2. c f . "A New White Pass C o n t a i n e r Route Serves the Yukon and Northern B r i t i s h Columbia", A d v e r t i z i n g l i t e r a t u r e of the White Pass and Yukon Railway Company. In "Frank H. Brown", the f o l l o w i n g statement i s made: " C a p i t a l f o r the new Yukon f r e i g h t system was found and i n 1955, White Pass and Yukon Route launched i t s own s h i p , the 4,000-ton C l i f f o r d J . Rogers, c r e a t i n g the f i r s t White Pass ocean l i n k between Vancouver and Skagway. At the same time White Pass p i o n e e r e d the c o n t a i n e r concept of f r e i g h t h a n d l i n g by i n t r o d u c i n g temperature c o n t r o l l e d s t e e l c o n t a i n e r s . I t i s g e n e r a l l y c o n s i d e r e d t h a t the C l i f f o r d J . Rogers was the world's f i r s t s h i p designed s p e c i f i c a l l y to handle c o n t a i n e r s and c o n t a i n e r i z e d f r e i g h t . " p. 2. GENERAL ECONOMICS OF CONTAINERIZATION IN INTERMODAL DEVELOPMENT HISTORY OF CONTAINERIZATION The move to c o n t a i n e r i z a t i o n has "been d e s c r i b e d as both a r e v o l u t i o n and an e v o l u t i o n , but P r o f e s s o r S.G. Sturmey suggests t h a t the " c o n t a i n e r r e v o l u t i o n can be seen as a r e v o l u t i o n i n 1 p a c k i n g , as much as i n t r a n s p o r t " . The e x t e n s i v e and r a p i d c o n v e r s i o n o f ocean going cargo f a c i l i t i e s to c o n t a i n e r s i n d i c a t e s t h a t those L i n e s which do not ' c o n t a i n e r i z e ' c o u l d be excluded from much of the world's commerce i n the n o t - t o o -d i s t a n t f u t u r e . The i d e a o f cargo u n i t i z a t i o n i s c e r t a i n l y not new. Even the i d e a o f c o n t a i n e r i z a t i o n i n l a r g e 'boxes' i s f a r from 2 r e v o l u t i o n a r y , b e i n g d e s c r i b e d i n d e t a i l as l o n g ago as 1801. However the s i z e of ' c o n t a i n e r s ' under d i s c u s s i o n has g r a d u a l l y i n c r e a s e d . Because of these changes over the p a s t 150 y e a r s , the word ' e v o l u t i o n * appears to be more a p p r o p r i a t e than ' r e v o l u t i o n ' , when d e s c r i b i n g the changes wrought by c o n t a i n e r i z a t i o n . The c o - o r d i n a t e d movement o f c o n t a i n e r s , "which may v a r y i n s i z e from r a i l r o a d c a r s , highway t r u c k s , s e m i - t r a i l e r s , or t r a i l e r s , to much smaller r e c e p t a c l e s " , such as those used i n a i r f r e i g h t , r e f e r s to a c o - o r d i n a t i o n of s e r v i c e s from o r i g i n to d e s t i n a t i o n by more than one mode of t r a n s p o r t a t i o n without a t r a n s f e r of the B i l l of Lading. Examples of the methods of cargo t r a n s f e r i n v o l v e d would bei (1) piggyback - the movement of both t r a i l e r s and containers on r a i l r o a d f l a tears (.TOFC, COFC); (2) s e a t r a i n - r a i l r o a d cars on ocean-going f e r r i e s ; (3) f ishyback - motor c a r r i e r t r a i l e r s on deep-sea f e r r i e s ; and (4) b i r d i e b a c k - motor c a r r i e r t r a i l e r s i n a i r c r a f t . EARLY U.S. CO-ORDINATED TRANSPORTATION EXPERIENCE Intermodal cargo c o - o r d i n a t i o n of t h i s type was used between 1843 and 1857 i n the United States when canal boats, as the f r e i g h t c a r r y i n g equipment, were mounted on r a i l r o a d cars 5 f o r forwarding. In 1847 passenger's baggage was placed i n c o n t a i n e r s , moved by f e r r y from P h i l a d e l p h i a to Comden, and then loaded (four containers per f l a t c a r ) f o r movement with the passenger t r a i n s . That same year a l s o saw containers handled on f l a t c a r s between Boston and F a l l R i v e r , Mass., and by ship from F a l l R i v e r to New York. "Farmer's T r a i n s " began operation i n 1885, and c a r r i e d four produce wagons on each f l a t c a r . (The teams were loaded i n t o boxcars, and moved with the same t r a i n . ) Demountable truck bodies were f i r s t used i n 1917* and l e s s - t h a n - c a r l o a d containers came i n t o operation i n 1921. By 1926, the movement of c o n v e n t i o n a l - d e s i g n highway t r a i l e r s had begun. "A r a i l wagon f o r combining pickup and d e l i v e r y s e r v i c e w i t h a r a i l l i n e - h a u l was t r i e d i n 1898, 191^» and 6 a g a i n i n 1930." In 1929» r a i l r o a d c a r s were moved i n s h i p s s p e c i f i c a l l y designed f o r t h i s purpose between New Orleans, La., and Havana, Cuba; and the s e r v i c e was expanded i n 1932 to 7 i n c l u d e Hoboken, N.J. These s e r v i c e s were the p r e d e c e s s o r s of the modern deep-sea v a n - c a r r y i n g c o n t a i n e r s h i p s . DEFINITIONS AND DESCRIPTIONS OF CONTAINERS There are a g r e a t number of c o n t a i n e r s , of v a r i o u s shapes and of a l l s i z e s , i n use i n world commerce. T h i s study w i l l be r e s t r i c t e d to the group known as 'van c o n t a i n e r s ' , which may g e n e r a l l y be d e s c r i b e d as those c o n t a i n e r s of s u f f i c i e n t s i z e and s t r u c t u r a l q u a l i t i e s t h a t they may be used i n s t e a d o f motor c a r r i e r t r a i l e r boxes, and i n repeated i n t e r m o d a l use. S p e c i f i c a l l y the van c o n t a i n e r s under d i s c u s s i o n are those meeting the standards . e s t a b l i s h e d by the I n t e r n a t i o n a l Standards O r g a n i z a t i o n (ISO) i n 1968 i n t h e i r D r a f t Recommendations #804 and #830, (see Appendix I and I I f o r ISO Terminology). Even more s p e c i f i c a l l y t h i s study d e a l s with those i n t e r m o d a l c o n t a i n e r s of ISO S e r i e s IA (8' x 8' x 40'), and IC (8* x 8 x 20'), a l t h o u g h r e f e r e n c e w i l l be made on o c c a s i o n to o t h e r s i z e s , (see Appendix I I ) . These might be o f : (1) a d i f f e r e n t l e n g t h (8', 10', 24', 30', or 35') with an 8' x 8* c r o s s - s e c t i o n ; (2) a d i f f e r e n t c r o s s - s e c t i o n b e i n g 8' x 8'6"; or (3) one of the non-standard U.S. s i z e s . Matson Steamship Company uses van c o n t a i n e r s h a v i n g dimensions o f 8' x 8'6" x 24', and SeaLand Inc. uses c o n t a i n e r s h a v i n g d i n e n s i o n s o f 8' x 8 * x 35'; or (4) one o f the non-standard European Systems which has a width 6 cm. g r e a t e r than the ISO standards o f 8', b e i n g 2.50 meters wide. The members of the Japan 6 L i n e s and American M a i l , and P a c i f i c A u s t r a l i a D i r e c t L i n o s u t i l i z e o n l y ISO standard c o n t a i n e r s i z e s of 20 or 4 0 - f o o t l e n g t h s , while SeaLand uses 35-foot u n i t s . S i n c e the m a j o r i t y of c u r r e n t OCP t r a f f i c o r i g i n a t e s , or i s t r a n s h i p p e d through Japan, o n l y these s i z e s w i l l be d i s c u s s e d i n t h i s paper, with the most emphasis on the 8' x 8' x 20' s i z e . WORLD CONTAINER EVOLUTION AND DEVELOPMENT While t h e r e are r e f e r e n c e s i n the l i t e r a t u r e to c o n t a i n e r s b e f o r e 1900, the f i r s t mention o f a van c o n t a i n e r (18' x 8* x 8') 8 was i n 1 9 H » and some wooden van c o n t a i n e r s were used to handle the overseas shipment of household goods soon a f t e r the 9 t u r n of the century. Denmark has r e p o r t e d l y been u s i n g 10 c o n t a i n e r s s i n c e World War I , and the S o v i e t Union, the U n i t e d Kingdom, and the U n i t e d S t a t e s a l l experimented with 11 van c o n t a i n e r i z a t i o n i n the 1920's and 1930's. However the c u r r e n t concept of the van c o n t a i n e r has o n l y World War, and t h i s was mainly domestic u n t i l the 1960's. (Examples o f some of the types o f c o n t a i n e r s c u r r e n t l y i n use are i l l u s t r a t e d i n Appendix I I I ) A survey of the s h i p p i n g t r a d e j o u r n a l s i n d i c a t e s t h a t deep-sea North American s h i p p e r s and c a r r i e r s d i d not r e a l l y become i n t e r e s t e d i n the use o f van c o n t a i n e r s u n t i l the l a t e 1960's. Even the European and A u s t r a l i a n s h i p p e r s were o n l y a few ye a r s e a r l i e r . In an attempt to reduce the high c o s t s i n v o l v e d i n the t r a n s p o r t a t i o n o f break-bulk cargo, c a r r i e r s have a l s o experimented with the use o f highway t r a i l e r s and c h a s s i s . T h i s l e d to the i n t r o d u c t i o n o f the r o l l - o n / r o l l - o f f ( r o / r o ) 12 c o n t a i n e r v e s s e l s a f t e r World V/ar I I , but the l a t e r use of van c o n t a i n e r s without wheels proved to be more s u c c e s s f u l i n most t r a d e s . The ' c r a d l e ' o f European c o n t a i n e r i z a t i o n was the I r i s h Sea s e r v i c e , i n i t i a t e d between Northern England and Northern I r e l a n d 13 i n the l a t e 19^ 0's. The New South Wales ( A u s t r a l i a ) Government Railway c l a i m s to have p i o n e e r e d the s e a - r o a d - r a i l i n t e r m o d a l movement o f c o n t a i n e r s on a rout e between Tasmania 14 and Sydney. The A l a s k a Steamship Company has used c o n t a i n e r s 15 s i n c e the e a r l y 1950's i n the U.S. domestic t r a d e , while The White Pass and Yukon Steamship Company pionee r e d Canadian 16 i n t e r m o d a l c o n t a i n e r i z a t i o n i n 1955. SeaLand, Inc. has operated a c o n t a i n e r s e r v i c e from the P o r t of New York s i n c e 17 1956, and Matson Steamship L i n e s have been u s i n g c o n t a i n e r 18 s h i p s i n the Hawaiian t r a d e s i n c e 1958. None o f these The deep-sea i n t e r n a t i o n a l c o n t a i n e r trade began i n the mid-1960's, f i r s t on the European-North American t r a d e , and l a t e r on the E u r o p e a n - A u s t r a l i a n r o u t e s . The Japanese o f f i c i a l l y e n t e r e d the c o n t a i n e r 'race' i n October 1968, 19 i n a u g u r a t i n g a weekly s e r v i c e between Japan and C a l i f o r n i a , and a yea r l a t e r s e r v i c e between Japan and A u s t r a l i a was 20 21 begun. The Japanese-Seattle-Vancouver t r a d e began i n 1970. The world-wide movement to c o n t a i n e r i z a t i o n has a c c e l e r a t e d on a l l c o n t i n e n t s , and i s now e v i d e n t i n t r a d e s which had 22 p r e v i o u s l y been c o n s i d e r e d u n s u i t a b l e f o r c o n t a i n e r s . VANCOUVER DEEP-SEA CONTAINER DEVELOPMENT  H i s t o r y C o n t a i n e r s h i p s are not new to the P o r t of Vancouver, alth o u g h the deep-sea i n t e r n a t i o n a l trade i s a r e c e n t development. The White Pass and Yukon Railway Company have operated t h e i r s p e c i a l l y designed c o n t a i n e r v e s s e l s i n the c o a s t a l t r a d e between Vancouver and Skagway s i n c e 1955« The C l i f f o r d J . Rogers s e r v e d u n t i l 1965* when i t was r e p l a c e d by 23 the modern $5 m i l l i o n Frank H. Brown. The f i r s t f u l l y c e l l u l a r deep-sea c o n t a i n e r v e s s e l to c a l l a t the P o r t of Vancouver was the A l e x Johnson on J u l y 18, 1969. However i t was not u n t i l May 30th, 1970, when the Golden Arrow berthed, t h a t the P o r t of Vancouver o f f i c i a l l y j o i n e d the world f r a t e r n i t y o f Deep-Sea C o n t a i n e r P o r t s . The f o u r t y ton g a n t r y crane swung i n t o o p e r a t i o n , and the ' c o n t a i n e r r e v o l u t i o n ' had reached Canada's West Coast. T h i s brought to f o r m a l f r u i t i o n the e f f o r t s of the B r i t i s h Columbia s h i p p i n g i n d u s t r y to persuade The N a t i o n a l Harbour's Board t h a t c o n t a i n e r i z a t i o n was the ' i n t h i n g ' of the 1970's. By t h i s date the NHB had i n v e s t e d $3 m i l l i o n i n p h y s i c a l f a c i l i t i e s , i n c l u d i n g the g a n t r y crane and 12-15 a c r e s of back-up l a n d f o r 26 c o n t a i n e r s t o r a g e ; Empire S t e v e d o r i n g , as the dock o p e r a t o r s , had spent an a d d i t i o n a l $2 m i l l i o n i n o b t a i n i n g c o n t a i n e r h a n d l i n g equipment, i n c l u d i n g three s t r a d d l e c a r r i e r s and a 2? heavy duty f o r k l i f t ; and the Japan 6, a consortium of s i x 28 Japanese steamship companies, and the primary u s e r s of the C e n t e n n i a l P i e r f a c i l i t i e s , had committed themselves to three f u l l y c e l l u l a r c o n t a i n e r s h i p s with an i n i t i a l investment of 29 $30 m i l l i o n . C u r r e n t and Proposed Steamship L i n e S e r v i c e s The s h i p p i n g l i n e s t h a t are p r e s e n t l y moving c o n t a i n e r s to and from Vancouver i n c o n t a i n e r s h i p s are the Japan 6 and Johnson L i n e , with SeaLand and American M a i l L i n e s , S t a t e s L i n e s and some Norwegian f l a g s h i p s sending import cargo v i a 30 S e a t t l e . Many o t h e r l i n e s are moving c o n t a i n e r s on ' c o n v e n t i o n a l ' v e s s e l s as on-deck cargo, or i n s p e c i a l ' s t r e t c h e d * s e c t i o n s . (see Appendix IV . f o r P a r t i a l L i s t i n g o f Steamship L i n e s c a l l i n g a t P o r t of Vancouver) A few c o n t a i n e r s are a l s o a r r i v i n g from Europe v i a Manchester and Canadian P a c i f i c Steamship L i n e s and the Canadian N a t i o n a l and Canadian P a c i f i c Railways. A l l of the Johnson L i n e ' s f u l l y c e l l u l a r c o n t a i n e r v e s s e l s c a r r y t h e i r own cargo h a n d l i n g gear and d i s c h a r g e a t L a P o i n t e P i e r , where the c o n t a i n e r s are handled by Casco T e r m i n a l s . The European L i n e s use the 100-ton cranes a t P i e r 4 & 5 "bo d i s c h a r g e c o n t a i n e r s . On A p r i l 7» 1971, the P a c i f i c A u s t r a l i a D i r e c t L i n e (PAD) i n i t a t e d a complete r o / r o s e r v i c e between Melbourne and the Canadian t e r m i n a l a t the F r a s e r - S u r r e y Docks, wi t h the a r r i v a l 31 of the 20 ,000 dwt Swedish M.S. P a r a l l a . L a t e r t h a t y e a r , the 'K' L i n e of Japan as p a r t of the P a c i f i c Far E a s t (PACFE) s e r v i c e was to b e g i n moving c o n t a i n e r s between Hong Kong, Pusan, Taiwan, and the P a c i f i c Coast o f the U n i t e d S t a t e s as f a r n o r t h as S e a t t l e . A l l of these c o n t a i n e r s were to be on c h a s s i s , with those f o r Canadian d e s t i n a t i o n s expected to be moved by 32 e i t h e r road or piggyback from S e a t t l e to Vancouver. Two o t h e r European c o n t a i n e r s e r v i c e s i n t o the P o r t of Vancouver commenced d u r i n g 1971• Hapag-Lloyd A.G. o f Germany "in a u g u r a t e d a s e m i - c o n t a i n e r f o r t n i g h t l y s e r v i c e between 33 Glasgow and the P a c i f i c North West", while the Blue S t a r L i n e and the E a s t A s i a t i c Company, under'SCANSTAR of London, commenced s e r v i c e i n mid-summer between S c a n d i n a v i a - N o r t h e r n Eurone and the P a c i f i c North West, u s i n g the f i r s t of f o u r 34 c o n t a i n e r v e s s e l s . The p a r t i c i p a n t s i n the Japan 6 L i n e s e r v i c e a l l share the space of each of t h e i r three v e s s e l s , on a 'space c h a r t e r ' * 35 "basis. However, each v e s s e l i s owned by o n l y two of the L i n e s i n p a r t n e r s h i p . The Golden Arrow i s co-owned by the Japan L i n e and the *K' L i n e , and f i r s t e ntered s e r v i c e i n May of 1970. She was f o l l o w e d by the Hotaka Maru (co-owned by the NYK and Shov/a L i n e s ) i n September 1970, and the Beishu Maru (co-owned by M i t s u i OSK and Yamashita. S h i n n i h o n (YS) ) i n October 1970. The f i r s t two v e s s e l s have a c a p a c i t y f o r 750 twenty-foot c o n t a i n e r u n i t s , w h i l e the B e i s h u can c a r r y 1,000 twenty-foot c o n t a i n e r e q u i v a l e n t s . A l l three s h i p s have hook-ups f o r s e r v i c i n g r e f r i g e r a t e d c o n t a i n e r s ( r e e f e r s ) , and a l l can accommodate a number of 4 0 - f o o t dr y and r e e f e r u n i t s . The s h i p s p l y a t h i r t y day round t r i p voyage, with one v e s s e l c a l l i n g a t C e n t e n n i a l P i e r a p p r o x i m a t e l y every 10 days. T r a f f i c has g r a d u a l l y i n c r e a s e d , so t h a t an average o f 300 l o a d e d c o n t a i n e r s are b e i n g d i s c h a r g e d , v/ith a l i k e number of f u l l u n i t s b e i n g p l a c e d on 36 board, a t each c a l l . 'Space c h a r t e r ' as used by the Japan 6 members means t h a t each o f the p a r t i c i p a t i r i g f S t e a m s h i p L i n e s i s e n t i t l e d to the use of o n e - s i x t h o f the a v a i l a b l e space on each v e s s e l . But i n p r a c t i c e the v e s s e l ' s owners seem to r a t e s l i g h t l y more than o n e - s i x t h . I f a p a r t i c u l a r L i n e i s unable to f i l l t h e i r a l l o t e d space, i t w i l l be made a v a i l a b l e to the f i r s t o ther L i n e v/hich asks f o r the use of the empty space on the mutual u n d e r s t a n d i n g t h a t when the c u r r e n t borrower has empty space a v a i l a b l e i n the f u t u r e , the l o a n w i l l be r e p a i d . Advantages Many advantages have been proposed as reasons for the increased trend to containerization, including greater ease of handling; fewer handling operations with less labor and more mechanization; smaller inventories on hand and in transit; fewer opportunities for pilferage; less damage; and (perhaps) a lower price for transportation. These factors have been extensively discussed in the literature, and wil l not be dealt 3 7 with in this study. Unitization, which may be either palletization or containerization, decreases the turnaround time of carrier units (ships, railcars, airplanes and motor carrier flatbeds), and should markedly lower the cost of transportation. The use of containers out of the Port of Freemantle, Australia has been estimated to provide door-to-door savings of up to 38 $5 million (Australian) on interest charges on goods in transit. Whether savings from the latter are passed on to the consignee is not always clear. The majority of the advantages of containerization seem to be involved with time savings through faster, easier, and more desirable delivery procedures. Rees, in commenting on the 1 9 6 ? United Cargo Corporation experiments, noted that "reduction in time has not necessarily resulted in a decrease in total costs. Certainly the development and extension of containerization "promises to f a c i l i t a t e i n t e r n a t i o n a l t r a d e by making p o s s i b l e d i r e c t movements o f c o n t a i n e r l o a d s between i n l a n d s h i p p i n g and 40 r e c e i v i n g p o i n t s " , i n d i f f e r e n t n a t i o n s , and on d i f f e r e n t c o n t i n e n t s . I n some i n s t a n c e s , however, r e a l s a v i n g s from c o n t a i n e r i z a t i o n have been r e a l i z e d as i l l u s t r a t e d by the f o l l o w i n g examples. Some s h i p p e r s c i t e d s a v i n g s of 2$fo i n packaging c o s t s and up to 41 50% i n door-to-door t r a n s i t time. Gen e r a l R e f r a c t o r i e s c l a i m e d t h a t they r e a l i z e d o v e r a l l savings on t h e i r b r i c k 42 shipments even when the c o n t a i n e r was o n l y h a l f f u l l . The Economist d e s c r i b e d the o p e r a t i o n o f an I r i s h company which c h a r t e r e d German c o n t a i n e r s h i p s , used i t s own road haulage f l e e t , and by c a r e f u l l y c o n t r o l l i n g the c o s t , was a b l e to 43 reduce t o t a l c o s t s by 40$. S i m i l a r l y i t was claimed t h a t a $58 m i l l i o n investment i n c o n t a i n e r i z a t i o n by Matson L i n e s produced s a v i n g s such t h a t the t o t a l Hawaii-U.S. Mainland f r e i g h t b i l l f o r 1967 was '$16 to $17 m i l l i o n l e s s than i t would have been without such a s e r v i c e , and t h a t r a t e s were a c t u a l l y 44 lowered. In October 1970 Matson announced t h a t t h e i r two new c o n t a i n e r s h i p s , The Hawaiian P r o g r e s s and the Hawaiian E n t e r p r i s e , were so e f f i c i e n t t h a t "even Matson o f f i c i a l s were s u r p r i s e d by the economies gained..,(and) asked the U.S. ( F e d e r a l ) Maritime Commission to i g n o r e an e a r l i e r r e q u e s t f o r r a t e i n c r e a s e s , because they are p l a n n i n g r e d u c t i o n s i n s t e a d " . 45 In March 1971 t h i s s t a n d was r e v e r s e d and a \2h% i n c r e a s e i n the Mainland to Hawaiian I s l a n d s f r e i g h t r a t e s was requested. Only a 9/5 i n c r e a s e i n t h i s r a t e was g r a n t e d a t t h a t time and h e a r i n g s continued through out the spring months on the j u s t i f i c a t i o n 46 of the remainder of the increase. Problems For the most part lower f r e i g h t rates have not developed, and shippers fear that t h i s has been the r e s u l t of reduced competition as more steamship companies j o i n and act together i n consortia. However the question that should be asked i s whether the steamship conferences r e a l l y had rate competition before containers came into service. The prospect of 9 container ships replacing ten times that number of conventional vessels on the U.K.-New Zealand-Australia Route, or of three container ships replacing 18 vessels i n the Japan-Australia trade r a d i c a l l y changes the problems of 'monopoly* p r i c i n g f o r 47 ocean transport services. Presuming that the ocean c a r r i e r s can, and are r e a l i z i n g savings from containerized operations, shippers want to know why these savings have not been shared (with the shippers, and ultimately with the consumer) through lower price s . "One answer i s that such savings are not r e a l and w i l l not be f o r a long time...(being) more than counter balanced by the expense of 48 changeover to container operations." Five years ago the answer given was that " a l l kinds of savings are being passed onto the shippers... savings i n time, insurance, p i l f e r a g e , and handling costs. With costs...the advantages gained to the shipper and c a r r i e r a l i k e outweigh the disadvantages". 49 Presumably i f f r e i g h t and i n s u r a n c e r a t e s have not been a c t u a l l y lowered, to the extent t h a t these r a t e s have not r i s e n as f a s t , nor as f a r , as might otherwise have been the case, then s a v i n g s from c o n t a i n e r i z a t i o n are b e i n g passed on to the s h i p p e r s , and u l t i m a t e l y to the consumer. Undeniably the appeal of c o n t a i n e r s l i e s i n t h e i r i n t e r m o d a l c h a r a c t e r i s t i c s with the a s s o c i a t e d economies of s c a l e . But to be f u n c t i o n a l l y i n t e r m o d a l r e q u i r e s new ways of t h i n k i n g , and new, or a t l e a s t a l t e r e d investment by the steamship l i n e s , r a i l w a y s , motor c a r r i e r s , and a i r c r a f t companies, a l o n g with a change i n d i s t r i b u t i o n techniques and procedures f o r both the c o n s i g n o r and consignee. In s p i t e of the "remarkable s t r i d e s ( t h a t ) have been taken by water c a r r i e r s on a ' p u l l ' b a s i s " , Robert Howell, w r i t i n g i n D i s t r i b u t i o n Worldwide claims t h a t " s h i p p e r s w i l l have to 'push' to get 50 u n i v e r s a l acceptance of the c o n t a i n e r " . SAVINGS FROM CONTAINERIZATION I t i s p o s s i b l e t h a t many s h i p p e r s accepted c o n t a i n e r i z a t i o n i n i t i a l l y i n the e x p e c t a t i o n t h a t the economies of s c a l e i n h e r e n t i n the system would lower f r e i g h t r a t e s ; thereby making c e r t a i n goods t r a n s p o r t e d i n c o n t a i n e r s more c o m p e t i t i v e than had p r e v i o u s l y been the case. S p e c t a c u l a r savings over c o n v e n t i o n a l break-bulk s h i p p i n g methods were p r e d i c t e d i n I960 i n a paper pr e s e n t e d by D.C. M a c M i l l i a n , P r e s i d e n t of George Sharp Company bef o r e the S o c i e t y of Naval A r c h i t e c t s " u n i t i z e d cargo h a n d l i n g system reduces cargo h a n d l i n g c o s t s 6 5 $ to 8 0 $ . . . a n d p o r t time by more than 8 0 $ . . . (With) fewer s h i p s c r e w and o t h e r o p e r a t i n g c o s t s (are reduced)...up to 3 0 $ . . . ( E v e n though) the c o n t a i n e r s must be bought and p a i d f o r , . . . a n d while a c o n t a i n e r s h i p may c o s t a b i t more, the t o t a l f l e e t c a p i t a l c o s t i s about the same", 51 as f o r c o n v e n t i o n a l s h i p p i n g methods. In a d d i t i o n "contain-e r i z a t i o n of export/import merchandise has l o n g been advocated as a way to reduce the r i s i n g l a b o r c o s t s of l o a d i n g and 52 u n l o a d i n g cargo s h i p s " . The important r o l e t h a t l a b o r can p l a y i n the development and acceptance of c o n t a i n e r i z a t i o n w i l l be d i s c u s s e d i n d e t a i l i n Chapter V. INTERMODAL FREIGHT MOVEMENT C o n t a i n e r i z a t i o n i s r e a l l y the complete i n t e r m o d a l concept of t r a n s p o r t a t i o n . No l o n g e r are the v a r i o u s t r a n s p o r t a t i o n modes competing a g a i n s t each o t h e r , on an i n d i v i d u a l or modal b a s i s ; r a t h e r the n ature of c o m p e t i t i o n now f o r c e s one t o t a l t r a n s p o r t a t i o n network (which may i n v o l v e l a n d , sea, and a i r components), to compete a g a i n s t another complete t r a n s p o r t system, i n v o l v i n g d i f f e r e n t companies (but perhaps the same components). Both networks are competing to move a p a r t i c u l a r shipment of some commodity from A to Z. I n the p a s t o n l y the consignee was r e a l l y concerned w i t h the t o t a l c o s t of the goods i n c l u d i n g t r a n s p o r t a t i o n , but c o n t a i n e r i z a t i o n f o r c e s a l l s e c t o r s of the system to t h i n k i n terms of ' t o t a l c o s t ' i n o r d e r t h a t the "maximum savings (the greatest return on investment) from a p p l i c a t i o n of the u n i t i z a t i o n p r i n c i p l e w i l l be r e a l i z e d from the combination of costs and savings 53 accumulated during the through-movement of the goods". The cost f o r some segments of the t o t a l system may increase; f o r example the sea journey may cost more because of increased vessel operating costs with the f a s t e r , more co s t l y container ships, but the reduction i n o v e r a l l t r a n s i t time and improved < a r r i v a l condition of the cargo provides more than o f f s e t t i n g savings. T r a d i t i o n a l l y cargo has arri v e d i n break-bulk form, been stowed aboard ship by longshore labor, transported to another dock, off-loaded onto that dock, moved into the storage shed by the longshoremen, and subsequently consolidated into r a i l c a r or truck loads. So long as the same procedure i s followed with containers, using the 'box' only f o r the ocean 'leg' of the journey, added costs are being b u i l t into the system, and few of the benefits are being obtained. The t r e n d to c o n t a i n e r s i n world trade i s s u b s t a n t i a l ^ a s p o i n t e d out "by H.A. Mann o f Swan Wooster E n g i n e e r i n g , Vancouver. He s t a t e d t h a t the number o f c o n t a i n e r s i n U.S. f o r e i g n t r a d e i n c r e a s e d from 14,000 i n i960 to 100,000 i n 1968 and " i t i s esti m a t e d t h a t by 1973 more than 800,000 c o n t a i n e r s l o t s w i l l be a v a i l a b l e on the North America-European route a l o n e " . In comparison, the 0ECD est i m a t e d t h a t 1,050,000 c o n t a i n e r s l o t s v/ere a v a i l a b l e by the end of 1970 on the f i v e major t r a d e r o u t e s 55 of the world. RAIL World Developments Not o n l y are the in t e r m o d a l van c o n t a i n e r s expensive,. c o s t i n g from $2,000.00 to $4,500.00 each, but so are the s p e c i a l c o n t a i n e r t r u c k c h a s s i s and r a i l f l a t c a r s and bog i e s . The l a t t e r may c o s t from $17,000 to $20,000 each (which i s more than the c o n v e n t i o n a l f l a t c a r ) , because o f a d d i t i o n a l 57 t e c h n o l o g i c a l d e s i g n problems. The number of u n i t s i s e a s i e r to estimate than i s the t o t a l d o l l a r investment by e i t h e r companies o r n a t i o n s . The 58 Japanese N a t i o n a l Railway, moving ISO vans up to 40 f e e t i n l e n g t h under F r e i g h t A l l Kinds (FAK) r a t e s , p l a n s to have 70 r e g u l a r l y scheduled c o n t a i n e r t r a i n s of 60 f l a t c a r s each o t h e r major c i t i e s , i n c l u d i n g Hokkaido, c u r r e n t l y 18 hours away. P l a n s a re f o r 300 t r a i n s , 18,000 f l a t c a r s , and 200,000 ISO van c o n t a i n e r s to be i n s e r v i c e by 1978. With an investment o f perhaps $1.5 m i l l i o n p e r t r a i n , the p r e s e n t 100 m i l l i o n d o l l a r investment c o u l d e a s i l y become h a l f a b i l l i o n i n t r a i n s alone w i t h i n the next few y e a r s . P r o b a b l y the most famous c o n t a i n e r t r a i n s e r v i c e i s the 59 B r i t i s h F r e i g h t l i n e r , which began s e r v i c e i n November 19&5. 60 C a r r y i n g 400-ton payloads, a t 55 mph, the s e r v i c e p r e s e n t l y connects 25 t e r m i n a l s and 5 p o r t s , over some 80 r o u t e s , and i t i s c o n t i n u a l l y b e i n g expanded. Us i n g u n i t t r a i n s o f permanently coupled 6 2 - f o o t l e n g t h c o n t a i n e r c a r s , F r e i g h t l i n e r s L t d . now own more than s i x thousand 8' x 8' x 20* ISO c o n t a i n e r s , but w i l l a l s o handle s h i p p e r owned c o n t a i n e r s up to 40 f e e t i n l e n g t h . Assuming o n l y one t r a i n per r o u t e , the investment i n f l a t d e c k s and c o n t a i n e r s c o u l d exceed $50 m i l l i o n d o l l a r s . Other European r a i l r o a d s , p a r t i c u l a r l y the German F e d e r a l and French N a t i o n a l R a i l r o a d s , have a l s o moved a g g r e s s i v e l y 61 i n t o the movement of c o n t a i n e r s by r a i l . E s t i m a t e s p l a c e p o s s i b l e investment i n the Munich-Hamburg Li n e a t c $3 b i l l i o n when complete. The French expect to move 25 m i l l i o n tons of cargo by c o n t a i n e r t r a i n w i t h i n the next 10 y e a r s . One problem which a l l European r a i l w a y s f a c e i s t h a t o f many s h o r t - h a u l s , on which the motor c a r r i e r s s hould have a c o m p e t i t i v e advantage. G e n e r a l l y h a u l s o f l e s s than 200 m i l e s can be made more econ-o m i c a l l y by t r u c k s and as complete intermodalness i s accepted, North American c o n t a i n e r movements are e i t h e r (1) L o c a l , and t h e r e f o r e a u t o m a t i c a l l y moved by t r u c k , or (2) Long-haul r a i l movement. The u l t i m a t e scheme would be a two-way l a n d b r i d g e movement from c o a s t to coast or a m o d i f i e d l a n d b r i d g e by u n i t t r a i n s to the i n d u s t r i a l h e a r t l a n d . John G r y g i e l , i n d i s c u s s i n g the Santa Fe R a i l r o a d u n i t t r a i n p r o p o s a l f o r l a n d b r i d g e t r a f f i c between Japan and Europe, i n d i c a t e d t h a t a minimum o f h a l f a 62 m i l l i o n tons of cargo would move i n each d i r e c t i o n a n n u a l l y . The Santa Fe p r o p o s a l s c a l l e d f o r an 80-car, 320-container t r a i n , moving 3»000 tons each way every f i v e days. One hundred and s i x t y of these u n i t t r a i n s would be r e q u i r e d , n e c e s s i t a t i n g an investment of 300 to 500 m i l l i o n d o l l a r s f o r t h i s i m p o r t / export t r a f f i c a l o n e . Canadian Experience While the major Canadian r a i l w a y s are j u s t commencing c o n t a i n e r movement, Canadian experience i n t h i s a r e a o f endeavor i s f a r from l a c k i n g . The White Pass and Yukon Railway have been moving c o n t a i n e r s from Skagway to Whitehorse over 63 t h e i r 110 m i l e narrow guage r a i l r o a d s i n c e 1955. The two major Canadian r a i l r o a d s have r e c e n t l y ordered an a d d i t i o n a l 400 c o n t a i n e r bogies ( c o s t i n g over $8 m i l l i o n ) to supplement t h e i r c u r r e n t f l e e t s o f 1,200 c o n t a i n e r - c a r r y i n g f l a t c a r s . Both the CNR and the CPR have i n t e g r a t e d i n t e r m o d a l c o n t a i n e r systems o p e r a t i n g from the t e r m i n a l s o f H a l i f a x - S t . John and Quebec C i t y r e s p e c t i v e l y f o r the T o r o n t o - M o n t r e a l - D e t r o i t -Chicago t r a f f i c , but n e i t h e r r a i l w a y has i n s t i t u t e d a s i m i l a r setup f o r Western Canada. The Canadian N a t i o n a l Railway a c t u a l l y moved i n t o 64 c o n t a i n e r s l a t e i n 1967» although they had had s e v e r a l years a s s o c i a t i o n with the concept and had even moved some 'boxes' 65 p r e v i o u s l y . The Canadian P a c i f i c has had experience with ISO 20-foot c o n t a i n e r s s i n c e 1964, but i t d i d not r e a l l y get i n t o 66 the movement of van c o n t a i n e r s u n t i l 19&9. Both the CNR and CPR s t a r t e d t h e i r c o n t a i n e r movements by c o n v e r t i n g s u r p l u s r o l l i n g s t o c k i n t o c o n t a i n e r f l a t s , and by p l a c i n g c o n t a i n e r s 6?, d i r e c t l y on o r d i n a r y f l a t c a r s . Late i n 1970, the Canadian P a c i f i c o r d e r e d an a d d i t i o n a l two hundred, 100-ton, 85-foot f l a t c a r s ($4 m i l l i o n ) to supplement t h e i r c u r r e n t 154 c o n t a i n e r 68 f l a t c a r f l e e t , w h i le Canadian N a t i o n a l ordered 235 85-foot 69 f l a t c a r s . These c a r s w i l l handle f o u r 20-foot c o n t a i n e r s , two 4 0-footers, or a combination of the two l e n g t h s . The CNR has experimented with a center-sagged c o n t a i n e r c a r capable o f 70 c a r r y i n g 6 c o n t a i n e r s , and c o s t i n g perhaps $25,000. The f i r s t use of t h i s c a r , which c a r r i e s c o n t a i n e r s s t a c k e d two u n i t s h i g h on the low-slung c e n t e r s e c t i o n between the t r u c k s , 71 was i n May 1971- out of H a l i f a x . A p a r t i a l l i s t i n g of the equipment used by the Canadian Railways f o r the movement of c o n t a i n e r i z e d cargo i n c l u d e s * 1.115 express c o n t a i n e r s (8' x 8' x 20'); 923 c o n t a i n e r f l a t c a r s . 72 CPR - 273 u n i t s i n c l u d i n g twenty 20-foot CP R a i l C o n t a i n e r s . VESSEL AND PORT EFFICIENCY As f a r as the s h i p i s concerned, c o n t a i n e r i z a t i o n i s merely the t r a n s f o r m a t i o n o f break-bulk cargo i n t o s t a n d a r d i z e d b u l k p a r c e l s . I n world t r a d e , e s t i m a t e s are t h a t 90% to 95?$ of 73 g e n e r a l cargo i s c o n t a i n e r i z a b l e , although t h i s percentage may not n e c e s s a r i l y be e c o n o m i c a l l y c o n t a i n e r i z a b l e . Some c u r r e n t e s t i m a t e s suggest t h a t world g e n e r a l cargo tonnage w i l l i n c r e a s e (from 200 m i l l i o n tons i n 1966) a t a r a t e of 5z?° -per y e a r u n t i l 1975* and then by 5$ - u n t i l I98O, with t o t a l tonnage of between 375 m i l l i o n and 51° m i l l i o n tons by 74 t h a t y e a r . Dr. J . Tinbergen, speaking b e f o r e the I n t e r n a t i o n a l  Symposium on Middleterm and Longterm F o r e c a s t i n g f o r S h i p - b u i l d i n g and S h i p p i n g i n June 1970 a t The Hague observed t h a t "between 1950 and 1968 the e f f i c i e n c y of the world merchant marine doubled. Replacement of t r a d i t i o n a l s h i p s by c o n t a i n e r s almost i m p l i e d d o u b l i n g e f f i c i e n c y f o r each u n i t r e p l a c e d . " 75 Research d a t a p r e s e n t e d l a t e r i n the same conference by H.J. Molenaar was t h a t one c o n t a i n e r s h i p c o u l d s u b s t i t u t e f o r 3 to 6 c o n v e n t i o n a l v e s s e l s , p a r t l y because of i n c r e a s e d s i z e , but p r i m a r i l y due to the g r e a t e r number of round t r i p voyages from c o n t a i n e r i z a t i o n , but suggested t h a t i f the r e s e a r c h e r s had had knowledge of the, a t p r e s e n t , u n d i s c l o s e d l o a d f a c t o r s f o r both c o n v e n t i o n a l v e s s e l s and c o n t a i n e r s h i p s , a narrower and more meaningful range c o u l d be obt a i n e d . He summed up the p o i n t by s u g g e s t i n g " i f average v e s s e l s i z e ( i n deadweight tons) would double f o r c o n t a i n e r v e s s e l s , one c o n t a i n e r v e s s e l c o u l d do the work o f 2.7 to 4.8 c o n v e n t i o n a l v e s s e l s " , a 270$ to 480$ 77 p r o d u c t i v i t y i n c r e a s e . These f i n d i n g s support McKinsey's 78 I967 p r o j e c t i o n s , (see F i g . 1.1^p. 3) and they are b e i n g borne out by p r a c t i c a l e x p e r i e n c e . P o r t and Route R a t i o n a l i z a t i o n One o f the r e s u l t s o f t h i s e f f i c i e n c y a l t e r a t i o n i s t h a t the move to c o n t a i n e r i z a t i o n e f f e c t i v e l y i n c r e a s e s a g i v e n p o r t ' s h i n t e r l a n d , as time becomes more important than d i s t a n c e . T h i s must e v e n t u a l l y r e s u l t i n a decrease i n the number of p o r t s . In the p a s t , i t was found t h a t any p a r t i c u l a r p o r t drew i t s t r a f f i c m ainly from a. f a i r l y s m a l l and d i s t i n c t g e o g r a p h i c a l a r e a . However wit h the advent of f u l l i n t e r m o d a l c o n t a i n e r i z - '.  a t i o n , the c o n t a i n e r i z e d p o r t must operate i n c o n j u n c t i o n with i n l a n d t e r m i n a l s , and the d i s t i n c t p o r t h i n t e r l a n d s , as observed 79 80 81 i n B r i t a i n , the U n i t e d S t a t e s , and Canada, become much l e s s important. Tanner and W i l l i a m s noted t h a t i t would be p o s s i b l e to c o n c e n t r a t e 85$ of B r i t i s h - A u s t r a l i a n g e n e r a l were so i n c l i n e d , but they q u e s t i o n whether such a move would 82 be wise i n the l o n g run. I t a l s o seems e n t i r e l y p o s s i b l e t h a t the Canadian Government c o u l d have chosen one E a s t Coast p o r t , e i t h e r H a l i f a x , M.S.; or S t . John, N.B.; and then e f f e c t i v e l y have prevented a l l o t h e r s , i n c l u d i n g M o n t r e a l , Quebec C i t y , and Toronto from even s t a r t i n g a deep-sea c o n t a i n e r t e r m i n a l . As i t i s , c o n t a i n e r s e r v i c e s to and from the Great Lakes p o r t s are "no l o n g e r p r o f i t a b l e f o r most North A t l a n t i c f r e i g h t l i n e s . . . i n c o m p e t i t i o n w i t h c o n t a i n e r s h i p s which unlo a d t h e i r 83 cargoes a t New York or Montreal". I t i s not y e t c l e a r whether a government decree o f o n l y one deep-sea c o n t a i n e r p o r t would have been the b e s t f o r Canada i n the l o n g term, but i t i s a d i s t i n c t p o s s i b i l i t y . With the r a p i d 20 and 30 hour t r a i n s to Montreal and Toronto from H a l i f a x , the h i n t e r l a n d s o f a l l o f Canada's E a s t e r n c i t i e s have become merged. A p p a r e n t l y the Japan 6 decided t h a t s u f f i c i e n t d i f f e r e n c e s d i d e x i s t between Vancouver and S e a t t l e to j u s t i f y two p o r t s of c a l l , but t h a t those goods which might move through P o r t l a n d , c o u l d be more e c o n o m i c a l l y moved o v e r l a n d to e i t h e r Oakland or S e a t t l e , However f o l l o w i n g the U.S. F e d e r a l Maritime Commission (FMC) r u l i n g i n l a t e 1970 (which r e q u i r e d t h a t v e s s e l s c a l l i n g a t S e a t t l e a l s o c a l l a t P o r t l a n d ) , the Japanese v e s s e l s began c a l l i n g a t S e a t t l e and Vancouver, i n t h a t order, on every voyage, f o l l o w e d by a d i v e r s i o n to P o r t l a n d every o t h e r t r i p . m a r g i n a l p r o f i t a b i l i t y . ECONOMICS OF CONTAINER!ZATION FOR VESSELS COSTS IN OCEAN TRANSPORTATION Costs i n ocean t r a n s p o r t a t i o n are s i m i l a r to c o s t s i n ot h e r t r a n s p o r t a t i o n modes, with the u s u a l economic d i s t i n c t i o n between l o n g and s h o r t run c o s t s . The e x c e p t i o n , as Bennathan and W a l t e r s note, i s t h a t "ocean t r a n s p o r t a t i o n i s e a s i e r to d e a l w i t h , because there are no ' t r a c k c o s t s ' as i n the case of 86 road and r a i l " . In the s h o r t run, the supply o f v e s s e l tonnage i s r e l a t i v e l y i n e l a s t i c a t the p o i n t a t which a l l a v a i l a b l e tonnage i s i n use. More tonnage can be ob t a i n e d o n l y by the r e a c t i v a t i o n o f l a i d - u p s h i p s or by the use o f v e s s e l s designed f o r some o t h e r f u n c t i o n . The l a t t e r has been the method by which, c o n t a i n e r i z a t i o n became e s t a b l i s h e d , i . e . c a r r y i n g c o n t a i n e r s on the decks of f r e i g h t e r s . D u r i n g 19?0 the s u p p l y o f pure c o n t a i n e r v e s s e l s and c o n t a i n e r c a p a c i t y seemed to have o u t s t r i p p e d demand, and an o v e r c a p a c i t y s i t u a t i o n was emerging on the main A t l a n t i c and P a c i f i c r o u t e s . No major r a t e war had o f f i c i a l l y appeared, but a severe t e s t o f the conference method of s h i p p i n g appeared 8? i n e v i t a b l e , as companies e v a l u a t e d t h e i r v e s s e l i n v e n t o r i e s and ro u t e s t r e n g t h s and weaknesses. As e a r l y as J u l y 1970, rumors of a severe r a t e war on the A t l a n t i c began a p p e a r i n g i n the p r e s s . Charges t h a t m a l p r a c t i c e s w i t h i n the S h i p p i n g Conferences, such as r e b a t i n g , were not b e i n g c o n t r o l l e d , r e p o r t e d l y l e d the A t l a n t i c 89 C o n t a i n e r L i n e to withdraw from a westbound conference. A l s o , the low r a t e quoted on shipments of U.S. m i l i t a r y cargo wss c o n s i d e r e d to be c o n t r i b u i t i n g d i r e c t l y to trade 90 r o u t e i n s t a b i l i t y . Cargo Stov-T- 9~e The dimensions of s h i p cargo stowage are weight, c u b i c c a p a c i t y , d i s t a n c e , and time. A p a r t i c u l a r combination of "these f a c t o r s occurs f o r each voyage f o r any g i v e n v e s s e l . These f a c t o r s are extremely important i n s h i p p i n g economics...A q u i c k look a t the s t a t i s t i c s of the world's tonnage and the world's trade might g i v e the i m p r e s s i o n t h a t s h i p p i n g as a whole uses l e s s than 30 p e r c e n t o f i t s c a p a c i t y on average... S p e c i a l problems of one-way t r a d e s and the "peak" p r o b l e m . . . e x p l a i n why s h i p p i n g space must always be o n l y p a r t l y used". 91 In the b u l k t r a d e s , and to some exte n t i n dry cargo, a s h i p may have to shut out cargo when space i s s t i l l a v a i l a b l e , because the weight has lowered the v e s s e l to i t s 'marks'. T h i s does not seem to be any problem with c o n t a i n e r i z e d cargoes, a t l e a s t not f o r much of the c u r r e n t l y c o n t a i n e r i z e d commodities because of the r e l a t i v e l y low weights per 92 c o n t a i n e r . In c a l c u l a t i n g stowage f a c t o r s "bulk i s expressed i n measurement tons of 40 c u b i c f e e t , and weight g e n e r a l l y i n l o n g t o n s . . . I f the stowage f a c t o r i s s a i d to equal one, i t means t h a t a c u b i c ton of t h a t commodity weighs one ton...a cargo with a high stowage f a c t o r w i l l r e q u i r e more than 40 c u b i c f e e t of space, .'.a low stowage w i l l r e q u i r e l e s s than 40 c u b i c f e e t to stow a weight ton". ' 93 However, s i n c e both weight and c u b i c volume are l i m i t i n g f a c t o r s i n s h i p p i n g , f r e i g h t r a t e s are u s u a l l y e s t a b l i s h e d on the l a r g e r of e i t h e r a ton-weight, or a ton-measurement b a s i s , a b a s i s which the r a i l w a y s r e f e r to as 'revenue tons'. S h i p Tonnage Measures Ship c a p a c i t y i s u s u a l l y quoted i n any or a l l o f the f o l l o w i n g measures: (1) Gross r e g i s t e r e d tonnage ( g r t ) ; e q u a l l i n g the number of 100 c u b i c f o o t 'tons' of e n c l o s e d space. (2) Net r e g i s t e r e d tonnage ( n r t ) ; b e i n g g r t l e s s c e r t a i n n o n - productive p a r t s of the v e s s e l . (3) Deadweight tonnage (dwt); b e i n g the t o t a l weight of cargo, bunkers, and p r o v i s i o n s , i n c l u d i n g water, 95 which w i l l lower the v e s s e l to her 'marks'. While t h e r e i s no c o n s i s t a n t r e l a t i o n s h i p between these measures, C u l f e y suggests a ' r u l e of thumb' i s t h a t 96 g r t = 2/3 of dwt, and n r t = 2/5 o f the dwt. Thus the net r e g i s t e r e d tonnage i s o n l y a rough guide to the volume of cargo t h a t a s h i p may c a r r y when space i s the l i m i t i n g f a c t o r C e r t a i n adjustments must be made, s i n c e "the c u b i c c a p a c i t y of s h i p s i s measured i n a ton-measurement of 100 c u b i c f e e t , 97 not 40 c u b i c f e e t as are cargo tons". A b e t t e r measure of c a r r y i n g c a p a c i t y i s the g r a i n  stowage f o r b u l k cargo; b a l e stowage, f o r cargo i n uniform b a l e s ; or broken stowage f a c t o r (a 10$ r e d u c t i o n i n the b a l e stowage f a c t o r ) to account f o r the many s i z e s and shapes of g e n e r a l break-hulk cargoes. I n s u l a t i o n or r e f r i g e r a t i o n equipment would f u r t h e r reduce usable c a p a c i t y . On balance, i t would seem t h a t c o n t a i n e r s h i p c a p a c i t y would be somewhat l e s s than b a l e stowage below decks, with a more than compen-s a t i n g f a c t o r f o r above-deck c o n t a i n e r space. As a r e s u l t , the A s s o c i a t e d C o n t a i n e r L i n e ' s (ACL) " f i r s t g e n e r a t i o n c o n t a i n e r s h i p s h a v i n g a dead weight c a p a c i t y o f 14,000 tons... e q u i v a l e n t i n cargo c a p a c i t y to an o l d e r s t y l e 35»000 dwt 98 break-bulk v e s s e l " , were p r o b a b l y f a i r l y t y p i c a l of the space e f f i c i e n c y o f c o n t a i n e r s h i p s . However the high c u b i c f a c t o r s of much c o n t a i n e r i z e d cargo negates some of the space advantages. Even when the c o n t a i n e r v e s s e l has every c e l l f i l l e d , the h i g h broken stowage f a c t o r s i n s i d e the i n d i v i d u a l c o n t a i n e r s i n d i c a t e poor space u t i l i z a t i o n . REPRESENTATIVE INVESTMENT IN CONTAINER VESSELS C u r r e n t and Future, Trends The move to world-wide c o n t a i n e r i z a t i o n i s an expensive one f o r a l l concerned. Depending on s i z e , the i n i t i a l c o s t of a new deep-sea a l l - c o n t a i n e r c e l l u l a r s h i p may range from $7 m i l l i o n to over $15 m i l l i o n . R e c e n t l y SeaLand S e r v i c e Inc., p l a c e d a $160 m i l l i o n o r d e r f o r f i v e new, 33 knot v e s s e l s , each 980 f e e t l o n g and capable of c a r r y i n g 1,050 of the s h i p s c u r r e n t l y i n use on many of the s h o r t e r deep-sea r o u t e s c a r r y a p r i c e tag of $8 to $10 m i l l i o n each. Even a s h i p c o n v e r s i o n can i n v o l v e an investment of between $2 and 100 $9 m i l l i o n . In b u l k commodities the development of i n c r e a s i n g l y l a r g e r bulk c a r r i e r s has been the road to lower c o s t s . T h i s move was p r a c t i c a l l y f o r c e d upon tanker and 'obo* v e s s e l owners by the c l o s i n g of the Suez Canal. The f i r s t 100,000 dwt bulk c a r r i e r was launched i n 1966, but by 19&9» 150,000 and 200,000 dwt obo c a r r i e r s were i n o p e r a t i o n , w hile one of 101 300,000 dwt was on the p l a n n i n g boards. New tanke r s approaching 500,000 tons are now bei n g planned. The t r e n d to l a r g e r and f a s t e r c o n t a i n e r s h i p s c a r r y i n g 1,200 to 1,5°0 c o n t a i n e r s , i s a l s o e v i d e n t . w i t h Dart L i n e s o b t a i n i n g 23 knot, 102 23,000 dwt v e s s e l s , and SeaLand Inc. t u r n i n g to 33 knot 103 v e s s e l s . E s s e n t i a l l y c o n t a i n e r i z e d cargo i s as homogeneous as t h a t of o i l and bulk t a n k e r s , because the 'boxes* are a l l the same shape and of uni f o r m s i z e f o r a gi v e n v e s s e l . P r o f e s s o r A. Couper, i n an i n a u g u r a l l e c t u r e a t the U n i v e r s i t y o f Wales I n s t i t u t e of S c i e n c e and Technology, suggested t h a t even f o r s m a l l 3»000 - 5»000 ton q u a n t i t i e s , i t may be more economical to b u l k and s h i p by s p e c i a l i z e d c a r r i e r , than to use p a r c e l s i n cargo l i n e r s . As a r e s u l t more companies w i l l adopt a " t r a n s p o r t i n t e n s i v e p o l i c y (by) moving semi-processed m a t e r i a l s 104 w i d e l y between p l a n t s i n d i f f e r e n t c o u n t r i e s " . As c o n t a i n e r i z a t i o n becomes f u l l y accepted, the speed and s a f e t y of t r a n s p o r t a t i o n w i l l so broaden the market t h a t " f a c t o r s l i k e l a b o r c o s t s and a v a i l a b i l i t y of raw m a t e r i a l s may prove d e c i s i v e " i n the choosing of s i t e s f o r new p l a n t s . P r o f e s s o r S.G. Sturmey p o i n t s out t h a t the c e l l u l a r c o n t a i n e r s h i p i s one s p e c i a l i z e d c a r r i e r which does not have to t r a v e l one way i n b a l l a s t , because i t has a p a y l o a d 106 a v a i l a b l e a t each end of i t s r o u t e . C u r r e n t l y U.S. F l a g s h i p s dominate both the A t l a n t i c and P a c i f i c t r a de r o u t e s and 107 are f i l l i n g over 80% of t h e i r a v a i l a b l e c o n t a i n e r s l o t s . With the i n t r o d u c t i o n o f t h e i r three new c o n t a i n e r v e s s e l s , the Canadian P a c i f i c Steamship Company expects to obtain' 90% u t i l i z a t i o n on the Europe to Canada run with 84?& u t i l i z a t i o n 108 on the r e t u r n t r i p . The Japan 6 were o b t a i n i n g over 70% u t i l i z a t i o n of t h e i r c o n t a i n e r s l o t s a f t e r l e s s than a year of 109 o p e r a t i o n to the P a c i f i c North-West. The North A t l a n t i c t r a de s i n c e 1966 has p r o g r e s s e d from " m o d i f i e d T-2 tankers and C-4 cargo s h i p s . . . t h r o u g h . . . combination c a r r i e r s to the f u l l y c e l l u l a r a l l c o n t a i n e r 110 s h i p " . S h i p s now coming i n t o o p e r a t i o n , under c o n s t r u c t i o n , or planned can and/or w i l l accomodate any of the 20, 35» or 4 0 - f o o t van c o n t a i n e r s , wheeled 'boxes', or a wide v a r i e t y of 111 cargo shapes and s i z e s . Matson, i n 1970, launched two c e l l u l a r c o n t a i n e r s h i p s i n the Hawaiian-San F r a n c i s c o trade which are a b l e to handle any l e n g t h c o n t a i n e r by adjustment of 112 the guide r a i l s . While the s e m i - c o n t a i n e r s h i p seems to have l o s t f a v o r with many of the major c o n t a i n e r l i n e s , s h i p s each h a n d l i n g 1,100 c o n t a i n e r s and 4,000 tons o f c o n v e n t i o n a l cargo. Most l i n e s d e s i r i n g v e r s a t i l i t y p r e f e r the combination r o / r o - l o / l o v e s s e l s p e r m i t t i n g simultaneous l o a d i n g and d i s c h a r g e o f c o n t a i n e r s from v e r t i c a l c e l l s , and 113 ' r o l l i n g ' cargo from s t e r n o r s i d e p o r t s . S h i p s p l y i n g the s h o r t - s e a h a u l r o u t e s of Europe, or the U.S. West Indies,have tended to be completely r o / r o , p e r m i t t i n g f a s t l o a d i n g and un l o a d i n g o f wheeled v e h i c l e s , and thereby e f f e c t i n g a f a s t 114 p o r t turnaround o f s h i p s , c o n t a i n e r s , and t r u c k s . World C o n t a i n e r F l e e t In a d d i t i o n to a world o p e r a t i o n a l f l e e t o f about 300 p a r t i a l l y o r f u l l y c o n t a i n e r i z e d s h i p s c a r r y i n g 104,000 115 c o n t a i n e r s , by October 1970 an a d d i t i o n a l 145 new c o n t a i n e r v e s s e l s were under c o n s t r u c t i o n or planned, b r i n g i n g c a r r y i n g 116 c a p a c i t y to over 175*000 c o n t a i n e r s . By the end of January 117 1971 the number of c o n t a i n e r s h i p s on or d e r had r i s e n to 221, and amounted to 1/3 o f the t o t a l g e n e r a l cargo tonnage on 118 order, with an average s i z e of 19,235 dwt (see Table 2.1). F i f t y s i x o f these v e s s e l s had a tonnage i n excess o f 25,000 dwt. The most s i g n i f i c a n t a l t e r a t i o n was i n the p o s i t i o n of the USSR, which p l a c e d 17 of t h e i r 18 c o n t a i n e r s h i p orders i n the l a s t q u a r t e r o f 1970. Nine v e s s e l s were a l l - c o n t a i n e r , the oth e r s 119 were p a r t - c o n t a i n e r s . P r e s e n t f o r e c a s t s are f o r more than 700. ( p a r t or f u l l ) CONTAINER SHIPS ON ORDER January 31, 1971. Flae #of Vessels Tons dw Ave. tons U.K. U.S. 41 38 1,038,210 733,^04 25,322 20,352 West Germany France 37 15 578,5^5 245,400 15,636 16,360 USSR Japan 18 7 220,000 212,800 12,222 30,400 Holland Liberia 8 8 208,000 158,980 26,000 19.872 Greece Sweden 8 9 130,420 114,970 16,302 12,77^ Denmark Others* 5 27 105,000 464,800 21,100 17,215 Total 221 4', 251,029 19,235 * Only Flags which had over 100,000 dwt on order are shown separately. Source: , "Order Books Grow Even Faster; Massive Increase in Bulk Carrier Contracts", Fairplay  International Shipping Journal. February 25, 1971. pp. 27-28. 370,000 c o n t a i n e r s . The net e f f e c t of t h i s r a p i d growth has been t h a t the warnings o f gross o v e r - c a p a c i t y i n the world 121 c o n t a i n e r i z e d t r a d e , made as e a r l y as 19&7, are now p r o v i n g to be t r u e . The i n e v i t a b l e r e s u l t has been c o n s o l i d a t i o n or 122 withdrawal of some companies, the f o r m a t i o n of new conferences, 123 and even the implementation of a new r a t e s t r u c t u r e . However i t must be remembered t h a t o v e r - c a p a c i t y i n 1970 does not a u t o m a t i c a l l y r e s u l t i n o v e r - c a p a c i t y f o r 1972. I d e a l C o n t a i n e r S h i p S i z e The q u e s t i o n of the i d e a l s i z e f o r a c o n t a i n e r ' s h i p ' on l a n d , sea, or a i r has not y e t been answered. Presumably t h e r e i s a f i n i t e s i z e to o b t a i n maximum economy, but whether t h i s i d e a l s i z e w i l l be determined by s h i p o p e r a t i o n c o s t s , by p o r t h a n d l i n g f a c i l i t i e s , o r by l a n d c o n t a i n e r movements i s not c l e a r . One a r t i c l e i n a r e c e n t i s s u e of F a i r p l a y suggests t h a t e n g i n e e r i n g problems and p r e s e n t f a c i l i t i e s w i l l l i m i t c o n t a i n e r s h i p s to the s i z e of the c u r r e n t t h i r d g e n e r a t i o n c o n t a i n e r 124 v e s s e l s . The author s t a t e s t h a t the problem of i n c r e a s e d speed, with the r e s u l t i n g i n c r e a s e d f u e l requirements, a l o n g with a decrease i n the l o a d / u n l o a d time f o r a 3 »000-container s h i p to 12 hours means t h a t the maximum f u t u r e s i z e of c o n t a i n e r v e s s e l s i s l i k e l y to be about 5»000 40 - f o o t 125 e q u i v a l e n t s . The Geometric Ram Bow f e a t u r e d i n the 3 new 126 Canadian P a c i f i c 16,000 dwt c o n t a i n e r s h i p s , has been the ways of a t t a i n i n g h i g h e r speeds i s p r o c e e d i n g . Whether t h i s 12? w i l l be accomplished by n u c l e a r powered v e s s e l s , or j e t 128 p r o p u l s i o n , i s y e t to be decided. The K a r l s t a d s Mekaniska Werkstad Co. i s " f i r m l y convinced t h a t the n o z z e l w i l l r e p l a c e the o r d i n a r y p r o p e l l e r . . . ( b e c a u s e ) j e t p r o p u l s i o n can compete wit h p r o p e l l e r p r o p u l s i o n a t speeds i n excess of 35 knots and v e r y h i g h r a t e s of engine power, as i n the case of l a r g e c o n t a i n e r s h i p s " . 129 However the t r e n d s i n movement o f cargo by a i r may a l s o become a v e r y important f a c t o r i n l i m i t i n g v e s s e l s i z e and numbers i n the f u t u r e . C o n t a i n e r Systems of the Future One of the new systems d e v e l o p i n g from the t r e n d to c o n t a i n e r i z a t i o n has been the concept of LASH ( L i g h t e r Aboard SHip) and 'Seabee' v e s s e l s which are now coming i n t o o p e r a t i o n . T h e i r major advantage i s t h a t barges can be loaded a t i n l a n d waterway p o r t s i n a c c e s s i b l e to ocean g o i n g v e s s e l s and towed to the ocean p o r t , or the ship- anchored i n the harbour. L o u i s F i o r e , P r e s i d e n t of the Ohio R i v e r Co., which i s managing the U.S. r i v e r t r a n s p o r t a t i o n f o r LASH, s t a t e s t h a t "the new system w i l l r e s u l t i n g r e a t e r speed and e f f i c i e n c y we w i l l be a b l e to e l i m i n a t e c o s t l y p o r t time, which today sees s h i p s spending as much as 25% to 35% of t h e i r time i n a p o r t w a i t i n g f o r u n l o a d i n g or d ocking f a c i l i t i e s . We w i l l be a b l e to e l i m i n a t e the need f o r e x p o r t e r s to make l a r g e , c a p i t a l e x p e n d i t u r e s f o r warehouses and dock f a c i l i t i e s a t p o r t s of e n t r y . With LASH there i s no need f o r these h o l d i n g f a c i l i t i e s . Savings w i l l a l s o come from the fewer The A c a d i a F o r e s t , a LASH type v e s s e l of 43,000 dwt c a p a c i t y , c a r r i e s 73 l i g h t e r s , l i f t e d on and o f f the boat by 131 a 510 ton g a n t r y crane. Each one i s 6 l ' x 31' x 13', and c o n t a i n s 20,000 c u b i c f e e t of b a l e c a p a c i t y , e q u i v a l e n t to 20 c o n t a i n e r s . T h i s v e s s e l , owned by the C e n t r a l G u l f Steamship Company, t r a v e l s a t 18 knots, and r e q u i r e s 15 minutes f o r a l o a d / u n l o a d c y c l e of a l i g h t e r . T o t a l l i g h t e r s upply i s 233. Of note, i s t h a t the P o r t of San F r a n c i s c o i s c u r r e n t l y b u i l d i n g a $21 m i l l i o n LASH t e r m i n a l , the world's f i r s t , to 132 open i n l a t e 1971. A l s o a t the c u r r e n t time, the f i r s t o f three 'Seabees' i s under c o n s t r u c t i o n i n Quincy, Mass. f o r Lykes Bros. Steamship Co. o f New O r l e a n s . "The l a r g e s t cargo t r a n s p o r t s h i p i n the world, the v e s s e l w i l l be 875 f e e t l o n g and 106 f e e t wide. I t w i l l c a r r y 38 f u l l y - l o a d e d barges c o n t a i n i n g a t o t a l of 24,500 l o n g tons o f cargo." 133 These three r e v o l u t i o n a r y barge and i n t e r m o d a l c a r r i e r s "have a t o t a l c a p a c i t y of 4800 c o n t a i n e r s o r the e q u i v a l e n t o f 4^ m i l l i o n c u b i c f e e t of cargo space. And when cargo stowage p e r m i t s , the s h i p s can c a r r y as much as 15,000 tons of l i q u i d cargo i n t h e i r deep t a n k s . . . I n d i v i d u a l c o s t of each of the th r e e Seabee c l a s s g i a n t s b u i l d i n g a t Gene r a l Dynamics i s $37,000,000 which i n c l u d e s a c o s t of $5,000,000 f o r barges to s e r v i c e each s h i p " . 134 With a steam power p l a n t of 36,000 shp the 'Seabees' w i l l 135 a t t a i n a speed of 20 knots. The LASH and Seabee concept i s an expensive, but a p p a r e n t l y an e c o n o m i c a l l y v i a b l e a l t e r n a t i v e to the a l l -container vessel. Whether th i s i s the future trend of un i t i z e d general cargo movement i s unknown, but some authors, and a few steamship companies appear convinced that t h i s i s the method by which cargo w i l l be moved by the mid 1970's. CONTAINERSHIP OPERATING COSTS General Factors The costs of operating a vessel f a l l c h i e f l y into either terminal costs or t r a n s i t costs; the former being incurred at both ends of the voyage regardless of i t s length, and the l a t t e r being d i r e c t l y r e l a t e d to the distance between ports of c a l l . Containerships are operated on r e g u l a r l y scheduled routes, with a l i m i t e d number of port c a l l s at each end of the ocean voyage. Because the d i v i s i o n of ocean voyage and port costs i s , to a large degree, simply a matter of an accounting a l l o c a t i o n , the rates charged are pri m a r i l y a matter of 'what the t r a f f i c w i l l bear'. Factors such as port congestion, f a c i l i t i e s a v a i l a b l e , or labor p r o d u c t i v i t y may be considered in 'costing the service', but b a s i c a l l y rates are value of service, not cost, oriented. In theory, as the number of container spaces available on a p a r t i c u l a r route i s increased, competition should force the prices being charged to decrease. This should then be followed by a process of consolidation and r a t i o n a l i z a t i o n of the avai l a b l e space. In pr a c t i c e , the very high costs of entry i n t o a c o n t a i n e r i z e d r o u t e ' s trade has produced the mergers ( i n t o c o n s o r t i a ) f i r s t , and as y e t no l a r g e - s c a l e r a t e wars have developed, e i t h e r i n s i d e or o u t s i d e the conferences, although 'grumblings' abound. The s i n g l e most important f a c t o r i n the ' c o s t ' of o p e r a t i n g a break-bulk c a r g o - l i n e r i s the c o s t of s h i p board 136 l a b o r , f o l l o w e d by d e p r e c i a t i o n , as i l l u s t r a t e d by the summary of c o s t s f o r o p e r a t i n g break-bulk cargo s h i p s shown i n Table 2.2. TABLE 2.2 OPERATING COSTS OF BREAK-BULK CARGO SHIPS D e p r e c i a t i o n 17$ Crew Costs 25$ R e p a i r s and Maintenance.' 14$ Insurance 8$ Management 7$ F u e l 7$ P o r t Costs 7$ Other V e s s e l Costs 5^ T o t a l 100$ Source: C. O'Loughlin, The Economics of Sea T r a n s p o r t . Pergamon P r e s s . Toronto. 1967. p~! 116. s t r u c t u r e of c o s t s f o r ocean going break-bulk cargo v e s s e l s , O'Loughlin noted t h a t i t was " d i f f i c u l t to d i s t i n g u i s h between r o u t i n e maintainence and e x c e p t i o n a l maintainence and r e p a i r . . . (but) age (v/as) the most important cause of v a r i a t i o n . . . w i t h n o n - r o u t i n e maintainence c o s t s i n c r e a s i n g s h a r p l y f o r v e s s e l s over seven years o l d " . 137 These c o s t s amounted to about 14$ of t o t a l c o s t s . While the " d e f i n i t i o n o f c o s t s r e l a t e ( d ) o n l y to o u t - o f - p o c k e t expenses p l u s d e p r e c i a t i o n , the owner must a l s o c o n s i d e r ( f o r o l d e r v e s s e l s ) the 'per diem' c o s t s of e x c e s s i v e time spent under r e p a i r and the l o s s of net revenues from b u s i n e s s s a c r i f i c e d through breakdowns and delay".138 Another c o s t r e l a t e d to v e s s e l a g e , i s the c o s t of i n s u r a n c e , u s u a l l y 5$ - 10$ o f t o t a l c o s t s , but on o c c a s i o n 139 observed to be as h i g h as 18$. O'Loughlin hastens to add t h a t t h i s d i v i s i o n can v a r y w i d e l y , and i t " i s the f a c t o r s making f o r v a r i a t i o n s i n these p r o p o r t i o n s , r a t h e r than t h e i r 140 exact share i n the t o t a l " t h a t are of the most i n t e r e s t . 141 The A r t h u r D. L i t t l e Study O'Loughlin's o b s e r v a t i o n would appear to be p a r t i c u l a r l y v a l i d when a n a l y s i z i n g the o p e r a t i n g c o s t s of c o n t a i n e r s h i p s . The A r t h u r D. L i t t l e Study concluded t h a t "annual o p e r a t i n g c o s t s , e x c l u d i n g f u e l , . . . f o r a l l p r a c t i c a l purposes, do not 142 depend on the voyage l e n g t h " , while t o t a l " s h i p c o s t s 143 depend on both the s i z e and the speed o f the v e s s e l " . V e s s e l s i z e i s determined by the volume of cargo c a r r i e d , which i s a f u n c t i o n of the t r a f f i c flow, and v e s s e l speed i s a f u n c t i o n o f the number of p o r t s of c a l l , the time spent i n each p o r t , the l e n g t h o f the round t r i p voyage, and the voyage turnaround time chosen by the o p e r a t o r . The L i t t l e Study assumed t h a t v e s s e l turnaround times 145 must be i n m u l t i p l e s of ? days f o r marketing purposes. V/hile t h i s c r i t e r i o n has been chosen by many of the steamship l i n e s o p e r a t i n g a c r o s s the A t l a n t i c , i t appears to be o n l y an added and p r o b a b l y an unnecessary r e s t r i c t i o n ; the Japanese a p p a r e n t l y operate s u c c e s s f u l l y on a p u b l i s h e d 10 day schedule. Because of the v a g a r i t i e s of the weather, (storms, f o g ) ; l a b o r , ( w i l d c a t o r l e g a l stoppages); and human and mechanical f a l -l i b i l i t y ; s t r i c t adherance to any schedule over l o n g p e r i o d s of time seems i m p o s s i b l e . With ro u n d - t h e - c l o c k , seven-days-a-week p o r t o p e r a t i o n , f o u r - a n d - a - h a l f day steaming schedules, as proposed by SeaLand f o r the A t l a n t i c t r a d e , seem q u i t e 146 • f e a s i b l e . The A r t h u r D. L i t t l e Study u t i l i z e d a s p e c i a l mathematical c o n t a i n e r s h i p model, developed by the Department of Naval A r c h i t e c t u r e and S h i p b u i l d i n g a t the U n i v e r s i t y of Newcastle-upon-Tyne. T h e i r f i n d i n g s were t h a t f o r a £4.9 m i l l i o n investment i n a 697-foot, 29*000 g r t c o n t a i n e r v e s s e l , capable of c a r r y i n g 1 , 3 0 0 twenty f o o t ISO c o n t a i n e r e q u i v a l e n t s a t 2 2 knots, annual o p e r a t i n g c o s t s would be as shown i n Table 2 . 3 . Because of the v e r y h i g h c a p i t a l c o s t s i n v o l v e d i n c o n t a i n e r s h i p c o n s t r u c t i o n , the annual c o s t s of s e r v i c i n g t h i s debt becomes overwhelmingly the l a r g e s t s i n g l e o p e r a t i n g c o s t ; a p p r o a c h i n g 10 times the wage b i l l . ANNUAL OPERATING COSTS  FOR A 29,000 g r t CONTAINER.SHIP TRAVELLING AT 22 KNOTS Annual C a p i t a l Charge ;£ 643,000 Wages 68,000 S u b s i s t e n c e 6,000 H u l l Maintenance 13,000 S t o r e s 4,000 P and I Insurance 10,000 H u l l Insurance 38,000 Overheads 27,000 T o t a l Cost £ 8 4 0 , 0 0 0 per annum F u e l c o s t s equal £ 1.. 33 per sea-mile steamed on a c o s t b a s i s o f "98/ per ton used a r a t e of .4 lb/SHP h r . " ( S i n c e f u e l c o s t s have r i s e n c o n s i d e r a b l y t h i s c o s t data i s undoubtedly too low even f o r 1971 c a l c u l a t i o n s , ) Sources "Transhipment i n the S e v e n t i e s " , A Report to tne N a t i o n a l P o r t s C o u n c i l prepared by A r t h u r D. L i t t l e L t d . London. 1970. p.48. v e r y l a r g e c a p i t a l investment, the high annual i n s u r a n c e c o s t s are not s u r p r i s i n g e i t h e r . The f a c t o r s which are s u r p r i s i n g are t h a t the p r o f i t i s taken as o n l y 5$ of t o t a l c a p i t a l c o s t s , w h ile the p r i c e of the s h i p i s d i s c o u n t e d over 15 y ears a t 10$. (However these v a l u e s are p r o b a b l y f a i r l y r e a l i s t i c s i n c e the model i s supposed to be a p p l i c a b l e f o r any speed between 20 and 35 knot 14? and any v e s s e l s i z e from 800 to 3»5°0 c o n t a i n e r c a p a c i t y . A l s o the p r o f i t a b i l i t y of c o n t a i n e r s h i p owners has not been 148 e a r t h s h a k i n g to date. ) F uture Trends I n c r e a s e d Speeds In view of the i n c r e a s i n g speeds s t i l l b e i n g b u i l t i n t o the d e s i g n of c o n t a i n e r v e s s e l s , two items of c o s t s should be mentioned i n more d e t a i l : c a p i t a l c o s t s and f u e l expenses. The c a p i t a l c o s t s of a d d i t i o n a l speed i n c l u d e d a t the time of c o n s t r u c t i o n are e s timated to i n c r e a s e by 10$ to 12$ " f o r each e x t r a knot f o r a medium-sized cargo s h i p i n the 12. to 20 knot 149 range". Whether t h i s r e l a t i o n s h i p of i n c r e a s e d c o s t f o r i n c r e a s e d speed h o l d s f o r the new d e s igns of 30 and 40 knot c o n t a i n e r s h i p s i s u n c l e a r to t h i s author, but the i n d i c a t i o n s are t h a t c o s t s a c t u a l l y i n c r e a s e a t a f a s t e r r a t e . The U.N. Study on c o n t a i n e r s h i p s i n d i c a t e s t h a t a " s t r o n g and o f t e n a c o n t r o l l i n g i n f l u e n c e i n c o n t a i n e r s h i p o p e r a t i o n i s the combination of l a r g e s i z e o f v e s s e l r e q u i r e d by the c e l l u l a r h o l d s t r u c t u r e and the s u b s t a n t i a l speeds r e q u i r e d by the economics of voyage turnaround time ...A h i g h r a t i o of h u l l c u b i c space to weight of cargo l i f t e d . . . ( i n d i c a t e d t h a t ) c o n t a i n e r s h i p s o f 20,000 to 150 25,000 dwt with speeds of 21 to 25 knots become economic" With fewer v e s s e l s but h i g h e r c a p i t a l c o s t s , the tendency has been f o r a number of c o n s o r t i a to develop on the major t r a d i n g r o u t e s . F u e l c o s t s are s u b j e c t to wide v a r i a t i o n s , depending on engine type and the l o c a t i o n of r e f u e l i n g depots. Too, a f u l l y l a d e n v e s s e l uses 6$ more f u e l than the same s h i p i n b a l l a s t . "But the g r e a t e s t cause of v a r i a t i o n of f u e l c o s t i n any one v e s s e l i s speed. The formula f o r f u e l consumption r e l a t e d to speed i s a c u b i c f u n c t i o n r e s u l t i n g from the e f f e c t s o f water displacement on a displacement h u l l . . . F o r speeds m a t e r i a l l y above...(the most) economic speed the f u e l c o s t i n c r e a s e ( s ) e x c e s s i v e l y so t h a t f o r c e r t a i n h u l l s twice the amount of f u e l may be r e q u i r e d to o b t a i n a speed of 22 knots as f o r 18 knots. Below...economic speeds, a r e d u c t i o n i n speed does not b r i n g comparable... s a v i n g s " . 15* O b v i o u s l y the move from 12 to 16, then 20 and 23 and now to perhaps 30 or 40 knot v e s s e l s has o n l y been p o s s i b l e w i t h a change i n the d e s i g n o f v e s s e l h u l l s , and a t the expense of f u e l economies. However i n c r e a s e d payloads seem to have o f f s e t the c o s t s of these h i g h e r speeds. N u c l e a r Power The V i c k e r s Company of B r i t a i n e a r l y i n 1969 p r e s e n t e d 152 p l a n s , f o r the development of an e c o n o m i c a l l y v i a b l e n u c l e a r powered c o n t a i n e r s h i p which would develop a p p r o x i m a t e l y 80,000 shp ( v s . 35,000 shp i n the l a r g e s t v e s s e l s a t p r e s e n t ) . The Company claimed t h a t by having to r e f u e l o n l y once every f o u r y e a r s , the s h i p c o u l d c a r r y 21% more c o n t a i n e r s on the New Zealand-United Kingdom route than a c o n v e n t i o n a l c o n t a i n e r s h i p of the same s i z e and speed, thereby j u s t i f y i n g the e x t r a 50 p e r c e n t i n c a p i t a l investment. ECONOMICS OF CONTAINERIZATION FOR PORTS • WORLD PORT INVESTMENT As f a r as p o r t investment i s concerned, $5 to $10 m i l l i o n seems to be the minimum p o s s i b l e f o r a 1 b e r t h , 1 crane, 10 a c r e back-up c o n t a i n e r y a r d development, with no apparent upper l i m i t to the investment t h a t may e v e n t u a l l y be i n v o l v e d . In the p a s t 10 years the P o r t o f London A u t h o r i t y has spent 153 4>80 m i l l i o n on the T i l b u r y t e r m i n a l , while nine major competing p o r t s on the 400 m i l e s of c o a s t l i n e from Dunkirk to Hamburg have i n v e s t e d more than $180 m i l l i o n i n p r e p a r i n g f o r 154 the c o n t a i n e r boom d u r i n g the p e r i o d I966 - I 9 6 9 . The P o r t of New York budgeted f o r expenditures of. $41.5 m i l l i o n on t h e i r 155 c o n t a i n e r f a c i l i t i e s i n 1971 alone, and w i l l have spent a t 156 l e a s t $175 m i l l i o n by 1973* Some examples of p o r t investment f o r c o n t a i n e r f a c i l i t i e s by s e l e c t e d world p o r t s i s pre s e n t e d i n Table 2 . 4 . D e t a i l s of p o r t f a c i l i t i e s i n p a r t i c u l a r r e g i o n s of the world are pres e n t e d by Axelson, 157 Immer and some trade j o u r n a l s . The Japanese S h i p p i n g and Ship B u i l d i n g R a t i o n a l i z a t i o n EXAMPLES OF INVESTMENT BY SELECTED WORLD PORTS  FOR DEEP SEA CONTAINER HANDLING FACILITIES CONTAINER FACILITY COMPLETION PORT INVESTMENT ( $ U . S . ) DATE 1. New York $ 175 M i l l i o n 1973 2. T i l b u r y (London) 80 M i l l i o n 1970 3. Osaka, Kobe, Tokyo, and Yokahma 250 M i l l i o n 1972 4. Hamburg 25 M i l l i o n 5. Antwerp 50 M i l l i o n 1970 6. Melbourne 20 M i l l i o n — 7. Singapore 26 M i l l i o n 1971 8. S e a t t l e 110 M i l l i o n 1975 9. Vancouver 5 M i l l i o n 1970 Sources 1. A . J . Tobin, " C o n t a i n e r i z a t i o n Boom a t P o r t of New York", The Westsider. West Side A s s o c i a t i o n o f Commerce, Inc., New York, N.Y. F a l l 196?. p. 18+ 2. ? "Developments i n London", F a i r p l a y . J u l y 16, 1970. pp. 32-33. 3. J.P. C o u g h l i n , " C o n t a i n e r s - I n t e r n a t i o n a l Acceptance", The Westsider. West Side A s s o c i a t i o n of Commerce, Inc., New York, N.Y. F a l l 1969. p. 50+ 4. , "Germany's Major C o n t a i n e r P o r t s Expand", F a i r p l a y . J u l y 2, 1970. p. 128. 5. N. Hacking, "Crane Stands M o s t l y I d l e " , The (Vancouver)  P r o v i n c e . J u l y 22, 1970. p. 16. 6. J.P. C o u g h l i n , op. c i t . , The Westsider. F a l l 1969. P-50+ 7. , "Van Push i n Singapore", D i s t r i b u t i o n Worldwide. 6ctob e r 1969. p. 81. 8. J.E. Opheim, " C o n t a i n e r i z a t i o n i n the S e v e n t i e s " , An address to the Proceedings of the Canadian T r a n s p o r t - a t i o n Research Forum by the General Manager of the P o r t of S e a t t l e . Vancouver, B.C. March 20, 1970. 9. ."Con t a i n e r P i e r Mow O p e r a t i o n a l " , B r i t i s h Columbia  Bu s i n e s s J o u r n a l . June - J u l y , 1970. pp.. 22+ the c o n s t r u c t i o n of 12 c o n t a i n e r s h i p s , with c o n t a i n e r s h i p b e r t h s and f a c i l i t i e s t h a t over the 4 year p e r i o d of 196Q-1972 would i n v o l v e an investment of approximately $450 m i l l i o n The steamship companies a l s o have e x t e n s i v e p o r t investments as evidenced by the planned t e r m i n a l f o r SeaLand 159 a t Rotterdam c o s t i n g $15 m i l l i o n . S e a t r a i n L i n e s , i n December 1970, agreed to s e l l t h e i r 33 acre Oakland c o n t a i n e r t e r m i n a l to the P o r t of Oakland f o r $20 m i l l i o n and l e a s e i t 160 back a t an e s t i m a t e d $1,500,000 a n n u a l l y . T h i s data i n d i c a t e s t h a t Canada's investment of $5 to $15 m i l l i o n per p o r t i s s m a l l by comparison. PORT TECHNOLOGY CHANGES P o r t Purpose> Deep-Sea or Feeder Hedden, i n d i s c u s s i n g the p l a n n i n g f o r c o n t a i n e r i z a t i o n i n d e v e l o p i n g c o u n t r i e s p r e d i c t e d t h a t c o n t a i n e r s h i p p i n g s e r v i c e s would tend to c o n c e n t r a t e a t the l a r g e r p o r t s of the U.S., Europe, A u s t r a l i a , Japan, Puerto Rico, and Hawaii where there i s a high i n h e r e n t demand. From these areas " f e e d e r s h i p s w i l l r a d i a t e to the Caribbean, South America, 161 the Mediterranean, and some o t h e r d e v e l o p i n g c o u n t r i e s " . I f the t r e n d to c o n t a i n e r i z a t i o n of a l a r g e p a r t of the c u r r e n t non-bulk ocean cargo develops as expected, the p o r t of the f u t u r e w i l l be an even more c a p i t a l i n t e n s i v e c o n t a i n e r o p e r a t i o n s w i l l e i t h e r switch i n t o 'feeder p o r t s ' , or become completely redundant and unused. E a r l y i n 1970 there were 28 g i a n t c o n t a i n e r cranes s t a n d i n g ' l i k e g i a n t g o a l p o s t s ' on the Northwest European coast. Not one was working a t more than 40$ of c a p a c i t y , but more cranes are s l a t e d f o r e a r l y i n s t a l l a t i o n . For example, the number of g a n t r y cranes a t Rotterdam w i l l be i n c r e a s e d from f o u r to ten 162 by 1972. C a p t a i n S t i g Axelson, Manager of the P o r t of Gothenberg, pr e s e n t e d some c a l c u l a t i o n s to the I n t e r n a t i o n a l C o n t a i n e r Symposium i n London i n 1968 which i n d i c a t e d t h a t even u s i n g a 10$ c o s t of c a p i t a l , the c o s t of moving c o n t a i n e r i z e d cargo was l e s s than 50$ (perhaps o n l y 30$) of the c o s t of moving 163 c o n v e n t i o n a l cargo on a per-ton-moved b a s i s . T h i s compared 164 f a v o r a b l y with the f i n d i n g s of McKinsey's 1967 study. C a p t a i n A x e l s o n concluded t h a t day by s a y i n g t h a t the r e v o l u t i o n c o u l d not take p l a c e f o r e i t h e r shipowners or p o r t s "without c a s u a l t i e s : those who d i d not have the f i n a n c i a l r e s o u r c e s and/or the courage and/or the r i g h t t r a de and/or the r i g h t l o c a t i o n had, and have, to l o s e on the change. Great r i s k s are taken by the shipowners and by the p o r t a u t h o r i t i e s " . 165 T h i s view has been borne out by the withdrawal from the North 166 P a c i f i c trade of c o n t a i n e r s e r v i c e s by Matson, and Moore McCormack, and by the Furness, Royal M a i l , F r e d Olsen and 167 W e s t f a l l - L a r s e n L i n e s because of the c o m p e t i t i o n . 168 The problems of the P o r t of P o r t l a n d , B r i s t o l , and I69 perhaps even L i v e r p o o l , are the r e s u l t of c o n t a i n e r i z a t i o n and to some ex t e n t l a b o r ' s response to t h i s ' r e v o l u t i o n ' i n t r a n s p o r t a t i o n . " T h i s i s o n l y r i g h t and proper with an i n t e g r a t e d t r a n s p o r t as the common g o a l . . . c o n t a i n e r i z a t i o n i s p a r t of a door-to-door t r a n s p o r t a t i o n system, and the s h i p owner has "gone a s h o r e " . . . ( w h i l e ) the road h a u l e r has "gone to sea"... Forwarding agents... have d i s c o v e r e d . . . t h a t the new t r a n s p o r t a t i o n p a t t e r n a t sea i s c r e a t i n g a demand f o r s e r v i c e s v e r y much l i k e those l o n g s i n c e asked f o r i n i n t e r n a t i o n a l road and r a i l t r a n s p o r t a t i o n . . . b u t they have not -as f e a r e d - l o s t b u s i n e s s . " 170 The technology of a p o r t s u i t a b l e f o r c o n t a i n e r s changes r a p i d l y , as Mr. J.E. Opheim, General Manager of the P o r t of S e a t t l e , p o i n t e d out when he spoke b e f o r e the Canadian T r a n s p o r t a t i o n Research Forum i n Vancouver i n March 1970 s a y i n g "The o l d break-bulk v e s s e l o p e r a t i o n under which b e r t h -l i n e r s might... spend...two or three weeks d i s c h a r g i n g and l o a d i n g out a t a...number of p o r t s cannot be c a r r i e d over i n t o the new concept. The h i g h c o s t of b u i l d i n g and o p e r a t i n g . . . c o n t a i n e r v e s s e l ( s ) a n d . . . c o n t a i n e r i n v e n t o r y and t e r m i n a l h a n d l i n g f a c i l i t i e s d i c t a t e s . . . a 24 hour or so i n - p o r t p e r i o d a t two, or a t the most, three p o r t s of c a l l . V e s s e l s i z e , speed and c a r r y i n g c a p a c i t y w i l l be s u b s t a n t i a l l y i n c r e a s e d . ( V e s s e l s on the p l a n n i n g boards today) w i l l be the f o r e r u n n e r s of even l a r g e r v e s s e l s c a r r y i n g . . . 2 thousand and more c o n t a i n e r s i n t h i s c u r r e n t decade... P o r t a u t h o r i t i e s w i l l f e e l . . . t h e almost overwhelming c o m p e t i t i v e rush and burden of p r o v i d i n g the l a n d areas and c a p i t a l funds f o r the development of c o n t a i n e r t e r m i n a l f a c i l i t i e s , c o n t a i n e r cranes and y a r d h a n d l i n g equipment... Today.,.we (are wondering) i f a one thousand f o o t b e r t h , f o r t y - f i v e to f i f t y ton c a p a c i t y cranes... t w e n t y - f i v e a c r e s of c o n t a i n e r y a r d per b e r t h , and a t l e a s t three p i e c e s of y a r d h a n d l i n g equipment per crane . . . w i l l be s u f f i c i e n t . By the end of t h i s decade...at l e a s t one o f the h i g h l y i n d u s t r i a l l o a d c e n t e r p o r t s . . . ( w i l l have) i n s t a l l e d a f u l l y automated pigeonhole p a r k i n g system...By 1975 "the important trade r o u t e s . . . o f North A m e r i c a . E u r o p e . , . a n d A u s t r a l i a . , . s h o u l d . . . b e f u l l y c o n t a i n e r i z e d . I t w i l l be a b s o l u t e l y n e c e s s a r y to computerize the documentation load...(and) s i m p l i f i c a t i o n of documentation and customs i n s p e c t i o n s procedures i n i n t e r n a t i o n a l commerce must come". 171 The economies of s c a l e f o r l a r g e s h i p s , e v i d e n t i n lower o p e r a t i n g c o s t s per ton as s i z e i n c r e a s e s , can q u i c k l y be l o s t i f p o r t working i s slow. C u f l e y remarks t h a t c a r r i e r s can " h a r d l y expect to o b t a i n maximum advantage fr o m . . . g i a n t " b u l k e r s " u n l e s s . . . ( t h e s e v e s s e l s r e c e i v e ) f a r b e t t e r d i s p a t c h 172 i n p o r t s t h a n . . . c o n v e n t i o n a l tonnage". Unquestionably the op t i m a l s h i p s i z e v a r i e s almost d i r e c t l y with the speed of 173 cargo h a n d l i n g on the docks, but with annual throughput 174 c a p a c i t i e s o f c o n t a i n e r t e r m i n a l s b e i n g up to 10 times g r e a t e r , 175 than the 10 tons p e r meter of b e r t h f o r c o n v e n t i o n a l cargo, i t seems a x i o m a t i c t h a t most major t r a d e s w i l l become c o n t a i n e r i z e d f a i r l y q u i c k l y . The speed with which dock l a b o r i s r e p l a c e d by mechanization i s to some exte n t a r e f l e c t i o n of the dockworkers age, s k i l l s 176 and union m i l i t a n c y . . The McKinsey Report f o r e c a s t a 90$ r e d u c t i o n i n dock l a b o r requirements over the next 20 to 30 ye a r s , w h i l e an A u s t r a l i a n Longshore Union o f f i c i a l foresaw a decrease i n the wate r s i d e work f o r c e "from 21,000 to 13»000 i n 177 ten y e a r s " . While tramp or l i n e r v e s s e l s i z e may be l i m i t e d to some e x t e n t when the demand i s f o r s m a l l e r more f r e q u e n t s a i l i n g s , t h i s seems to be one of the b e s t reasons f o r promoting c o n t a i n e r i z a t i o n u s i n g s p e e d i e r v e s s e l s . The aggragate demand a v a i l a b l e (and f o r e c a s t ) w i l l determine to a c o n s i d e r a b l e degree the u l t i m a t e s i z e o f the c o n t a i n e r v e s s e l s . I t has been found t h a t the two main items of voyage to some extent. Certainly d a i l y port charges vary d i r e c t l y with the time spent i n port, with the number of ports, and to some extent v/ith ship size and number of hatches. The saving from bulk working or containerization " w i l l be greatest i n the per diem costs of time saved, and to some extent i n d i r e c t 178 handling charges, but less on port fees as such". Goss, i n discussing the turnround times encountered on cargo l i n e r s concluded that 60$ of the conventional cargo ship's time was spent i n port, and that f o r only 15$ of t h i s time was cargo "being worked at any hatch i n the ship...(therefore) only 6$ of 179 the year was spent i n loading and discharging cargo". Compare t h i s with projected turnaround times of 36 hours f o r container ships i n modern container terminals. Since handling charges are mostly labor costs, they w i l l vary with the port and the f a c i l i t i e s a v a i l a b l e . Undoubtedly bulk cargoes can be worked more r a p i d l y than baled cargoes, and the use of standard sized containers means f a s t e r handling than f o r mixed cargoes. While there are l i m i t s to the extent to which containerization can be implemented i n those trades invo l v i n g large export volumes of raw materials with much smaller volumes of manufactured goods inbound, world ocean trade i s moving r a p i d l y towards the generally quoted forecast 180 of 65$ to 75$ containerization of dry cargo possible by 1975* One o t h e r f a c t o r t h a t c o u l d have a s i g n i f i c a n t b e a r i n g on the f u t u r e demand f o r deep-sea c o n t a i n e r s h i p s i s the degree with which c o n t a i n e r i z e d cargo begins to move by a i r f o r p a r t or a l l of i t s journey. " I t i s est i m a t e d t h a t the number of c o n t a i n e r s to be used i n a i r l i n e systems w i l l i n c r e a s e from 10,000 ( i n 1966) to 5 0 , 0 0 0 ...(so* t h a t ) by 1975 about 80$ of a i r f r e i g h t w i l l be moved i n c o n t a i n e r s . A g r e a t number of v a r i o u s s i z e d c o n t a i n e r s are r e g i s t e r e d f o r a i r f r e i g h t use, r a n g i n g i n s i z e from 12 c u b i c f e e t to the 8* x 8' c r o s s s e c t i o n ISO van c o n t a i n e r . " 181 Cu r r e n t o p e r a t i n g c o s t , of 15 cents per ton-mile f o r 7 0 7 's and DC-8's c a r r y i n g 90 ,000 pound l o a d s i s not v e r y c o m p e t i t i v e w i t h r a i l o r ocean c a r r i a g e , but a f i g u r e of 30 to 50 per ton-mi l e i s b e i n g advanced f o r the Boeing ?4? c a r r y i n g approximately 250,000 l b s . o f cargo. With the i n t r o d u c t i o n o f the L - 1 0 1 1 h a v i n g a 360,000 pound f r e i g h t c a p a c i t y , c o s t s are expected to 182 be about 2f. per to n - m i l e . 183 Sturmey, notes t h a t the t r e n d i n c o s t s o f u n i t i z e d cargo by sea t r a n s p o r t i s unknown, (although i t appears c o s t s may be r i s i n g ) w h i l e the t r e n d i n a i r t r a n s p o r t i s down..(No s t u d i e s have y e t been done on a i r vs sea c o n t a i n e r c o s t t r e n d s ) . I t i s p o s s i b l e t h a t i n the f u t u r e , a i r t r a n s p o r t may even c o s t l e s s than by sea. P r o p o s a l s are b e i n g advanced f o r moving 184 c o n t a i n e r s by H o v e r c r a f t o r a i r s h i p s a t speeds of 100-150 mph. Should these p r o p o s a l s develop, i t seems almost c e r t a i n t h a t an economical maximum c o n t a i n e r v e s s e l s i z e w i l l soon be reached f o r deep-sea t r a n s p o r t a t i o n . T h i s would l i m i t , o r perhaps even POTENTIAL CONTAINER CARGOES World Scene John Immer c i t e s s t u d i e s which i n d i c a t e t h a t by 1973 up to 38$ of a l l A t l a n t i c l i n e r cargo w i l l move on c o n t a i n e r s h i p s , w i t h 22$ of the P a c i f i c (Hawaii, A l a s k a , and F a r East ) trade 185 b e i n g c o n t a i n e r i z e d . F o r e c a s t s are t h a t a decade l a t e r these percentages w i l l be 58$ and 45$ r e s p e c t i v e l y . H i s f i g u r e s suggest t h a t 23$ of the t o t a l world l i n e r cargo o f 5^.^ m i l l i o n tons v / i l l be i n c o n t a i n e r s by 1973» w i t h a f o r e c a s t o f 61.7 m i l l i o n tons by 1983' 186 Data p r e s e n t e d by Immer, a l s o showed t h a t c o n t a i n e r s moving from the U.S., to Europe i n 1968 co n t a i n e d a p p r o x i m a t e l y 8,2 tons each, w i t h the r e t u r n t r i p s c a r r y i n g 9.1 tons i n each 187 'box'. S i m i l a r l y , c o n t a i n e r s moving westward a c r o s s the P a c i f i c each c a r r i e d 9 tons of North American e x p o r t s , but o n l y 188 a p p r o x i m a t e l y 6 tons p e r c o n t a i n e r was b e i n g moved eastward. P o r t o f Vancouver The 1967 Kates, Peat, Marwick Study of c o n t a i n e r 189 f a c i l i t i e s f o r Vancouver, i n d i c a t e d t h a t the average a r r i v i n g c o n t a i n e r would p r o b a b l y convey o n l y 6 tons of P i e r confirm' t h i s p r e d i c t i o n . That Study also indicated that i n i t i a l l y containerized t r a f f i c coming into the Port of Vancouver from a l l countries would be 70$ l o c a l and 30$ through-billed, gradually changing to a 50-50 s p l i t as the 1975 anticipated volume of 50,000 containers per year i s 191 attained. This change indicates the increasing importance of cargo a r r i v i n g from OCP o r i g i n t e r r i t o r y ( p a r t i c u l a r l y Japan), which currently i s 30$ l o c a l and 70$ through-billed. I t could well be that the weight per container w i l l be higher i n the future and therefore less of a l i m i t i n g f a c t o r , (see Chapter IV), i f forecast changes i n the composition of Japanese exports to North America are attained. The current 60$ of t o t a l content i n consumer goods i s expected to decrease, so that by 1975* 55$ of Japan's exports w i l l be machinery and only 10$ w i l l be t e x t i l e s . The value of Japanese imports from Canada are forecast to increase from the present $1.1 b i l l i o n to $2.2 b i l l i o n , while Japan's exports to Canada are projected 192 to t r i p l e from today's $560 m i l l i o n to $1.3 b i l l i o n . 193 PORT OF VANCOUVER CENTENNIAL PIER CONTAINER TERMINAL Since t h i s study deals p r i m a r i l y with containerized cargo moving to Canadian OCP destinations, a b r i e f discussion of the container handling f a c i l i t i e s at Centennial P i e r #6 i n the Port of Vancouver i s i n order. The Centennial P i e r Container Terminal ^ located on the South shore of Burrard I n l e t at the f o o t of Dunlevy S t r e e t immediately northwest of the CNR m a r s h a l l i n g yards, (see Map 2.1). I t i s owned by the N a t i o n a l Harbour's Board of Canada, but i s operated under a 5 y e a r l e a s e by the Empire S t e v e d o r i n g Company L t d . , a s u b s i d a r y of Furness, Withy^and Company L i m i t e d . T h i s 68? f o o t l o n g b e r t h i s equipped with a ' S t a r p o r t e r ' type, d i e s e l e l e c t r i c g a n t r y crane. T h i s crane, of 40 l o n g - t o n c a p a c i t y , has a t o t a l spreader beam t r a v e l l i n g d i s t a n c e of 193a f e e t , i n c l u d i n g a maximum out-reach from dockside of 113 i f e e t . The spreader has an automatic l o c k i n g attachment f o r 20 and 40 f o o t c o n t a i n e r s , and with a s p e c i a l attachment, can a l s o be used to l i f t c o n t a i n e r s c o n t a i n i n g loads t h a t are 'over h e i g h t ' ( i . e . loads t h a t p r o t r u d e above the c o r n e r s of the 8 f o o t c o n t a i n e r i t s e l f ) . The h o i s t speed i s 100 fpm, under a 30-ton l o a d , w i t h a h o r i z o n t a l - m o v i n g t r o l l e y speed of 400 fpm, ( f o r d e t a i l s see Appendix V). Map 2.1 on page 64 i l l u s t r a t e s the p h y s i c a l o r i e n t a t i o n of the c o n t a i n e r t e r m i n a l f a c i l i t i e s . These c o n s i s t of the f o l l o w i n g major a r e a s : (a) a 100,000 square f o o t shed f o r storage of cargo a w a i t i n g stowage i n a c o n t a i n e r or a w a i t i n g f o r w a r d i n g a f t e r d e s t u f f i n g from a c o n t a i n e r ; (b) a C o n t a i n e r F r e i g h t S t a t i o n (CFS) where the a c t u a l s t u f f i n g and d e s t u f f i n g of c o n t a i n e r s i s performed ( l o c a t i o n i s a t the doors of the shed); (c) a C o n t a i n e r Yard (CY) where f u l l c o n t a i n e r s are s t a c k e d two l a y e r s high av/aiting l o a d i n g on board 6 7 8 9 10 11 12 Gantry Crane O f f i c e \ . 300 Ton HCrane Containers^ b e i n g D e s t u f f e d X C o n t a i n e r s b'eing S t i f f e d L i q u o r Cage S c a l e \ Equipment Storage \ Gate House S t r a d d l e C a r r i e r Garage P o o l c a r Loading Dock \ Cont a i n e r s For d i r e c t R \ i l Movement \ CONTAINER S TORAGE 10 f \ 5 * » w CNR MARSHALLING YARDS PORT OF VANCOUVER  CONTAINER TERMINAL MAP 2.1 ON s h i p f o r export, or placement on r a i l or t r u c k f o r inbound movement ( l o c a t i o n i s towards the west end of the dock between the r a i l w a y t r a c k s and the g a n t r y c r a n e ) ; (d) a CY-CFS a r e a where f u l l c o n t a i n e r s of cargo are p l a c e d a w a i t i n g d e s t u f f i n g d i r e c t l y i n t o a r a i l c a r o r t r u c k , without the goods b e i n g moved i n t o and through the shed ( l o c a t i o n i s between the CY and the CPS) j (e) Reefer C o n t a i n e r Storage and S e r v i c e a r e a f o r 60 • r e f r i g e r a t e d c o n t a i n e r s s t a c k e d two l a y e r s h i g h ( l o c a t i o n i s south of the r a i l w a y t r a c k s ) ; ( f ) empty c o n t a i n e r storage a r e a ( l o c a t e d s u r r o u n d i n g r e e f e r a r e a and south of f r e i g h t shed); (g) s t o r a g e and p o s i t i o n i n g of c o n t a i n e r s r e q u i r i n g r e p a i r s ; (h) 4,300 f e e t of p a r a l l e l r a i l w a y trackage s u f f i c i e n t to accommodate over 80 c o n t a i n e r f l a t c a r s ; ( i ) a 10' x 70' f i f t y - t o n Toledo S c a l e f o r weighing e i t h e r c o n t a i n e r s or the incoming loaded t r u c k s . The t o t a l back-up a r e a i s o n l y 12 to 15 a c r e s and no c l e a r p h y s i o g r a p h i c s e p a r a t i o n i s made between any o f : the CY; the CY-CFS storage a r e a ; the CFS storage area; or the empty c o n t a i n e r storage a r e a . T h i s c r e a t e s some problems f o r continuous m o n i t o r i n g of the l o c a t i o n of every c o n t a i n e r on the dock, p a r t i c u l a r l y when the ground has a c o v e r i n g of snow. Most ot h e r deep-sea c o n t a i n e r p o r t s segregate the CY and the Immediately a d j a c e n t to the CFS shed, on the west and no r t h s i d e s of the b u i l d i n g , are a number of angled 'parking spaces' to which CFS-destined c o n t a i n e r s are moved f o r d e s t u f f i n g . Once c o n t a i n e r s have been p o s i t i o n e d i n a row one l a y e r h i g h i n these angled spaces, subsequently d i s c h a r g e d c o n t a i n e r s are p o s i t i o n e d i n the f i r s t h a l f dozen rows immed-i a t e l y west of shed #5> as f a r as the base of the 300-ton heavy l i f t crane. In t h i s CFS storage a r e a the loaded c o n t a i n e r s are s t a c k e d 2 l a y e r s h i g h . Each c o n t a i n e r storage p o s i t i o n has a number; the bottom l a y e r b e i n g odd-numbered, with the even number p o s i t i o n s b e i n g a l l o c a t e d to the top or 2nd l a y e r . For example, i n Row 4 the p o s i t i o n s would be 4:1, 4:3, 4:5.... i n the bottom l a y e r , and 4"2, 4:4, 4:6.... i n the 2nd l a y e r . Removal from t h i s CFS storage a r e a to the shed would occur i n the f o l l o w i n g o r d e r : 4:2, 4:1, 4:4, 4:3, e t c . The ' c o n t a i n e r p a r k i n g spots* immediately west o f the CFS s t o r a g e p o s i t i o n s are c o n s i d e r e d to be CY-CFS st o r a g e . C o n t a i n e r s of high v a l u e goods (e.g. T.V. s e t s which w i l l e v e n t u a l l y be d e s t u f f e d i n the CFS) are s t o r e d here ( s e a l e d ) u n t i l the t r u c k s a r r i v e f o r removal o f the cargo from the dock a r e a . These goods may then be removed d i r e c t l y from the c o n t a i n e r and loade d d i r e c t l y i n t o the t r u c k , without b e i n g s u b j e c t e d to a p e r i o d of stor a g e i n the shed. Experience has shown t h a t t h i s procedure e l i m i n a t e s damage and p i l f e r a g e almost e n t i r e l y . In the CY storage a r e a are p o s i t i o n e d a l l those c o n t a i n e r s which are d e s t i n e d f o r removal from the w a t e r f r o n t area. These may be f o r l o c a l Vancouver d e l i v e r y , or f o r t r a n s -shipment e a s t to L o c a l or OCP p o i n t s by e i t h e r t r u c k or r a i l . F uture p l a n s c a l l f o r the purchase of a * t r a n s t a i n e r ' type of crane to span the r a i l r o a d t r a c k s f o r l o a d i n g and u n l o a d i n g f l a t c a r s or b o g i e s . SUMMARY I t i s difficult to obtain an accurate, up to date, total world investment in containerization. The number of container ships, plus other vessels which carry containers, can be obtained from L l o y d ' s R e g i s t e r i n London along with the builder, owner, ship type, propulsion, gross, and deadweight tonnage, 194 but value data is kept confidential, although i t may be that L l o y d ' s would release a 'total value'. I t would be even more difficult to determine the total investment in new port facilities (cranes., container yards, and container handling equipment). Even the total number and value of containers in operation around the world is probably unknown. (The N a t i o n a l Academy of S c i e n c e s — N a t i o n a l Research C o u n c i l presented a conservative 'rule of thumb* that 3 containers are required for each container slot on ocean 195 shipping. ) In the future as the speed of vessels increases, and as more companies turn to using containers as Hemporary' weatherproof storage f a c i l i t i e s , the number of containers required may be increased. I t may also happen that the current multitude of container lengths will gradually be replaced by containers of only 2?, 35» or 40 feet lengths and 8'6" in height because these "are the only sizes that can be 196 freely and economically interchanged with the inland carriers". A further problem is: What amount of money have the land and air carriers invested in container handling equipment? The world investment in container r a i l equipment is unknown, involvement of motor c a r r i e r s i n the c o n t a i n e r t r a n s p o r t 197 f i e l d . Undoubtedly both are s u b s t a n t i a l . Even i f these q u e s t i o n s c o u l d be answered, t o t a l c o n t a i n e r i z a t i o n investment would a l s o i n c l u d e : (1) the value of the computers used to t r a c k and document c o n t a i n e r s and t h e i r c o n t e n t s ; (2) the investment i n equipment by the s t e v e d o r i n g companies ( s t r a d d l e c a r r i e r s , f o r k l i f t s , and permanently s t a t i o n e d t r a c t o r s f o r r o / r o o p e r a t i o n s ) ; and (3) "the investment i n u pgrading manpower tech n i q u e s , and methods, and a l t e r i n g t h i n k i n g p a t t e r n s . The number of man hours i n v o l v e d i n s t u d y i n g and p r e p a r i n g r e p o r t s on c o n t a i n e r i z a t i o n i s a l s o a c o s t to the implementation of the concept, but p r o b a b l y the monetary amount i s not v e r y s i g n i f i c a n t i n the o v e r a l l p i c t u r e . As an example however, the r 198 McKinsev Report i s reputed to have c o s t over i 50*000 ($150,000). The c u r r e n t r e s e a r c h p r o j e c t i n t o Canadian c o n t a i n e r i z a t i o n , f o r the Canadian T r a n s p o r t Commission has a p r o j e c t e d budget 199 f o r Phase I I of over $100,000 p l u s computer c o s t s . A s i m i l a r s u b s t a n t i a l e f f e c t ( i n i n d i v i d u a l terms, but p r o b a b l y not v e r y s i g n i f i c a n t o v e r a l l ) , has been the added c o s t s of h a v i n g to a v o i d a chosen p o r t , and unload c o n t a i n e r s f o r t h a t p o r t ' s h i n t e r l a n d a t a n e i g h b o r i n g p o r t , e i t h e r due to l a b o r u n r e s t , or p o l i t i c a l i n t e r f e r e n c e v/ith cargo 200 movement. f i n a n c i n g new c o n t a i n e r i z a t i o n equipment, and the d i s p o s a l of c u r r e n t equipment which has not y e t been ' d e p r e c i a t e d out' and i s s t i l l m e c h a n i c a l l y u s e f u l , but i s t e c h n i c a l l y o b s o l e t e . T h e o r e t i c a l l y the investment i n t h i s o l d e r equipment (which c o n t a i n e r i z a t i o n has made o b s o l e t e ) i s a 'sunk c o s t ' and sho u l d be i g n o r e d , but the p o r t s , steamship l i n e s , and r a i l w a y companies can h a r d l y be expected to ' j u s t w r i t e o f f , wit h o u t comment, 50$ or more o f t h e i r cargo h a n d l i n g investment. In the f i n a l a n a l y s i s however, t h i s w r i t i n g - o f f of u n d e p r e c i a t e d investment may be the o n l y a l t e r n a t i v e , i f a p a r t i c u l a r company or p o r t wishes to remain a competitor f o r the g e n e r a l cargo 201 t r a d e . CHAPTER II 1. S.G. Sturmey, "The Impact of World Seaborne Trade on Changes in Shipping Costs", Lecture delivered to The  International Symposium on Middleterm and Longterm Forecasting  for Shipbuilding and Shipping, Stichting Maritieme Research, The Hague. June 16-18, 1970. pp. 35-55. 2. J. Anderson* writing on "English Transportation", cited in L.S. Crane, Coordinated Transportation, which is in turn cited in "Containerization, The Long Revolution", Transportation  and Distribution Management. Nov. 1970. pp. 22. cf. Sturmey, ibid. 3. Interstate Commerce Commission Activities 1937 - 1962.  Supplement to the Annual Report, U.S. Government Printing Office, Washington, D.C. 1962. pp. 1 3 I - I 3 6 . 4. This classification and terminology, and the following discussion on the development of co-ordinated transport services in the United States is based on material presented in the ICC  Activities 1937-1962, cited above. 5. ibid. 6. ibid. 7. ibid. cf. A . J . Tobin, Executive Director of Port of New York Authority attributes Seatrain Lines with the f irst real ocean going intermodal service when i t began moving railcars in coastal service from its 2-berth Edgewater N.J. fac i l i ty in 1929. A. J . Tobin, "Containerization Boom at Port of New York", The Westsider, Fa l l 1969. pp.18+ 8. J.R. Immer, Container Services of the North Atlantic, Work Saving International, Washington, D.C. 1967. pp. 3 cited in G.S. Rees, "Analysis of Potential Container Traffic in the Port of Vancouver", unpublished M.B.A. Thesis, University of British Columbia. 1969. pp. 11. I have been unable to verify the existance of the advertisement purported to have been in the Apri l 11, 1911 issue of National Geographic Magazine. 9. ICC Activities 1937-1962, op_. c i t . pp. 1 3 I - I 3 6 . 10. "Denmark - U.K. Trade Rationalization", Fairplay, May 7, 1970. pp. 6 8 - 7 0 . 11. G. Fromm, Transport Investment and Economic  Development, Paper by H. Hunter, "Transportation in Soviet Development", The Brookings Institution, Transport Research Program, Washington, D.C. 1965. pp. 139. 12. ICC Activities 1937-1962, op_. c i t . pp. 131-136. 13. Containerization International Yearbook 1970, National Magazine Co. Ltd. , London. 1969. p. 20. 14. Port of Sydney, March 1970. Advertisement on pp. v i i at the back of the issue. 15. J.P. Coughlin, "Containers - International Acceptance", The Westsider, Fal l 1969. pp. 50-53. 16. C. Clapham, "Containerization in the Seventies". Proceedings of the Canadian Transportation Research Forum, Panel Discussion, Vancouver, B.C. March 20, 1970. p. 2. 17. A . J . Tobin, op_. c i t . , The Westsider, Fal l 1969. pp. 18+ 18. Coughlin, OJJ. c i t . , pp. 52. 19. "Ful l Container Service", Advertising and Information Publication, Yamashita-Shinnihon Steamship Co. Ltd. , Tokyo. Sept. 1970. cf. D. Spink, Personal Interview. c f . " ' ^ Lines Pacific Service", Fairplay, Jan. 7, 1971. P. 33. 20. ibid. 21. ib id . 22. Examples would be Singapore and Hong Kong, see Shipping  World and Shipbuilder, July 1970. p. 945+, 951+; Also South America and South Africa, see The Westsider, Fal l 1969. p. 50+, and Fairplay, May 7, 1970. p. 83. 23. "A New White Pass Container Route Serves the Yukon and Northern British Columbia", Advertising literature of the White Pass and Yukon Railway Company, pp. 1-2. 24. "Container Operations in Vancouver", Purchasing in  Western Canada, Feb. 9171. pp. 6-9. 25. "Container Pier Now Operational", British Columbia  Business Journal, June-July 1970. pp. 22+ cf. The Province, June 1, 9170. 28. " S h i p b u i l d i n g and S h i p p i n g i n Japan Today", F a i r p l a y , June 18, 1970. p. 67. c f . D. Spink, G. Cameron, P e r s o n a l Interview. 29. N. Hacking, "U.S. P o r t Squabble Vancouver's Gain", The P r o v i n c e , Aug. 28. 1970. p. 1+ 30. S. Garrod, G.F. F r o n t a i n , C F . Crook, A.G. Thomson, J . Shaw, G. Payne, P e r s o n a l I n t e r v i e w s . 31. N. Hacking, " C o n t a i n e r Dock R o l l s a t Royal C i t y " , The P r o v i n c e , A p r i l 7, 1971. p. 17. 32. i b i d . 33. "Hapag-Lloyd Announce New P a c i f i c Coast S e r v i c e " , Harbour and S h i p p i n g , Jan. 1971. p. 79. 34. "New C o n t a i n e r s h i p Launched i n ScanStar J o i n t S e r v i c e " , Harbour and S h i p p i n g , Jan. 1971. p. 27. 35. G. Cameron, P e r s o n a l Interview. 36. See Tables 3.19 and 3.20. 3?. J.R. Immer, op_. c i t . , 19°7 c f . J.R. Immer, C o n t a i n e r S e r v i c e s on the A t l a n t i c 1970, Work Savi n g I n t e r n a t i o n a l , Washington, D.C. 1970. p. 174. 38. " C o n t a i n e r P o r t s " , S h i p p i n g World and S h i p b u i l d e r , Jan. 1970. pp. 111-121. 39. Rees, op_. c i t . , 1969. P« 39. 40. R.F. Church, Background Note on the Development of C o n t a i n e r i z e d I n t e r n a t i o n a l S h i p p i n g , The T r a n s p o r t a t i o n Center, Northwestern U n i v e r s i t y , 1968. p. 1. 41. R.G. Gibbens, " C o n t a i n e r R e v o l u t i o n Ahead of Schedule", Canadian Business, Aug. 1970. pp. 38-42. 42. i b i d . 43. "What Comes A f t e r C o n t a i n e r s " , The Economist, Jan. 7. 1967.. p. 50. 44. C o n t a i n e r s , P a l l e t s , and Other U n i t i z e d Methods f o r the  Intermodal Movement of F r e i g h t ; A p p l i c a t i o n to Developing C o u n t r i e s , Department of Economic and S o c i a l A f f a i r s , P u b l i c a t i o n No. ST/ECA/120, United Nations. 1970. p. 49. 45. N. Hacking, "2nd Big Collier In", The Province, Oct. 15, 1970. p. 31. 46. "Matson Cites Imbalance in Shipping", The Star-Bulletin, May 20, 1971. 47. Esra Bennathan, and A.A. Walters, The Economics of  Ocean Freight Rates, New York. 1969. pp. v i - v i i . cf. "Warning A l l Shipping", The Economist, Feb. 27, 1971. 48. op_. c i t . , ST/ECA/120, United Nations. 1970. p. 49. 49. "Containerizationt How Ship Operators are Making It Pay", Marine Engineering/Log, June 15, 1966. pp. 67-70 50. R.E. Howell, "Containerization 1970. The Dangers and Opportunities", Distribution Worldwide, March 1970. pp. 49-52. 51. op_. c i t . "Containerization. . . . . " , Marine Engineering/ Log, June 15, 1966. pp. 67-70. 52. Church, ttp_. c i t . , 1968. p. 1. 53. .££• _cit. ST/ECA/120, United Nations. 1970. p. 48. 54. "There are Ways of Measuring the Speed of Change", Canadian Transportation and Distribution Management, Oct. 1970. p. 17. 55* "New Maritime Program's Success Depends on Shipper, Labor Attitude", Traffic Management and Physical Distribution, Apri l 1970. p. 16". ~ 56. C. Crook, A.G. Thomson,'f Personal Interview. 57. ibid. 58. "Foreign Railroads...the Innovators", Distribution  Worldwide, Jan. 1970. pp. 40-42. 59. ibid. 60. B. Wright, "Britain's Freightliner Success Prompts New Attitudes", Canadian Transportation and Distribution Management, Oct. 1970. pp. 30+ 61. op. c i t . , Distribution Worldwide, Jan. 1970. pp. 40-42. 62. J.A. Grygiel,."The Land Bridge and Its Impact on United States Land Transportation", Paper presented to 48th Annual Meeting of the Committee on Freight Transportation Economics, The Highway Research Record, #281. "Use of Containerization in Freight Transportation", Highway Research Board/National Research Council, Public #1658, Washington, D.C. 1969. pp. 17-21. 63. op_. c i t . , Advertising literature White Pass and Yukon, PP. 1-3. cf. G. Payne, "The Container Way", Speech to the Institute of Naval Architects and Marine Engineers, Vancouver. April 23, T __ I _ _ _ _ . 64. G. Frontain, Personal Interview. 65. Immer, p_p_. c i t . , Container Services on the Atlantic, 1970. pp. 79-81. 66. i b i d . , p. 82. 67. "A Research Base for Development of a National Containerization Policy", Phase I of a Report to The Canadian Transport Commission prepared by Matson Research Corporation, San Francisco. July 1970. p. 95* 68. " C P . Rail Orders 200 Container Flatcars", Harbour  and Shipping, Oct. 1970. p. 604. 69. "CNR Order Flatcars for Container Transport", Harbour  and Shipping, Oct. 1970. p. 626. 70. C.Crook, A.G. Thomson, Personal Interview, cf. op_. c i t . , CTC Study, p. 95. 71. "CN Flatcar Centre-Sagger", The Province, May 27, 1971. p. 29. 72. "Piggyback...", Distribution Worldwide, Guide Issue, Aug. 1970. pp. 4-19. cf. "Freight Equipment", The Official Railway Equipment Register, Transportation Department of C P . Rail , Oct. 1, 1970. 73. "Where is Containerization Leading?", Far East Trade  and Development, July 1970. pp. 344-348. 74. ibid. 75. J. Tinbergen, "The Scope and Methodology of Forecasting for Shipbuilding and Shipping — Structural Development and Cyclical Movements", Lecture delivered to The International  Symposium on Middleterm and Longterm Forecasting for Shipbuilding  and Shipping, Stichting Maritieme Research, The Hague. June 16-18, 1970. pp. 27-3^. 76. H.J, Molonaar, "productivity of Shipping Space", Lecture delivered to The International Symposium on Middleterm  and Longterm Forecasting for Shipbuilding and Shipping, Stichting Maritieme Research, The Hague. June 16-18, 1970. pp. 153-178. 77. ibid. 78. Containerization> The Key to Low Cost Transport, Report for the British Transport Docks Authority, London. June 1967. pp. 14. 79. "Britains Foreign Trade", Report by the Martech Consultants, for the Port of London Authority, 1966. Cited in M.F. Tanner and A.F. Williams, "Port Development and National Planning Strategy", J. Transport Economics and Policy, Sept. 1967. pp. 315-324. 80. The President of Interpool noted thatt "50$ of a l l export traffic in the U.S. originate(d) within 300 miles of a major port (and) more than 75$ within 600 miles. Most of some 14 States (were) outside of these ports' accessibility". See Howell, o_p_. c i t . , Distribution Worldwide, Sept. 1969. pp. ^9-53. 81. R. Robinson, "Spatial Structuring of Port Linked Flows, Port of Vancouver 1965", Unpublished PhD (Geography) Thesis, University of British Columbia. 1968. Chapter 6. 82. M.F. Tanner, and A.F. Williams, "Port Development and National Planning Strategy", J. Transport Economics and Policy, Sept. 1967. pp. 315-324. 83. N. Hacking, "Former Empress to Call During Cruise", The Province, Oct. 16, 1970. p. 26. 84. N. Hacking, "Largest Potash Cargo Loaded", The Province, Sept, 25, 1970. p. 21. cf. Hacking, o_p_. c i t . , The Province, Aug. 28, 1970. p. 1. cf . Hacking, Portland Loses Round", The Province, Oct, 20, 1970. p. 21. cf. Hacking, "China Wheat Ships to be Speeded", The Province, Oct. 28, 1970. p. 19. cf. Hacking, "Portland's Gain Our Portfs Loss", The  Province, Nov. 12, 1970. p. 3^. 85. D. Spink, Personal Interview. 86. Bennathan and Walters, op_. c i t . , 1969. p. 4. 87. "Containers Now Have Their Problems", Shipping World  and Shipbuilder, Sept. 1970. p. 1273. cf. Immer, op. c i t . , Container Services on the Atlantic  1970, pp. 174-200. 88. "Maritime Unit Studies Shippers 'Rate War* in the North Atlantic", Wall Street Journal, July, 6, 1970. 89. A.F. Schoedel, "Depressed North Atlantic Ocean Rates Seen Improving", The Journal of Commerce (New York), Sept, 17» 9170. 90. R. Basco, "Marine Agency Drops Disputed Rate Legislation", The Baltimore Sun, Nov. 22, 1970. 91. C. O'Loughlin, The Economics of Sea Transport, Pergamon Press, Toronto. 1967. p. 75. 92. P. Senior, Personal Interview. cf. Table 4.5, Table of Container Load Plans, cf. Immer, o_p_. c i t . , 1970. p. 152. cf. "Britain's Growing Container Traffic", Shipping World  and Shipbuilder, Jan. 1970. p. 137+ 93. O'Loughlin, op_. c i t . , p. 73. 94. The revenue tons used by the railways are 40 cubic feet of space or a weight ton of 2000 pounds (not a long ton). 95. J. Bess, Chartering and Shipping Terms, Baker and Howard, London. 1956"^  p. 156, p. 192. Cited in K. Studer,. "Ship Size", unpublished M.B.A. Thesis, U . B . C , Vancouver. 1969. p. 21. 96. C.F.H. Cufley, Ocean Freights and Chartering, Staples Press, London. 1962. p. 276. Cited in K. Studer, ibid, p. 23. 97. O'Loughlin, op_. c i t . , p. 73. 98. Immer, op_. c i t . , 1970. p. 178. 99. "Sea-Land's Big Boost", Distribution Worldwide, Sept. 1969. p. 7^. 100. op., c i t . , Shipping World and Shipbuilder, Sept. 1970. p. 1273. 101. "Nuclear Container Ships 1 Are the Costs Right", New Scientist, Feb. 3» 1969. P- 336+ 102. op_. c i t . , Shipping World and Shipbuilder. Sept. 1970. p. 1273. cf. Immer, OJJ. c i t . , 1970. pp. 17^-200. 103. op_. c i t . , Distribution Worldwide, Sept. 1969. p. ?4. 104. "Economics of Bulk", Fairplay, June 25, 1970. p. 8. 105. ibid. 106. Sturmey, O J J . c i t . , pp. 35-55-cf. It is rumored that SeaLand 'breaks even' on their U.S. Government contract to serve Viet Nam, and that the cargo they pick up for the return trip from Asia to Seattle (including 2000 containers a month which are subsequently moved to Vancouver) is a l l profit. Similarly the Japan 6 are thought to be approximately breaking even on the Japan-to-North America haul (80$ utilization) with the 70$ util ized back-haul of pulp, malt, and ores being 'gravy'. C. Crook, A.G. Thomson,"- K. Cox, P. Senior, Personal Interviews. 107. "Container Pricing in Disarray; New Rate Structures S t i l l Resisted", Traffic Management' and Physical Distribution, March 1970. p. 19. 108. "Containerization", Canadian Shipping and Marine  Engineering, Feb. 1970. pp. 19-25. 109. P. Senior, Personal Interview. 110. Immer, op_. c i t . , 1970. p. 1?4. 111. "Matson Tries 40-Footers", Distribution Worldwide, Sept. I969. p. 70. 112. "Common Carrier Capabilities", Transportation and  Distribution Management, March 1970. p. 27. 113. Immer, O J J . c i t . , 1970. pp. 175-176. See the discussion of Associated Container Lines new container ships. "A Port for A l l Seasons", Canadian Shipping  and Marine Engineering, June 1970. pp. 26-28. cf. op_. c i t . , Port of Sydney, March 1970. p. 42. 114. Immer, op_. c i t . , 1970. p. 1£4. 115. "Container Leasors", Distribution Worldwide, Sept. 1970. pp. 58-59. 116. O J J . c i t . , Canadian Transportation and Distribution  Management, Oct. 19707 p. 16. 117. "Order Books Grow Even Faster; Massive Increase in Bulk Carrier Contracts", Fairplay, Feb. 25, 1971. pp. 27-28. 118. "Fourth Quarter Shipbuilding",, Fairplay, Feb. 4, 1971. pp. 25-27. 119. OJJ. c i t . , "Order Books Grow Even Faster.. ." , Fairplay, Feb. 25, 1971. p. 28. 120. op_. c i t . , Distribution Worldwide, Sept. 1970. pp. 58-59* 121. OJJ. c i t . , McKinsey and Company Report, 1967. pp. 12-15. 122. op_. c i t . , S h i p p i n g World and S h i p b u i l d e r , Sept. 1970. p. 1273. c f . " C o n t a i n e r i z a t i o n Enables S h i p p e r s to Show Decreased C o s t s , Higher F r e i g h t Volumes", The Toronto Globe and M a i l , Oct. 15, 1970. p. BI. c f . Hacking, oj>. c i t . , The P r o v i n c e , Nov. 28, 1970. p. 26. 123. i b i d . 124. "Meeusen I n t e g r a t e d Systems f o r Automated C o n t a i n e r H a n d l i n g " , F a i r p l a y , June'4, 1970. p. 42+ 125. i b i d . 126. "Geometric Ram Bows", F a i r p l a y , Aug. 27, 1970. p. 31. 127. op_. c i t . , New S c i e n t i s t , Feb. 13, 1969. p. 336. 128. " S h i p b u i l d i n g Research: New P r o p e l l e r Research", F a i r p l a y , Aug. 27, 1970. p. 47. 129. i b i d . 130. R.E. Howell, "Growth and Problems of C o n t a i n e r i z a t i o n " , D i s t r i b u t i o n Worldwide, Sept. 1970. pp. 37-41. 131. Immer, op_. c i t . , 1970. p. 180. 132. Howell, op_. c i t . , D i s t r i b u t i o n Worldwide, Sept. 1970. pp. 37-41. 133. i b i d . 134. Immer, op_. c i t . , 1970. p. 188. 135. i b i d . 136. O'Loughlin, op_. c i t . , p. 116. 137. i b i d . , p. 112. 138. i b i d . , 139. i b i d . , p. 113. 140. i b i d . , p. 116. 141. "Transhipment i n the S e v e n t i e s ; A Study o f C o n t a i n e r T r a n s p o r t " , A Report on the Comparison o f Costs o f C o n t i n e n t a l and U n i t e d Kingdom P o r t s , Prepared f o r the N a t i o n a l P o r t s C o u n c i l (U.K.) by A r t h u r D. L i t t l e L t d . , London. 1970. 142. i b i d . , p. 15. 144. ibid. 145. ib id . , p. 20. 146. ib id . , p. 9. 147. ib id . , p. 45. 148. The Cunard Shipping Line aims to obtain a 15$ return on investment, although companies in "the Australian and New Zealand trades commonly bargain on the basis of achieving a 10$ return". Gross return on capital for the industry rose from 4.6$ in the f i rs t quarter of 1970 profits to 12.6$ in the last quarter. However Cunard reported a loss of £ l.9 million for the year. This loss was totally unexpected as the Company had earned £3*1 million in 1969 after tax. op_. c i t . , The  Economist, Feb. 27, 1971. p. 82. 149. O'Loughlin, op., c i t . , p. 116. 150. op_. c i t . , ST/ECA/120, United Nations. 1970. p. 17. cf. Bennathan and Walters, op., c i t . , 1969. 151. O'Loughlin, op_. c i t . , 1967. p. 115. 152. OJJ. c i t . , New Scientist, Feb. 13, 1969. p. 336. 153. "Developments in London", Fairplay, July 16, 1970. pp. 32-33. 154. N. Hacking, "Crane Stands Mostly Idle", The Province, July 22, 1970. p. 16. 155» "New York's Construction Program", Fairplay, Jan. 28, 1971. p. 10. 156. Tobin, OJJ. c i t . , The Westsider, Fall 1969. p. 18. This seems to be an understated, but often quoted figure. Mr. D.L. Glickman of the PNY (Economics Dept.) on Dec. 5, 1968 noted that he was responsible for forecasts leading to spending by the Port Authority of $150 million, but " in the short span of five years, we...found that our assumptions were much too pessimistic, that the actual developments...ran far ahead of our expectations, and we were required to undertake a . . . re-evaluation; we were forced to accelerate the port development program...The whole pace of our development has changed...over the past five or six years". Taken from comments made after "Research and Forecasting for Container Faci l i t ies" , Lecture by D.L. Glickman to Colloquium on Investment Planning for Ports  and Airports, T.D. Heaver, editor, Monograph No. 4., Faculty of Commerce and Business Administration, U . B . C , 1970. pp. 19-32. 157. In 1967, Stig Axelson in The Seaport, Cited in op. c i t . , ST/ECA/120, United Nations. 1970. p. 16. gave details on 25 ports in Europe, North America, Japan, and Australia. He increased this number to 31 ports in 1968 in "Container Facil it ies at Ports Throughout the World", Lecture presented before The International Container Symposium, London. 1968. pp. 21-43. For a very concise up-to-date summary of 12 leading V/estern European ports see Canadian Transportation  and Distribution Management, October 1970. pp. 35-36. Similarly, Immer, op. c i t . , 1970. presents a summary of the extent of involvement of American steamship companies in containerization of the Atlantic Trades, pp. 174-200. 158. "Shipbuilding and Shipping in Japan Today", Fairplay, June ©, 1970. p. 67. 159. "Sea-Land's New Rotterdam Terminal", Fairplay, June 4, 1970. p. 55. 160. "Oakland to Buy Seatrain Terminal", Fairplay, Jan. 7, 1971. p. 27. 161. W.P. Hedden, Mission. Port Development, The American Association of Port Authorities, Washington, D.C. 1967. p. 16. 162. Hacking, op_. c i t . , The Province, July 22, 1970. p. 16. 163. Stig Axelson, "Container Facil it ies at Ports Throughout the World", International Container Symposium, London. 1968. pp. 21-4"9*. 164. OJJ. c i t . , McKinsey and Company Report, 1967. p. 37. 165. Axelson, OJJ. c i t . , International Container Symposium, 1968. pp. 21-49. 166. N. Hacking, "Matson Line Sails from the Crowd", The Province, Aug. 6, 1970. p. 18. 167. N. Hacking, "Furness Bows Out", The Province, Nov. 28, 1970. p. 26. 168. "Trouble at Britain's Front Door", The Economist, Nov. 7-13, 1970. p. 70. 169. Hacking, op_. c i t . , The Province, July 22, 1970. p. 16. 170. Axelson, -op_. c i t . , International Container Symposium, 1968. pp. 21-49. 171. J .E. Opheim, "Containerization in the Seventies'/, Address to the Proceedings of the Canadian Transportation  Research Forum, Vancouver. March 20, 1970. pp. 1-8. 173. T. Thorburn, Supply and Demand f o r Water T r a n s p o r t a t i o n , Stockholm, i 9 6 0 . C i t e d by R.O. Goss, "Toward an Economic A p p r a i s a l of P o r t Investments", J . T r a n s p o r t Economics and  P o l i c y , Sept. 1967. pp. 249 -272. 174. "Portburyt Reasons f o r the M i n i s t e r ' s D e c i s i o n Not to A u t h o r i z e the C o n s t r u c t i o n o f a New Dock a t P o r t b u r y B r i s t o l ' , H.M.S.O. 1966. Sept. 1967. pp. 249 -272. c f . Bennathan and Walters, op_. c i t . , 1969. 175. "The Turn-around Time of S h i p s i n P o r t " , oi- - c:;t-« ST/ECA/97, U n i t e d N a t i o n s . 1967. 176. op_. c i t . , McKinsey and Company Report, 1967. p. 57. 177. One o f f i c i a l o f the Waterside Workers F e d e r a t i o n c l a i m e d the number of waterside workers would be " h a l v e d i n a few y e a r s " . A second o f f i c i a l suggested a r e d u c t i o n from "21 ,000 to 1 3 , 0 0 0 i n t e n y e a r s " . E x c e r p t s from "Report on Marine C o n t a i n e r s " , I n t e r n a t i o n a l Workers F e d e r a t i o n , Dec. I966. C i t e d i n op_. c i t . , ST/ECA/120, U n i t e d N a t i o n s . 1970. p. 5 1 , 178. O'Loughlin, OJD. c i t . , p. 114. 179. Goss, op., c i t . , "Turnround o f Cargo L i n e r s and I t s E f f e c t on C o s t s " , J . T r a n s p o r t Economics and P o l i c y , J a n . 1967. pp. 75-89. c f . R.O. Goss, "Turnround and Costs of C o n v e n t i o n a l Cargo L i n e r s ; U.K. - I n d i a Route", J . T r a n s p o r t Economics and  P o l i c y , Jan. 1970. pp. 5 5 - 6 5 . c f . "The Turn-around Time of S h i p s , i n P o r t " , ojo. c i t . , ST/ECA797, U n i t e d N a t i o n s . I 9 6 7 . 180. Immer, op_. c i t . , 1970. pp. 149-159. c f . " C o n t a i n e r s , P a l l e t s , . . . " , op_. c i t . , ST/ECA/120, U n i t e d N a t i o n s . 1970. p. 39. 181. " C o n t a i n e r s , P a l l e t s , . . . " , op., c i t . , ST/ECA/120, U n i t e d N a t i o n s . 1970. p. 22. 182. J . Methven, " C o n t a i n e r i z a t i o n i n the S e v e n t i e s " , P a n e l D i s c u s s i o n , Proceedings of the Canadian T r a n s p o r t a t i o n  Research Forum,,Vancouver. March 20, 1970. pp, 9-11. c f . " C o n t a i n e r s , P a l l e t s , . . . " , op., c i t . , ST/ECA/120, U n i t e d N a t i o n s . 1970. pp. 22=23. I 8 3 . Sturmey, op. c i t . , I n t e r n a t i o n a l Symposium on  F o r e c a s t i n g . . . , 1970. pp. 3 5 - 5 5 * 184. "Airships Resurgent", Fairplay, July 23, 1970. p. 35. In a review of Airships Make-Sense, Maxmillian Rynish suggests that in the next 10 to 15 years airships may be used to carry up to 40 ISO van containers at speeds of 100 mph. cf. G.E. Kristensson, "Future of Containerships", Paper presented before the Eastern Canadian Section of the Society  of Naval Architects and Marine Engineers. It was suggested in this paper that in 10 to 15 years completely unmanned (Container Air Bubbles) ships may be crossing the Atlantic as freight transport equipment. Canadian Shipping and Marine  Engineering, May 1969. pp. 28-29. 185. Immer, op_. c i t . , 1970. pp. 149-150. 186. ib id . , p. 152. 187. Immer's data is in agreement with that presented in "Britain's Growing Container Traffic", Shipping World and  Shipbuilder, Jan. 1970. p. 137+ 188. Immer, op_. c i t . , 1970. p. 152. 189. Clapham, op_. c i t . , Panel Discussion, Vancouver. March 20, 1970. pp. 4. 190. Table 3.19 for Tons per Container for Imports on Vessels of Japan 6. 191. Clapham, op. c i t . , Panel Discussion, Vancouver. 1970. p. 4. 192. "Canada-Japant A Rising Sun on Trade", Canadian  Business, Aug. 1970. pp. 20-30. 193. L» Carlyle, G. Payne, P. Senior, J. Shaneman, Personal Interviews. cf. "Fact Sheet" published by the National Harbour's Board describing the Container Terminal (see Appendix V). cf. "The Container Way", Advertising literature, Empire Stevedoring Co. Ltd. , Vancouver. Apri l 1971. cf. Payne, op_. c i t . , Speech to the Institute of Naval  Architects and Marine Engineers, Vancouver. April 23, 1971. 194. J. Cashman, "What Lloyd's Register of Shipping Has to Offer to the Shipping Community Statistically", Lecture to The International Symposium on Middleterm and Longterm Fore- casting for Shipbuilding and Shipping, Stichting Maritieme Research, The Hague. June 16-18, 1970. pp. 130-152. 195. "Maritime Transport of Unitized Cargo", National Academy of Science-National Research Council, Pub. No. 745, Washington, D.C. 1959. p. 28. cf. "Inland and Maritime Transport of Unitized Cargo", National Academy of Science-National Research Council, Pub. No. 1135* Washington, D.C. 1963. p. 55. cf. "Containers, Pa l le t s , . . . " , op_. c i t . , ST/ECA/120, United Nations. 1970. p. 14. 197. Consolidated F r e i g h t Lines have r e c e n t l y acquired a 51$ i n t e r e s t i n the P a c i f i c Far East Line f o r $25 m i l l i o n . On Oct. 1, 1970 the PFEL took over Matson's former Far East route and the two large c o n t a i n e r s h i p s under c o n s t r u c t i o n i n the E a s t e r n U . S . A . In June 19711 PFEL took d e l i v e r y of the f i r s t of t h e i r s i x LASH v e s s e l s . These LASH v e s s e l s w i l l have 5°$ more c a p a c i t y than the ships being r e p l a c e d , and w i l l reduce average voyage time from 70 to 39 days. See "Trucker Takes To Sea And A i r " , and "The Truckers Ocean Going P a r t n e r " , Business Week, Oct. 3, 1970. pp. 46-48. 198. C o n t a i n e r i s a t i o n I n t e r n a t i o n a l ; 1970 Yearbook, N a t i o n a l Magazine Co. L t d . , London. 1969. p. 2~3Ti 199' op_. c i t . . CTC Study, 1970. p. 180. 200. For a d i s c u s s i o n of the problems encountered by L a b o r ' s r e f u s a l to work c o n t a i n e r s h i p s at T i l b u r y Docks see Chapter V of t h i s study. c f . For a d i s c u s s i o n of the ef fects of p o l i t i c a l i n t e r -ference by the U.S. F e d e r a l Maritime Commission and the Port of P o r t l a n d see the f o l l o w i n g ; Hacking, op_. c i t . , The P r o v i n c e , Aug. 28, 1970. p. 1. N. Hacking, "Containers Whizzing", The P r o v i n c e , Oct. 9» 1970. p. 22. N. Hacking, "Upstart Container V i c t o r y " , The P r o v i n c e , Nov. 4, -1970. p. 15. Hacking, op_. c i t . , The P r o v i n c e , Nov. 12, 1970. p. 34. N. Hacking, "Container C a l l s Restored", The P r o v i n c e , Nov. 26, 1970. p. 25. 201. To avoid bankrupcy, the P o r t . o f L i v e r p o o l 'wrote down' about o n e - t h i r d of the c a p i t a l debt of £ 84,000,000 and deferred the maturity date on e x i s t i n g stock and bonds f o r an a d d i t i o n a l two y e a r s . "Merseyside and N.W.* Confidence R e t u r n i n g " , F a i r p l a y . Jan. 7, 1971. p. 77. OVERLAND COMMON POINT TARIFFS AND TRAFFIC OVERLAND COMMON POINT TARIFFS Ocean tariffs, published by the steamship lines and conferences operating on Pacific Ocean trade routes from Australia, New Zealand or Asian countries to the North American West Coast ports are divided into two c l a s s e s » (1) Local rates; (2) Overland Common Point (OCP) or Overland Common Territory Rates. The rate applied to any particular shipment is determined by the origin, destination, and inland carrier for the goods involved, providing that the movement occurs within the guidelines established in the respective ocean and inland carriers' tariffs. Both of the above mentioned tariffs are ocean carrier tariffs and they should not be confused with railroad or motor carrier tariffs, which may have similar names. These tariffs apply to shipments through both Canadian and United States West Coast ports, although the details of the tariffs are not necessarily identical. In addition, the ocean and inland carriers absorb the terminal charges when certain conditions are met. T r a f f i c to OCP t e r r i t o r y must originate i n designated areas, be off-loaded at West Coast ports, and be transferred by approved inland c a r r i e r s to OCP destinations. In Canada, these are east of the Manitoba-Saskatchewan border; and i n the U.S., east of a l i n e formed by the eastern boundary of Montana, Wyoming, Utah, and Arizona and the common boundary between Wyoming and Colorado (see Map J.l f o r OCP destination t e r r i t o r y ) . Cargo f o r destinations west of these l i n e s would be classed as Local, even though the cargo met a l l other q u a l i f i c a t i o n s f o r the OCP t a r i f f . While the f i n a l destination i s a necessary requirement, i t i s also necessary to state the o r i g i n of the cargo. In general, OCP ocean rates apply only to t r a f f i c o r i g i n a t i n g o west of the 170 meridian West longitude, and east of the o 30 meridian East longitude. B a s i c a l l y t h i s includes the area west of a l i n e drawn through the Hawaiian Islands and the Berring S t r a i t , and east of a l i n e through Lenningrad, Istanbul, Alexandria, and Johannesburg. However a l l points i n 1 Oceania, except the Hawaiian Islands, w i l l q u a l i f y , (see Map 3 .2 f o r OCP o r i g i n areas) APPROVED CARRIERS AND PORTS To q u a l i f y f o r OCP rates, three further conditions are that cargo being imported must MAP 3.1 LOCAL and OVERLAND COMMON POINT TERRITORY O N T A R l i ^ QUEBEC DESTINATIONS S f 1 PACIFIC LOCAL^TERRITORY OVERLAND- COMMON POINT TERRITORY 'Durban \ J] Tokyo PusantJ <4.>.?Nagoya Nagasaki «ft Osaka Hong \ Hawaiian Islands Colombo Singapo East ORIGIN AREAS FOR TRAFFIC- MOVING TO  OVERLAND COMMON POINT CENTERS 30° E - 1?0° W / 180° / 170°/ We / / (2) at approved ports, and (3) then "must move via and on Bi l l s of Lading or Waybills 2 issued by...approved inland carriers". The major Canadian ports involved are Vancouver, New Westminster, Victoria, and Prince Rupert. Seattle, under a different, but similar, agreement also qualifies as an approved port for movement of Canadian OCP cargo. The approved (Canadian) inland carriers are the two transcontinental railways, (CNR, CPR), the two transcontinental airlines (Air Canada and Canadian Pacific Air ) , and since October 1970," the motor carriers who are members of the Pacific 3 Import Tariff Association (PITA). However a distinction exists with the motor carriers moving OCP cargo in "that they do not qualify for the partial absorption of the terminal charges by the steamship lines". The significance of this point wil l be discussed in Chapter IV. The U.S. railways are not included as approved carriers for Canadian cargoes, but cargo wil l qualify for the OCP rates and Canadian Railway terminal absorptions, i f i t is moved to Vancouver for subsequent shipment east by a Canadian railroad. If the traffic is moved east from Seattle via a U.S. railroad, i t wil l not qualify for any terminal absorptions, but i t does qualify for the OCP (ocean) rates, i f its destination is in 5 OCP territory. UNITED STATES Rate Structure The idea of Overland Common Point rates can probably be traced to the early U.S. Transcontinental Railroad rate structure. These class and (later) commodity rates have been modified and altered over the past 70 years, resulting in the current rate structure. Originally a l l rates were point-to-point class rates. However, as the r a i l network increased (in mileage and number of companies), i t became the usual practice (indeed almost necessary) to group 'distance-related* destination cities together in a zone and refer to a l l as Common Points, for freight shipments originating from a single point. It was not long before the same grouping procedure was being followed with the points of origin. Fourth Section Provisions A l l rates, were subject to the long-and-short-haul provisions of the U.S. Transportation Act under which carriers were subject to penalties i f the quoted rates to a more distant point were less than to an intermediate point. Similarly, Section 4 of the Interstate Commerce Commission (ICC) Act forbade carriers charging more for (a) a through haul, than (b) the sum of the local rates for the aggragate parts of the haul, without ICC permission. Generally carriers protected themselves by stating that the lower of (a) or (b) would apply. Class and Commodity Rates The early U.S. Railroad tariff structure was based on 'classes* of goods with the rates related to distance. Each class had a rating of 'X<fo' of the ' f i rs t class' tariff ranging from 35$ to 400$, with ratings also listed for carload, less-7 than-carload, and any-quantity shipments. As the volume of particular goods being shipped increased, the use of commodity rates became general. Originally, with only one railroad serving the U.S. West coast (with terminals only at the ports of San Francisco and Oakland), no problems with the terminal rate structure were encountered. Later more terminals became functional, and not a l l of these were actually on the seacoast (e.g. San Jose). Rates to a l l termini were kept the same, however because intercoastal water rates were identical regardless of harbor, and the ocean carriers absorbed the Local freight rate from 8 the actual port to the 'inland port*. Railroad commodity 9 rates, authorized by the ICC between these coastal 'ports' and eastern points, were less for many years prior to the opening of the Panama Canal, than the rates between these same eastern centers and intermountain cities. canned goods, asphaltum, dried fruits, and wine), began moving by water at the expense of the r a i l carriers. After hearings, the ICC permitted the installation of low carload rates from Pacific to Atlantic ports in order that the railroad would compete for this traffic on a co-ordinated 10 railroad-inland-and-Gulf-waterway movement. In 1916 (with the Panama Canal closed due to slides) the ICC received petitions that these 4th clause exemptions were no longer justified. After investigation, the carriers were ordered to raise rates so that they would be in strict accordance with the long-and-short haul clause. Further 4th 11 section expmptions were ordered denied. U.S. Container Rates In 1931 the ICC approved a flat 3rd class rate, based on the weight of a container and its contents (the minimum weight per container to be 4,000 lbs . ) , "with the provision that the charge should not be less than the highest carload class rate for any article in the container or less than the class rate next lower than the amount specified as an 'any-quantity* rate for any article in the container". 12 In 1932 the ICC suspended its order and ruled (apparently instead) that 'ferry trucks' be permitted to operate. This allowed goods to be transported in locked and sealed trailers or truck bodies on specially constructed flatcars, with a f l a t charge o f 300 (per cwt) f o r a minimum of 20,000 l b s . A p p a r e n t l y these r e g u l a t i o n s and r a t e s proved to be non-c o m p e t i t i v e , and c o n t a i n e r s faded'from the scene u n t i l the ICC R u l i n g o f 1954 ( d i s c u s s e d on page 95). * F r e i g h t - A l l - K i n d s ' Rates S i n c e 19^0 U.S. r a i l c a r r i e r s have been p e r m i t t e d to quote an * a l l - f r e i g h t - r a t e * o r T r e i g h t - a l l - k i n d s • (FAK) 15 t a r i f f . T h i s method of r a t e making was i n t r o d u c e d to enable the r a i l r o a d s to meet the c o m p e t i t i o n o f the motor c a r r i e r and water l i n e s . The FAK r a t e i s a charge a p p l i e d t o the weight o f a shipment without any r e f e r e n c e to the type o f commodity i n v o l v e d o r the c o n t a i n e r i n which i t i s b e i n g moved. I t i s a charge which covers a r t i c l e s o f d i f f e r e n t d e s c r i p t i o n s i n c l u d e d i n a s i n g l e consignment, without r e q u i r i n g t h a t the goods be d i s t i n g u i s h e d from one another, not t h a t the r a t e be r a i s e d and lowered i n accordance with the r e l a t i v e contents o f the shipment. The ' a l l - f r e i g h t - r a t e ' became the b a s i s o f the mixed c a r l o a d ** o r p o o l c a r r a t e , and has now been a p p l i e d to the 1.6 c o n t a i n e r and f u l l - t r u c k r a t e . These r a t e s permit the s h i p p e r G e n e r a l l y the mixed c a r r a t e has a wording s i m i l a r to Rule 100 i n the CFA-254-B T a r i f f which s t a t e s 1 "Except as otherwise p r o v i d e d , when a number o f a r t i c l e s f o r which the same or d i f f e r e n t r a t e s a re p r o v i d e d i n t h i s t a r i f f , when shi p p e d i n s t r a i g h t c a r l o a d s , are s h i p p e d a t one time by one c o n s i g n o r . . . . or the f r e i g h t f orwarder to "combine consignments and to s h i p them a t a c a r l o a d r a t e , even though each element i n the 1 7 combination i s o f f e r e d i n s m a l l amount", wi t h the c a r l o a d r a t e b e i n g t h a t o f the h i g h e s t r a t e a p p l i c a b l e to any a r t i c l e i n the combination. Daggett noted t h a t because the " a l l - f r e i g h t method of r a t e making was i n t r o d u c e d to meet the c o m p e t i t i o n of motor and water l i n e s , ( i t ) was expected t h a t r a t e p r a c t i c e s would be a d j u s t e d . . . e n a b l i n g a l a r g e r number o f s m a l l s h i p p e r s to o b t a i n the b e n e f i t s o f c a r l o a d r a t e s " . 18 While r e t a i l merchants approved, the motor c a r r i e r s and even some U.S. Government Departments o b j e c t e d on the grounds t h a t FAK r a t e s ^ "make f o r poor u t i l i z a t i o n of r a i l r o a d c a r s , and... they d i s r e g a r d the sound and t e s t e d p r i n c i p a l s o f c l a s s i f -1 9 i c a t i o n s . . . " . I n s p i t e o f o p p o s i t i o n from v a r i o u s s o u r c e s , the FAK r a t e s t r u c t u r e has s u r v i v e d , and i t has found ready acceptance 20 i n p r e s e n t c o n t a i n e r t a r i f f s i n both Canada and the U.S. However, i t seems e n t i r e l y r e a s o n a b l e to expect t h a t as the volume o f p a r t i c u l a r commodities b e i n g s h i p p e d i s i n c r e a s e d , the s h i p p e r s , c a r r i e r s and consignees w i l l agree to use the lower commodity r a t e s . to one consignee and d e s t i n a t i o n , i n a c a r l o a d , they w i l l be charged a t the a c t u a l or a u t h o r i z e d e s t i m a t e d weight a t the c a r l o a d commodity r a t e a p p l i c a b l e i n t h i s t a r i f f to each a r t i c l e . The c a r l o a d minimum weight w i l l be the h i g h e s t p r o v i d e d f o r any a r t i c l e i n the mixed c a r l o a d , and any d e f i c i t i n the weight w i l l be charged f o r a t the lowest c a r l o a d r a t e a p p l i c a b l e to any a r t i c l e i n the mixed c a r l o a d , (see E x c e p t i o n ) . E x c e p t i o n : D e f i c i t i n minimum weight w i l l be charged f o r a t the h i g h e s t c a r l o a d r a t e a p p l i c a b l e to any a r t i c l e i n the mixed c a r l o a d when such d e f i c i t exceeds 25$ o f the a c t u a l weight o f the shipment," The ICC has been involved for many years in questions relating to the legality of these services, the suitability of 21 the rates, or the status of the carriers. However, an ICC order of July 30, 1954 set forth the current legal relations, limitations, and obligations incurred when transporting highway trailers on railroad flatcars. It was competitive pressures and this order which finally stimulated, and economically permitted, carrier interest in truly co-ordinated transportation of cargo. To retain traffic, some railroads instituted a trailer-on-flatcar (TOFC) service for less-than-carload shipments, while others permitted and even encouraged, piggyback service, in place of over-the-road truck movement. The relevant points contained in the ICC order #293 ICC 93 are: "A railroad may transport its own freight in its own trailer-on-flat-car without holding any authority under Part II of the Actj The motor operation of trailers by railroad in collection and delivery service at the termini of the r a i l movement is within the partial exemption of. . .the Act; A railroad under proper tariffs and without holding any authority under Part II, may transport freight-laden trailers of motor common carriers or private carriers by motor vehicle on flat cars, the trailers having a prior and/or subsequent highway movement, but i t may not do so for contract carriers by motor vehicles A railroad engaged in TOFC service under joint-rate arrangements with some motor common carriers may refuse to enter into such arrangements with other motor common carriers since the section of the Act in regard to such arrangements (is)...permissive only: railroads and motor common carriers are connecting carriers where r a i l service is substituted for motor service; Railroads may transport freight-laden trailers on flat cars when such trailers have a prior and/or subsequent highway movement in freight-forwarder service; and railroad and freight forwarders may not establish through routes and joint rates.. . covering movement of the freight forwarder's trai ler on railroad flat car." provided by the railroads may have been due to the weather factors as much as to economies of the system. The result was that both carriers and shippers "found that co-ordinated service reduced loss and damage claims and expedited less-22 than-truckload service". In inaugurating these TOFC services, many railroads were carrying the truck body without the chassis, providing in essence, a container movement. After the ICC's 1954 order, a rapid expansion of TOFC traffic occurred, and the water carriers took steps to obtain the advantages of co-ordinated service by converting, and later building, vessels for the transport of van containers and highway trailers. CANADA Historical Development It has been the practice for many years to apply a common class rate to a l l points within the triangle formed by Sudbury, Windsor and Montreal, on the one hand, and stations in Western 23 Canada on the other. This was a direct result of the competitive factors affecting the triangle including the shorter mileages by U.S. railroad, and the favored location by which most stations could move goods by any of» (1) water (2) r a i l (3) rail-water-rail (4) water-rail. Like the U.S. railroad tariff structure, the early Canadian r a i l rates also contained a multiplicity of classes. Over time these have become modified, with the result that today most traffic moves on either commodity or agreed charge rates. Intact containers move on either a FAK or a commodity rate. Class Rates From the time of publication of the f irst Canadian Freight Classification Tariff in 1884, until 1955* the railway class rate structure has been divided into two parts: (1) the Standard Mileage Class Rates representing the maximum rates that the railroad were permitted to 24 charge, and adher^ JLng closely to the distance principle of rate making. (2) the Special Class Rates published to. meet "competitive conditions...(and) applied usually from specific large shipping points to general destinations" with rates "on a lower basis than the Standard Mileage Rates". These were eliminated 25 by the equalized class rates in 1955« In conjunction with the freight classifications, certain rate territories were established at various times between 1874 and 1955« There were three main territories comprised 26 as follows: ( 1 ) Maritime - a l l areas east of Diamond Junction and Levis, P.Q. ( 2 ) Eastern - a l l areas between Diamond Junction-Levis, Quebec, and Port Arthur-Fort William (Thunder Bay)-Armstrong, Ontario. (3) Western - a l l areas west of the Lakehead. Commodity Rates Commodity rates had also been established at various 27 dates in one of two general typest ( 1 ) mileage commodity rates - which gave rates for various mileage blocks, ( 2 ) specific commodity rates - which applied to certain individual or groups of commodities, to or between particular points. The Western Provinces, particularly Alberta, complained for many years of unequal treatment because of the lower rates generally applicable in Eastern Canada. The 1951 Royal Commission on Transportation recommended a uniform scale of mileage, class rates and mileage commodity rates. Finally on March 1, 1 9 5 5 , "standard mileage class rates, identical throughout Canada except for the Maritimes, came into effect, 28 together with a new freight classification". However "there were exceptions to equalization such as joint international ratest import and export rates related to rates through U.S. ports; competitive rates; agreed charges; rates within the Maritimes and statutory grain rates resulting from the Crow's Nest Pass Act". 29 the One and One-Third Rule which provided that "the rates to and from points intermediate to British Columbia points should not exceed by more than one-third the transcontinental 30 competitive rates to the more distant points". The competitive rates had been established to meet competition (particularly water), and the railroad evaded this rule by leaving Alberta rates unchanged, cancelling many transcontin-ental competitive rates to British Columbia, and publishing agreed charges. Import and Export Rates and Tariffs It has been Canadian Government policy for many years that import rates must "be such as wil l allow business to move from the seaboard on a reasonable basis, but...not be so low as to create a preferred basis for.. .foreign products in 31 competition.•.with Canadian produced goods". At the same time export rates must allow Canadian goods to compete in foreign markets. In accordance with this policy, commodity and class rates have been established for both import and export shipments. These class rates differ from domestic class rates in that many of the charges for services performed at the point of entry, such as loading or unloading, switching 32 and wharfage are incorporated into the tariff structure.-' This situation applies to the rates on traffic moving to OCP destinations through Vancouver, where the railways have 3 3 The import/export commodity rates, applying to those goods moving in substantial volume, have been established on a basis which reflectst (1) the rates and tariffs in effect in contiguous U.S. territory, (2) the combination of r a i l and ocean rates on goods moved via the Panama Canal. 3^  The terms of the Japan-West Canada Freight Conference Tariff (for extracts of Tariff see Appendix VI), are supposed to prohibit the movement of Canadian destination OCP traffic through the Port of Seattle, i f i t is to be forwarded via the U.S. r a i l lines ( i .e . Burlington Northern). It is also supposed to be prohibitive by cost because no carrier-absorption of terminal charges apply on traffic so moving. In addition, documentation time and customs procedures do not 35 encourage this path of freight forwarding. CANADIAN OCP TRAFFIC 36 HISTORY OF OCP RATES The history of OCP traffic in Canada begins near the turn of the century. At that time the Canadian Pacific Railway was operating steamships on the trade route between the Orient and Vancouver, and established a consultation Japan, whose members were the steamship lines that operated out of the Port of Vancouver. This resulted in the steamship lines establishing an ocean rate on cargo to Eastern Canada which, when combined with the Railway Tariffs, was competitive with that charged by vessels using the Panama Canal to New York, Halifax, and/or Montreal. The agreement provided f-or the establishment of a lower ocean freight rate between the Orient and Vancouver for cargo moving to a l l points east of the Manitoba-Saskatchewan border. In return the railways agreed to a reduction in their normal rate level between Vancouver and the eastern terminals of Toronto and Montreal. These were not and are not 'through* rates; rather they are combination rates. The combination of the OCP rates and the railway rates "were and are significant to any importer in eastern Canada, because they...provide...a dollar and cents 37 basis for...(selecting) one mode of transport over another", for imported commodities. It was noted in The Queen v. J.W. Mills & Son Ltd. et. a l . thatx "an importer had...and s t i l l has a meaningful choice... of taking advantage of these two rates and...(importing his) commodities from the...designated areas...to Vancouver and then to...Toronto or Montreal by r a i l . . . or...(having them) delivered to him by ship to New York and by truck to Toronto or Montreal, or. . .by ship directly to Montreal (or) Toronto...(He) also had the option of using air transport either directly from the Orient or from Vancouver". 38 The result is that when OCP 'origin' freight is consigned to an OCP destination, the ocean rate wi l l be reduced by $X per 39 revenue ton. This is a commodity tariff , not a Freight-All-Kinds, and the variance from the Local rate on the same commodity can range from nothing to as much as $20.00 per 40 cubic feet, depending on the commodity, (for some examples see Table 3.1 or Appendix VII) The average reduction would be in the order of $5.00 per revenue ton for traffic destined OCP, when compared with Local rates. Although there does not appear to be a definite schedule for the variances, (presumably) the conference steamship lines have determined the landed cost in Toronto via the Panama Canal and have adjusted their rates accordingly. The Judge in the Vancouver poolcar operators case noted 40 that the "eastern Canada rate was about 10 per cent less" than the rates on commodities "destined for Vancouver only, or, for transportation by non-rail f ac i l i t i e s . . . fo r points west of the Saskatchewan-Manitoba border, or for transportation by non-rail faci l i t ies to inland points". 41 An example would be the rate variance granted on dry goods. The commodity rate to Local territory is approximately $42 per revenue ton, but the OCP rate would be about $4 per revenue 42 ton less. EXAMPLES OF COMMODITY RATES  CHARGED UNDER  THE JAPAN-WEST CANADA FREIGHT CONFERENCE TARIFF No. 2 ITEM LOCAL OCP RATE RATE $ $ Typewritersi Value less than $1300.00/revenue ton 42.75 39.00* more " 1300.00/ " " 55.00 51.00* Water turbines: 32.50 32.50 Cameras: Value less than $500.00/revenue ton 49.25* 46.00* more " 500.00/ " " 64.75* 55.25* Linen Piece Goods and Yarn: 56.00* 50.50* Nylon and Other Synthetic Fiber: Piece Goods and Yarn 48.50* 40.75* Ramie Piece Goods and Yarn: 48.50* 42.75* Rayon Fiber: 30.00* 28.75* * These commodities are eligible for a $3.00 reduction when shiped in unitized shipments, subject to Rule 40 of the tariff . Source: Japan-West Canada Freight Conference Tariff No. 2. Effective October 1, 1970. (See Appendix VI) pp. 237, 251, 303, 304. There is , in addition, one more inducement provided by the ocean and r a i l carriers to encourage importers to use the combination of the OCP ocean and preferential r a i l rates through Vancouver. In 1925, the Canadian railroads (CPR,CNR) followed the pattern established earlier by the American railroads, and signed a rail-water agreement with the steamship lines in which the carriers consented to absorb the terminal charges of handling, wharfage and carloading that would normally be assessed by the steamship companies, docks, and railroad companies. The original agreement, in effect from 1925 to October 1, 1970, provided that the wharfage charges would be shared 5 0 $ by each of the steamship and railway-companies, while the steamship lines would absorb 100$ of the vessel unloading handling charges, and the railways would absorb 100$ of the r a i l carloading charges. This absorption practice, of course, would only apply to cargo coming from OCP origin areas which moved through Pacific Coast ports and did, in fact, move to OCP destinations on the Canadian railways (the ^approved' inland carriers). On October 1, 1970, this agreement was altered. The steamship lines, including both members of the Japan-West Canada Freight Conference and some non-conference lines, agreed to absorb 6 0 $ of the terminal charges v/ith the approved inland carriers ( i .e . CNR,CPR) absorbing 40$ of the terminal charges. More specifically, on "freight which is drayed to portion of wharfage, handling and car loading charges up to 43 a maximum of $11.38 per 2,000 lbs ." . (This has since been 44 increased to $11.92 per 2,000 lbs.) Included in this figure is a carloading charge which the r a i l carriers wil l absorb up to a maximum of $9.00 per 2,000 lbs. , and this charge wi l l be absorbed even when the freight has been 5^ discharged at the Port of Seattle, i f its subsequent move-ment is by the Canadian railways to Eastern Canada. For many years the Canadian truckers have sought to obtain arrangements with the Shipping Conference which would be identical to those enjoyed by the railways. "Apparently in the United States the truckers have (had) the same OCP 46 privileges" as the railways for a number of years. Until the October 1970 agreement, these privileges were not forth-coming, even though this 'discrimination' had been cited in 47 court. This meant that cargo coming from OCP origin areas, imported via West Coast ports, and moving to OCP destinations would not qualify for the lower ocean rates i f i t was moved on trucks. Neither did i t qualify for any absorption of terminal charges by the steamship lines. On October 1, 1970 however, motor carriers who were members of the Pacific Import Tariff Association (PITA), were approved as inland carriers for OCP cargo. As a result, cargo now moved by truck wil l qualify for the lower ocean rate. Perhaps equally important, the revised agreement did not alter the absorption practices; the motor 48 carriers must s t i l l absorb 100$ of the terminal charges. These practices place the truck lines at a disadvantage in relation to the railroads when soliciting OCP traffic. The ocean 'leg' of the transport journey has the same 'price* into Vancouver, whether the cargo subsequently moves inland by r a i l or by truck. But because of the higher percentage of the terminal charges that are absorbed by the truckers, the inland motor carrier rate must be higher proportionally. These factors are further compounded when considering the movement of container traffic, because a l l inland carriers encounter a problem in uti l iz ing their weight and volume capacity properly, when moving cargo in intact containers. It is estimated that the cost (per hundredweight) to move containerized cargo by truck may be 75$ greater than to move the same cargo (after destuffing) in a truck trai ler. CANADIAN RAILWAY IMPORT TARIFFS The currently applicable Canadian Import Rail Tariffs to Eastern Canadian destinations for cargo moving in intact containers are« (1) CFA-263, for traffic imported through Vancouver and (2) CFA-589-A, for traffic moving through Atlantic Coast ports. (This latter traffic does not, of course, • qualify for either OCP rates or the terminal absorptions.) Since the majority of 'actual* OCP traffic moves from freight forwarders premises in Vancouver, either in railway poolcars, CFA-38-L. The r a i l tariffs discussed below are a l l classed as "Competitive Rates" which means they have been "issued to meet motor truck and/or water competition and wi l l not apply 50 from or to intermediate points'?. CFA-2 54-B Canadian Freight Association Eastbound Import Tariff No. 254-B for Import Carload Commodity Ratesj from Vancouver and New Westminster to stations in Canada east of Armstrong and ThunderBay, Ontario^, J . l o is the tariff commonly referred to as the Poolcar Tariff, and was agreed to and published jointly by the CNR and CPR. While the CFA-70-C (see below) tariff is s t i l l in effect, i t is used relatively seldom. (It is s t i l l used for American shipments, or for points not named in CFA-254-B.) If an importer had sufficient tonnage to occupy the minimum weights specified in the various 'items' he could order a car from the railroad and uti l ize CFA-254-B himself. If his tonnage was insufficient, the importer most l ikely would engage a freight forwarder, who would then consolidate this individual's shipment with that of other consignees, (who also had less than the minimum tonnage), for 51 forwarding to eastern Canadian destinations. CFA-263 Canadian Freight Association Import and Export Freight Tariff 263 is for commodities in "containers owned by other than railway or highway common carriers", with rates for empty containers. Importation must be from Vancouver to stations in Canada, and exportation from stations in Canada through Vancouver, with application of rates and charges "only to or from piers, wharves, or ocean carriers* faci l i t ies at Vancouver, 52 B.C." . As a result containers imported via port faci l i t ies in Seattle do not qualify for the rates shown in CFA-263, CFA-38-L Canadian Freight Association Tariff 38-L ; • •>.applies to motor carrier owned trailers being moved piggyback across Canada. This tariff applies only to truck trailer freight, i t does not apply to containerized freight. Therefore containers moved piggyback on truck chassis do not qualify for this tariff . However a recent Supplement to CFA-263 permits containers on chassis owned by the ocean carrier to be moved 53 eastward from Vancouver under that tariff . CFA-70-C Canadian Freight Association Eastbound Import Freight Tariff 70-C is for commodities in mixed carloads. The f irst p u b l i c a t i o n by the Canadian F r e i g h t A s s o c i a t i o n of an 5^ ammendment i n 1955 to t h e i r T a r i f f 70-A". These r a t e s p e r m i t t e d the c o n s o l i d a t i o n of two or more commodity shipments i n t o a s i n g l e r a i l c a r , because the r a i l r o a d s were r e p o r t e d l y l o s i n g t h i s b u s i n e s s to the Panama Canal-bound s h i p s . While the volume of t r a f f i c moved a t p o o l c a r r a t e s had "never been more than a s m a l l p o r t i o n " of t o t a l imports to Canada from the O r i e n t moving through Vancouver, the p u r p o r t e d reason f o r e s t a b l i s h m e n t of a mixed c a r l o a d r a t e to e a s t e r n Canada, and e s p e c i a l l y to Toronto and M o n t r e a l , was so t h a t the r a i l w a y s c o u l d r e t a i n , without r e d u c t i o n , t h e i r r a t e s f o r LCL and CL 55 shipments. The p o o l c a r r a t e s , as e s t a b l i s h e d under the o r i g i n a l 56 t a r i f f s , were c o n s i d e r a b l y lower than the CL o r LCL r a t e s , and " a t one j u n c t u r e f o r a c e r t a i n type of shipment was j u s t 57 a l i t t l e more than one h a l f of the LCL r a t e " . The r e s u l t was t h a t f o r cargo which q u a l i f i e d f o r OCP t a r i f f s , the r a i l w a y s and steamship l i n e s made t h e i r r e g u l a r a b s o r p t i o n o f t e r m i n a l charges, and the small-shipment consignee r e c e i v e d the b e n e f i t o f the lower ocean r a t e , the t e r m i n a l a b s o r p t i o n , and the p r e f e r e n t i a l r a i l r a t e . While CFA-70-C has n o t been a b o l i s h e d , the g r e a t m a j o r i t y of p o o l c a r shipments now move on t a r i f f CFA-254-B as d e s c r i b e d above. Canadian F r e i g h t A s s o c i a t i o n C o n t a i n e r F r e i g h t T a r i f f 589-A a p p l i e s to commodities i n c o n t a i n e r s owned by oth e r than r a i l o r highway common c a r r i e r s moving from the p o r t s o f Quebec, M o n t r e a l , S t . John, o r H a l i f a x . T h i s t a r i f f should be c o n s i d e r e d as an E a s t e r n p o r t s c o n t a i n e r t a r i f f as Vancouver i s c o n s i d e r e d to be "an o r i g i n o r d e s t i n a t i o n f o r c o n t a i n e r s imported o r ec p o r t e d through one of t h e . . . e a s t e r n Canadian 58 p o r t s " . A c o n s i d e r a b l e volume of break-bulk t r a f f i c c u r r e n t l y e n t e r s Canada through these E a s t e r n Canadian p o r t s from n a t i o n s with OCP " o r i g i n * d e s i g n a t i o n , and i n d i c a t i o n s are t h a t c o n t a i n e r i z e d cargo w i l l do the same i n the f u t u r e . I t i s f o r t h i s reason t h a t CFA-589-A has been i n c l u d e d i n t h i s d i s c u s s i o n . I l l TYPE OF CARGO Basically OCP tariffs relate to imported break-bulk cargo which a l l moves on a commodity rate on the high seas, regardless of whether i t is loose, palletized, or containerized. There is nothing inherent in the OCP rate which applies specifically or generally to container movement, although a reduction is given for 'unitization' (palletization) of many commodities. After i t has been discharged however, cargo moving intact in the originating container to any inland destination, whether Local or OCP, may move on a class, Freight-All-Kinds (FAK), or commodity tariff , and intact containers do receive some rate reductions, (see Chapter IV) Theoretically the intermodal movement of cargo in containers to either Local or OCP territory, should follow once the container has been off-loaded at the West Coast port. Since the current containerized OCP traffic is essentially the same as has always moved in break-bulk form, this should apply to consumer goods of the following classesJ (1) high value seasonal goods, e.g. Christmas lights, 59 Easter baskets, Halloween costumes; (2) goods of high individual piece value, e.g. tape 60 recorders, stereos, and T .V . ' s i (3) perishable goods, e.g. biscuits, onions, and fresh fruit such as apples or Japanese oranges; (4) dense commodities, e.g. snowmobile and motorcycle engines, cement, ball bearings, and some auto parts. With these items transit time is very valuable, and a late arrival could mean that the seasonal market had passed or that spoilage had begun. It also permits the consignee to maintain smaller stock inventories because 'outages* can be more quickly replaced. The time period from order placement to delivery used to be 6 weeks? even with only containerized ocean 61 delivery, this time has now been halved. CONTAINERIZABLE EXPORT CARGOES As this study deals with Overland Common Point Tariffs and traffic, only limited l y reference wi l l be made to export cargoes. However i t must be noted that the major portions of such cargoes through B.C. ports are the 'bulk* commodities of grain, coal, sulfur, potash, pulp, lumber, and metallic ores. Generally speaking these items are not suitable for contain-erization, simply because other, more efficient, means have 62 been developed for their transfer. An analysis of the exports from both Eastern and Western Canadian ports demonstrates that significant tonnages of •containerizable' cargo do exist for most nations in OCP 'origin' territory, i f their export in containers is deemed desirable, (see Table 3.2) This does not, of course, solve the problems of imbalanced or poorly co-ordinated shipping schedules. Ignoring the bulk commodities, exports of cont-MAJOR EXPORT CARGOES FROM CANADA  TO SELECTED "OCP ORIGIN" COUNTRIES  BY CANADIAN REGION  1966 to 1968 Containerizable Commodities Origin From Atlantic and From British Nation Great Lakes Ports Columbia Ports Australia Newsprint, steel Lumber, pulp, products,asbestos asbestos Ceylon Mainland China F i j i and Oceania Hong Kong India Japan Korea New Zealand Pakistan Philip-pines Taiwan Newsprint, asbestos Scrap Newsprint,autos Wheat flour,news-print, machinery Zinc and alloys, lumber Lumber, pDywood, wheat flour Non- containerizable Bulk Commodities Barley, flax, sulfur, potash Wheat Newsprint,general Wheat flour,news- Wheat, sulfur cargo, plastics print,aluminum Newsprint,wheat flour, zinc Zinc, newsprint, asbestos,iron and scrap Asbestos, news-print, chemicals Fertilizer,news- Wheat, sulfur, print,lead,zinc potash Lumber,aluminum, pulp,livestock feeds, steel Zinc,fert i l izer , lumber Cereals,soybeans, flax,rape,logs, coal,copper,iron Cereals,sulfur, flax,logs,po tash Aluminum,steel Aluminum,fertil- Sulfur,potash products,asbestos izer,lumber Fertilizer,pulp, animal o i l Newsprint, pulp, autos Scrap, asbestos, bricks Fertilizer,pulp, Wheat, sulfur zinc,animal o i l Malt,pulp,paper, newsprint Plastics, pulp, fert i l izer , zinc Cereals,sulfur, potash Wheat,rape,soy-beans, copper Sources "Shipping Report". Part 1. D.B.S. # 54-202. cf. Appendix VIII, BY CANADIAN PORT REGION 1966 - 1968 (Thousands of Tons) COUNTRY ATLANTIC AND GREAT LAKES PORTS PACIFIC COAST REGION PORTS 1966 1967 1968 1966 1967 1968 JAPAN 254.1 298,2 525.5 1668.2 1995.2 1957.4 AUSTRALIA 198.2 230.9 252.6 319.2 347.3 421.5 INDIA 91.0 131.2 47.0 100.7 178.0 173.0 NEW ZEALAND 30.7 26.8 32.3 145.1 105.3 108.0 PHILIPPINES 34.1 37.8 35.2 22.4 34.1 37.7 HONG KONG 22.3 23.6 28.9 28.9 32.3 30.1 TAIWAN 2.8 0.9 22.5 6 3 . I 37.8 39.7 Source« , Shipping Report. 1966, 1967, 1968. Part 1. D.B.S, # 54-202. ainerizable commodities (see Table 3.3 for tonnages of major containerizable exports) in 1968 amounted to almost 2 million tons to Japan from B.C. ports and another 500,000 tons from Atlantic and Great Lakes ports. Containerizable exports to Australia totaled 420,000 tons from B.C. ports and 250,000 from Eastern ports. Exports to India were 173f000 and 47,000 tons respectively while New Zealand imported 140,000 tons of Canadian containerizable goods, THE PORT OF VANCOUVER Importance The overwhelming dominance of Vancouver as the major B.C. port was demonstrated by Robinson in his analysis of port 63 linked cargo flows through 30 B.C. harbors. Table 3.4 compares the Port of Vancouver to a l l British Columbia ports on the basis of total cargo imports and general cargo unloaded from 1965 to 1970:. It shows that between one - .half and one-third of a l l cargo discharged at B.C. ports is off-loaded in the Port of Vancouver, More important from the viewpoint of this study, approximately one-third of a l l imported general cargo is discharged in Vancouver, FOR TOTAL INTERNATIONAL SEABORNE AND  FOR GENERAL CARGO UNLOADED ( Thousands o f Short Tons) 1965 - 1970 1965 1967 1968 1969 1970 ALL BRITISH COLUMBIA PORTS TOTAL CARGO DEEP SEA GENERAL CARGO 3.938 n/a 3,844 2,225 4-,235 2,810 4,511 2,625 3,315 n/a PORT OF VANCOUVER TOTAL CARGO DEEP SEA GENERAL CARGO 1,816 1,074* 1,972 1,191' 1,777 742 weight or measure tons 2,278 806 1,849 820 Source: S h i p p i n g S t a t i s t i c s . (Monthly) DBS. # 54-002. Ottawa. 1967-1970 S h i p p i n g Report. DBS. # 54-202. P a r t I. Ottawa. 1965 - 1968. N a t i o n a l Harbours Board. Vancouver, B.C. THROUGH THE PORT OF VANCOUVER 1962 - 1970 (Thousands of Short Tons) 1962 1963 1964 1965 1966 1967 1968 1969 1970 IMPORTS 1,020 916 1.171 1,816 1,869 1,972 1,777 2,278 1,849 EXPORTS 6,458 8,482 10,321 9»^78 10,703 11,153 12,113 11,240 16,931 j Imports ^ Exports 16$ 11$ 12$ 19$ 17$ , 18$ 15* 20$ 11$ Source* National Harbours Board, Vancouver, B.C. As shown in Table 3«5» "the majority of cargo moving through the Port of Vancouver i s export-bound. Total volume in 1970 was the greatest on record. Exports were more than double the tonnage of 1963, with the largest single year-to-year growth occurring in 1970. Import tonnages have also risen significantly since 1963, but no consistent growth has been evident since 1965* Vancouver's dominance of a l l B.C. ports i s further-il l u s t r a t e d in tonnage terms in a comparison of the Ports of Vancouver and New Westminster (the two busiest Canadian West Coast ports) by quarterly data for the years 1967-1970 on a basis of 'O.ther' cargo unloaded. (see Table 3.6) The data shows that Vancouver handles from 7 to 10 times the tonnage of i t s nearest competitor annually. However, as shown in Table 3»7 significant portions (up to 50$) of 'general cargo' are really 'bulk* commodities such as asbestos, bauxite,•salt, and sugar. While physically containerizable, these are not prime container cargo. Perhaps i t i s significant to note that the volume of general cargo imports classed as 'Other' (which can be economically containerized) has not shown any significant growth in the last 3 years. This may well be a reflection of the increase in containerized imports moving through the Port of Seattle, or of diversion to Eastern Canadian ports. SeaLand estimated that by late 1971, their company alone had diverted approximately TONNAGE OF ALL INTERNATIONAL SEABORNE CARGO CLASSED AS "OTHER COMMODITIES" UNLOADED BY MAJOR PORT IN B. C. 1967 - 1970 ( Q u a r t e r l y ) (Thousands of Short Tons) PORT of IMPORT Vancouver New West-m i n s t e r Vancouver New West-m i n s t e r Vancouver New West-minster.' Vancouver New West-m i n s t e r F i r s t Q uarter 329.8 41.2 343.0 5^.3 392.2 87.2 367.9 45.8 Second Quarter 1262 369.0 29.0 1968 376.9 37.6 19_6£ 475.6 72.4 1970 274.1 52.4 T h i r d Quarter 345.4 41.5 720.9 52.0 379.8 40.5 295.3 37.5 Fourth Quarter 519.6 40.6 514.4 53.5 352.7 47.6 449.0 20.9 Y e a r l y T o t a l 1563.8 152.3 1955.3 197.^ 1600.2 247.7 1386.3 156.6 Source: S h i p p i n g S t a t i s t i c s . (Monthly) DBS. #54-002. Queens P r i n t e r . Ottawa. 1967, 1968. 1969, 1970. THOUSANDS OF SHORT TONS OF GENERAL CARGO  UNLOADED AT BRITISH COLUMBIA PORTS BY SELECTED MAJOR COMMODITY GROUP Commodity Group Asbestos Bauxite S a l t Sugar Other Asbestos Bauxite S a l t Sugar Other Asbestos B a u x i t e S a l t Sugar Other Asbestos Bauxite S a l t Sugar Other F i r s t Quarter 20.2 125.1 68.0 3^.7 240.8 24.4 206.9 86.8 32.0 320.8 36.0 221.4 88.6 28.5 364.1 35.9 192.3 106.5 16.7 289.4 1967 - 1970 ( Q u a r t e r l y ) Second Quarter T h i r d Quarter 1967 22.6 92.9 76.2 16.4 368.9 1968 33-5 75.3 93.9 16.8 290.4 1969 28.0 96.3 116.5 4.7 443.5 1970 50.3 127.'9. 10.3 286.8 16.3 116.7 79.8 34.4 312.3 30.3 119.7 91.2 31.8 649.0 44.6 170.6 73.2 16.8 344.7 25.3 21.5 148.8 17.1 275.9 Fourth Quarter 25.6 97.2 81.2 38.9 351.9 37.1 119.3 85.9 11.8 454.7 27.1 122.8 76.3 16.8 309.5 36.0 54.2 94.7 67.6 292.6 Y e a r l y T o t a l 84.7 431.8 305.2 124.4 1273.9 125.2 521.1 357.8 92.4 1714.8 135.7 611.1 354.6 66.8 1461.9 147.5 395.9 350.0 111.7 1144.7 Source: S h i p p i n g S t a t i s t i c s . (Monthly) I n t e r n a t i o n a l Seaborne S h i p p i n g . DBS. # 54-002. Queens P r i n t e r . Ottawa. 1967, 1968, 1969, 1970. to the P o r t o f S e a t t l e . These 3 5 - f o o t c o n t a i n e r s then moved v i a B u r l i n g t o n Northern R a i l r o a d to Vancouver f o r subsequent 64 d i s p o s i t i o n . VOLUME OF OCP CARGO MOVED TO EASTERN CANADA No data i s a v a i l a b l e but p r a c t i c t i o n e r s g e n e r a l l y agreed w i t h the estimate t h a t the volume of OCP t r a f f i c through 6 5 Vancouver would t o t a l about 2 5 0 , 0 0 0 tons per year. Note a l s o t h a t one estimate o f the c u r r e n t volume o f Japanese cargo moving to E a s t e r n Canada v i a the Panama Canal i s a l s o 66 2 5 0 , 0 0 0 tons a n n u a l l y . I t i s e s t i m a t e d t h a t a p p r o x i m a t e l y 7 0 $ of the cargo imported from 'OCP o r i g i n * n a t i o n s moves to OCP d e s t i n a t i o n s , 6 7 p r i m a r i l y Toronto and Mon t r e a l . Yasuyuki Mizuno, Chairman of the Japan C o n t a i n e r A s s o c i a t i o n noted t h a t 440,000 tons o f c o n t a i n e r i z a b l e cargo moved from Japan to Canada i n 1 9 6 9 * of 6 8 which 2 5 3 , 0 0 0 tons was d e s t i n e d f o r i n l a n d p o i n t s . One f r e i g h t s a l e s manager e s t i m a t e d t h a t the 1 9 7 0 volume o f Japan-6 9 Vancouver-Toronto cargo was ap p r o x i m a t e l y 8 , 0 0 0 boxcars. ( I f a boxcar h o l d s the e q u i v a l e n t o f 3 ? c o n t a i n e r s o f cargo, from the O r i e n t , which weigh an average o f 6 i tons each, (see T a b l e 3 . 2 1 ) the tonnage i n v o l v e d would be between 1 7 5 , 0 0 0 and 2 0 0 , 0 0 0 tons.) E a c h r a i l w a y moves a p p r o x i m a t e l y t h r e e - e i g h t h s o f t h e OCP 70 v o l u m e , w i t h t h e t r u c k f i r m s h a n d l i n g 20$ o f t h e t r a f f i c , w h i l e t h e A m e r i c a n r a i l r o a d s h a n d l e t h e r e m a i n d e r . A p p r o x i m a t e l y t h r e e - q u a r t e r s o f t h e p o o l c a r s a r e l o a d e d by V a n c o u v e r f r e i g h t 71 f o r w a r d e r f i r m s . B e c a u s e o f t h e u n u s e d s p a c e c a p a c i t y o f a t r u c k m o v i n g most 20 - f o o t v a n c o n t a i n e r s ( w i t h t h e r e s u l t i n g h i g h r a t e s t h a t must be c h a r g e d ) , c o n s i g n e e s a r e r e l u c t a n t t o engage i n t h e l o n g d i s t a n c e movement o f i n t a c t c o n t a i n e r s by r o a d . N e i t h e r a r e c o n t a i n e r s moved p i g g y b a c k b y r a i l , b e c a u s e CFA-38 -L i s a p i g g y b a c k t r u c k t a r i f f , n o t a p i g g y b a c k c o n t a i n e r t a r i f f . (CFA-263 does p e r m i t p i g g y b a c k c o n t a i n e r movement, b u t t h e c h a s s i s must be owned b y t h e o c e a n c a r r i e r . ) D u r i n g 1969 o n l y 53 c a r l o a d s o f c o n t a i n e r s w e i g h i n g 643 t o n s ( a n d a v e r a g i n g 13 t o n s p e r c a r l o a d ) , moved i n t h e W e s t e r n R e g i o n ( s e e T a b l e 3*8). W h i l e t h e W e s t e r n v o l u m e t r i p l e d i n 1970 t o I63 c a r l o a d s ; t h i s s t i l l o n l y amounted t o 2,156 t o n s . Compared w i t h t h e v o l u m e i n t h e E a s t e r n R e g i o n , t h i s t r a f f i c v o l u m e i s v i r t u a l l y n o n - e x i s t a n t . I n 1969, 2,548 c a r l o a d s o f c o n t a i n e r s , a v e r a g i n g 28 t o n s p e r c a r l o a d were moved. T h i s v o l u m e i n c r e a s e d by a f a c t o r o f 4 i n 1970 w i t h t h e w e i g h t p e r c a r l o a d r i s i n g t o 36 t o n s . T h i s i n d i c a t e s s u p e r i o r e q u i p m e n t u t i l i z a t i o n i n E a s t e r n C a n a d a , e v e n i f i t i s assumed t h a t a l l W e s t e r n movements c o n s i s t e d o f c o n t a i n e r s on 46 - f o o t r a i l c a r s a n d a l l E a s t e r n movement was on 85 - f o o t TABLE 3.8 CONTAINER ON FLAT CAR MOVEMENT EASTERN AND WESTERN RAIL REGIONS 1969 - 1970 1969 1970 Eastern Western Eastern Western Cars Tons Cars Tons Cars Tons Cars Tons J anuary 77 1236 1 16 482 13893 11 104 February 107 1943 708 16939 14 129 March 116 2039 857 26918 12 51 April 100 2309 840 24874 33 448 May- 215 4133 2 72 990 32843 11. 87 June 216 5223 2 30 911 33157 6 72 July 169 3443 1 15 855 33967 12 55 August 241 5298 13 187 752 27196 13 58 September 293 10511 9 79 772 38357 12 174 October 333 11367 10 91 963 43201 20 438 November 333 10497 9 79 968 39291 9 204 December 348 11305 6 74 948 38585 10 336 TOTAL 254"8 69302 53 54"3 10WZ 367221 163 2156" Source 1 Monthly Railway Carloadings. DBS. # 52-001. Queens Printer. Ottawa. 1969? 1970. cars. Neither assumption is entirely valid, although the tendency was for these types of container movements. Table 3 .9 indicates the much greater significance of poolcar traffic in both regions. A modest 3.8$ increase in Eastern Region poolcar traffic (from 58,000 cars in I969 to 60,000 cars in 1970) is shown, accompanied by a 16.5$ increase in tonnage moved as the weight of cargo per carload increased from 14 to 16 tons. During the same two year period Western poolcar movements declined by 18$ (from 23,100 to 18,800 cars), with no significant change in the weight per carload. The conclusions derived from the above data and Tables is that OCP cargo accounts for less than one-third of current Western r a i l traffic, and that the diversion of major quantities of this total OCP volume to trucks, or to Seattle, or to Eastern ports could easily result. A l l necessary components presently exist i f such diversion were deemed desirable. CONTAINERIZABLE CARGO VOLUME 72 Several studies, (see below), have been undertaken in the past three or four years in an attempt to estimate the probable volume of container units that wil l be passing through the Port of Vancouver. In almost every case the imput commodity data was two or more years old. This is most unfortunate because the decisions of 'when and how far' to containerize are being made on outdated information. In an EASTERN AND WESTERN RAIL REGIONS 1969 1969' -1970 1970 Eastern Cars Tons Western Cars Tons Eastern Cars Tons Western Cars Tons January February 4561 5323 66300 76900 1463 1703 18400 20300 ^385 5218 69000 86000 1732 1184 21500 12400 March April 4785 4080 66100 55500 2138 1654 28300 20400 5204 5222 85500 88900 1508 1460 16900 16400 May... June 5165 4824 75000 67700 1782 1811 22300 22400 4728 4954 79700 82100 1231 1736 13900 21500 July August 4740 4863 698OO 89000 2185 2157 27500 26500 4823 4944 82800 81900 1608 1459 20600 19700 September October 5257 5697 72200 79^ 00 2110 1893 26000 24500 5411 5797 85200 92600 1873 1777 27400 25600 November December 4656 4056 65400 58100 2120 1957 26600 23700 5172 4329 81200 66300 1596 1594 21500 21300 TOTAL 58007 841300 23073 286800 60187 981200 18758 238700 Source* Monthly Railway Carloadings. DBS. # 52-001. Queens Printer. Ottawa. 1969, 1970. r o Land Bridge Many of the proponents of a large container terminal fac i l i ty in the Port of Vancouver have pointed to the large volume of traffic that is moving by the Panama Canal to Eastern Canada and Europe. The visionaries can see an extensive land bridge uti l iz ing the trans-continental r a i l system for both a pure-land bridge and a modified or partial-bridge cargo movement. Both types of cargo movement do 73 qualify for the OCP rates. Currently, a North American land bridge for Japan-Europe traffic does not appear economically viable. The modified land bridge concept of moving cargo to the Great Lakes Region does appear feasible, but this is almost identaical with OCP traffic. For comparative purposes, Table 3*10 indicates the potential market for container traffic using both a pure port-to-port land bridge between Japan and Europe, and an import/ export land bridge providing a vessel-to-Great Lakes movement. Because the system apparently lacks sufficient incentives, and containerized vessels are planned for the Japan-Eastern North America ports in 1972, this study ignores this 'possible' traffic. TABLE 3 o IP- POTENTIAL CANADIAN CONTAINER TRAFFIC USING THE TWO LAND BRIDGE CONCEPTS Container-izable Traffic (tons) 500,000 150,000 PURE LAND BRIDGE Japan / Western Europes Eastbound Westbound IMPORT/EXPORT Japan-Far East / Eastern Canada: Japan-Far East / Western Canada: Japan / Chicago Customs Dis t r ic t 1 : (by vessel 1967) U.K.-Western Europe / Eastern Canada: U.K.-Western Europe / Western Canada: U.K.-Western Europe / Chicago Customs District ( I 9 6 7 ) 1 Eastbound Westbound Eastbound Westbound Eastbound Westbound Eastbound Westbound Eastbound Westbound 233,000 270,000 240,000 367,000 750,000 800,000 527,000 495,000 200,000 93,000 Equivalent Container Loads 75,000 15,000 20 -28 -40,000 27,000 32,000 37,000 Eastbound 29500,000 Westbound 1,450,000 75 -100,000 52,000 49,500 22,000 9.300 250,000 145,000 ^he Chicago Customs area includes: Pembina, N. Dakota? Duluth, Minn.; Cleveland, Ohio; Milwaukee, Wise; Detroit, Mich.; Minneapolis, Minn.; Chicago, 111.; and St. Louis, Mo. Sources Canadain National Railways. Cited by John R. Immer, Container Services of the Atlantic. 1970. 2nd Edition. Work Saving International. Washington, D.C. 1970. p. 74. The Canada Department of Trade and Commerce prepared estimates of the volume of economically containerizable cargo, by Canadian Port Region for 1965 "trade. This Study indicated that 16.0$ or 1,866,000 tons of Pacific Coast port export cargo and 24.4$ or 600,000 tons of import cargo was contain-erizable. The CTC Study. concluded that for 1967 approximately 1,741,000 tons of Canadian West Coast exports and 436,000 tons of Imports through B.C. ports could have been containerized? both values being somewhat more conservative than the Department of Trade and Commerce•Study. Since the only container fac i l i ty in the foreseeable future wi l l continue to be located in the Port of Vancouver, an analysis of the trade moving through this harbor has been 76 undertaken. Sheriff's Report, indicated that total containerizable imports in 1965 would have been about 200,000 tons with an additional 113,000 tons of containerizable 77 exports. The Johnston Terminal Report, estimated 1965 import 'suitable* containerizable traffic at approximately 372,000 tons with exports at 108,000 tons. Rees, in a study of potential container traffic through the Port of Vancouver for 1967» concluded that 785,000 tons of 78 exports were containerizable. He assumed that 480,000 tons 79 of *prime* cargo would occupy 38,300 20-foot containers (an average of 12.3 ton) although he states that the "average weight of inbound containers on a l l routes was 10.4 tons... (with an) average weight i n outbound containers (of) 13*5 tons (Either h i s l o g i c or h i s calculations appears to be f a u l t y here* because the commodities he has c l a s s i f i e d as 'suitable', 'marginal', and 'reefer' cargoes a l l have a greater density than the 'prime' commodities.) The I 9 6 7 Kates, Peat, Marwick and Go; Study forecast containerizable tonnages of the following amounts* 1968 - 290,000 tons 1972 - 360,000 tons 1975 - 420,000 tons (see Figure 3.1) The great majority (70$-80$) was expected to a r r i v e from the Orient with only 5-7$ from Australia-New Zealand. F3.gu.re. 3,1 PROJECTED CARGO TONNAGES 300,000 (TO BE SHIPPED IN CONTAINERS [THROUGH THE PORT OF VANCOUVER - 1968-197$ TONNAGE MOVED 200,000 100,000 19 Source: "Study of The Port of Vancouver" Keats, Peat, Marwick & Co. 1967. PORT OF VANCOUVER YEAR 1968 1969 1970 1971 1972 1973 1974 1975 Japan/Hong Kong 1700 3633 8866 15083 23433 28833 32833 35900 1968 - 1975 Eur op e/Br i t a i n 600 1700 3500 6100 9320 11360 12580 13600 Australia/New Zealand 20 60 500 1080 1740 2520 3240 3840 TOTAL 2320 5393 12866 22263 34493 42713 48708 53340 Sources , "Study of P o r t o f Vancouver", Kates, Peat, Marwick & Co. 1967. actually handled in Vancouver would rise from 2,000 in 1968 to about 50,000 by 1975. (see Table 3.11) They recognized that a significant tonnage of cargo currently moves from the Orient, especially Japan, through the Panama Canal to Eastern Canadian ports. The Report suggested that: " i f some agreement can be reached with the transcontinental railways, i t is possible that a substantial portion of this tonnage may be handled through Vancouver...This increase cannot be predicted with any certainty". 80 Containerizable Cargo Tonnages from 'OCP Origin' Nations This author concludes that i t is at least as l ikely that traffic currently moving via Vancouver and the inland carriers may be diverted through the Panama Canal. The existance of the current OCP (ocean) rate structure and the associated terminal charges absorption practices is based on the desire of the steamship and railroad companies to divert Panama Canal to cross-Canada land traffic. It is therefore somewhat surprising to find the current large volumes of both import and export traffic moving via the Panama Canal. The latest available import data by Port Region by commodity for each exporting country is presented in a group of Tables labeled Imports by Country By Commodity By Canadian Region By Year (see Appendix IX,X) which have been summarized in Table 3.12. The ocean mileages from representative OCP origin cities to the various Canadian ports are presented in Table 3.13* IMPORTS BY CANADIAN PORT REGION FOR SELECTED " CONTAINERIZABLE" COMMODITIES FROM " OCF > ORIGIN" COUNTRIES 1967 - 1968 Atlantic 1967 & Great Lakes 1968 Pacific 1967 Region 1968 Australia Ceylon 103,500 21,390 107,660 17,570 41,680 420 42,750 890 Japan Indonesia 122,4-30 930 143,440 450 357,400 365,970 500 Hong Kong India 26,550 71,230 17,540 52,630 24,520 8,590 24,320 8,760 China F i j i 130 mm mm 740 10,590 180 4,420 4.510 Korea Malaysia 1,700 38,270 500 49,580 2,080 7,890 4,250 3,410 New Zealand Oceania 13,000 20,880 2,530 5,660 6,500 7,100 5,850 Pakistan Philippines 15,860 5,980 21,470 2,400 660 3,110 1,330 10,770 Singapore Taiwan 33,850 23,480 36,090 37,370 5,380 29,730 6,480 49,770 Thailand 2,390 1,860 1,520 1,790 TOTAL 480,700 512,710 505,910 542,870 Source: Appendix IX, X. "Imports by Country by Commodity By Canadian Region by Year". Shipping Report. Part I. International Seaborne Shipping. DBS. # 54-202. Queens Printer, Ottawa. 1967, 1968. SEA DISTANCES BETWEEN MAJOR PORTS (Nautical Miles) The Orient - Canada - Australia Yokohama Hong Kong Sydney Vancouver 4,262 5,648 6,843 Halifax 10,020 11,533 10,012 St. John 10,043 11,557 10,035 Quebec 10,747 12,260 10,739 Montreal 10,886 12,399 10,878 Source: Distances Between Ports 19&5. H.O. Pub. No. 151. U.S. Naval Oceanographic Office, Government Printing Office, Washington. 1965. Cited by , "A Research Base for Develop-ment of a National Containerization Policy". Phase I of a report to the Canadian Transport Commission. Matson Research Corporation. San Pranscisco. July 1970. Appendix p. B-3. An analysis of these two Tables shows that approximately half as much Japanese cargo moves to the Atlantic Coast of Canada as to the Pacific ports, although the distance is two and one-half times further. The same trend is noted for goods from the Philippines, Hong Kong, and Taiwan, except that the volumes are more nearly evenly split between the two coasts and the distance is only slightly over twice as great to Montreal as to Vancouver. The Australian and New Zealand trade volumes are shifted markedly in favor of the Atlantic Coast ports, being two and one-half to three times larger than Pacific Coast shipments. Distances are more nearly balanced, being 7,000 miles from Sydney to Vancouver, and only 10,000 to Halifax or St. John. The very heavy ratio of Atlantic vs Pacific shipments from India, Ceylon, and Pakistan is not entirely unexpected. Certainly when the Suez Canal was functional Canada's East Coast was much closer than Vancouver. Also the commodity composition (tea, jute, molasses, and coffee) would favor an East Coast routing. Data on the imported tonnages of a l l cargo from selected OCP origin nations is presented in Tables 3.14 (for a l l Pacific Coast ports) and Table 3*15 (for the Port of Vancouver). In both Tables manufactured steel products have been included, although admittedly these goods are adequately handled by other means, perhaps more efficiently than in containers. With this qualification in mind, detailed commodity composition Tables have been prepared for the 4 'major* and 10 'minor' IMPORTED TONNAGES FROM SELECTED "OCP ORIGIN" COUNTRIES THROUGH CANADIAN PACIFIC COAST PORTS (Short Tons) COUNTRY 1961 1963 1965 1967 1968 Australia 50,345 30,825 40,125 63,485 152,525 Mainland China 1,400 2,085 19,440 12,725 4,415 Hong Kong 12,415 15,185 22,325 24,660 24,175 Japan 152,915 172,720 339,670 356,685 366,150 Korea 1 220 1.145 2,110 4,300 Singapore k 4,475 5,695 3,045 5,480 6,470 Malaysia 4,355 7.895 3,330 Taiwan 4.781 10,703 1 ,^280 29,770 49,5?0 TOTAL 224,340 237,435 m*m 50^,810 . .610,955 ALL" "COUNTRY TOTAL 2, 129,000 g,432,000 3,938,000 844,000 4,23$,000 Sourcei , "Oargoes Unloaded at Canadian Ports from Foreign Countries Shipping Report. Part 1, International Seaborne Shipping. DBS, queehs Printer. Ottawa, # 54-202. Shipping Report. Part 2, International Seaborne Shipping by Port, DBS, Queens Printer. Ottawa. # 54-203. TABLE 3.15  CARGO UNLOADED AT PORT OF VANCOUVER IMPORTS FROM SELECTED "OCP ORIGIN" COUNTRIES Thousands-(Short Tons) * #•55- *• COUNTRY 1961 1963 1965 1967 1968 1969 1970 Australia 41.2 27.1 28.6 40.8 55.3 51.8 28.9 Mainland 1.4 2.1 14.4 12.8 14.2 16.3 9.1 China Hong Kong 12.4 15.0 22.3 22.5 25.2 30.0 27.7 Japan 145.7 165.3 313.^ 39^.5 31^.3 379.0 437.O Korea — .2 1.1 2.1 5.3 6.6 5.2 Singapore 2.1 4.2 7.8 7.7 10.2 7.9 Malaysia 4.8 44.5 Taiwan 10.2 I S O 29.5 42.3 42.4 Total 207.6 224.1 39?.6 510.0 466.6 5?6.2 558.2 TOTAL ALL COUNTRIES 967.1 1,176.4 2,067.3 1. 995.0 1 .777.^ 2,278.3 1,849.0 Source 1 * , "Origin and Destination for Selected Ports". Shipping Report. Part IV. DBS. Queens Printer. Ottawa. #54-206. Table 23 . I96I-I965. * * , "Deep Sea Imports". National Harbour's Board. Vancouver. cf. Appendix IX. OCP 'origin nations' by commodity imported through the Port of Vancouver for the years 1 9 6 7 , 1 9 6 8 , 1 9 6 9 , and 1 9 7 0 . (These are presented in Appendix IX, and summarized in Table 1 6 . ) In 1 9 6 9 * 2 . 2 8 million tons of cargo was off-loaded at the Port of Vancouver (Table 3-15) • Of this total, approximately 2 2 $ (500,000 tons) of a l l general cargo was received from the four major OCP nations (Japan, Australia, Hong Kong, and Taiwan) with the great majority being from Japan. In 1 9 7 0 , the comparable data was 535*900 tons of general cargo from the same four countries, with Japan again supplying the most. As illustrated in Table 3»l6 Japan has consistently been the single largest supplier, and in 1 9 6 9 * accounted for almost 3 8 0 , 0 0 0 tons, including 180,000 tons of steel, pipe, and wirej while Australia in second place supplied just over 5°,000 tons including 2 6 , 0 0 0 tons of steel products, Taiwan with 42,000 tons and Hong Kong with 3 0 , 0 0 0 tons were the third and fourth largest suppliers. The comparable figures for 1 9 7 0 weret ( 1 ) Japan - 437,000 tons including 225,000 tons of steel products, (2) Australia - 29,000 tons including 6,200 tons of steel products, (3) Taiwan - 42,500 tons, and (4) Hong Kong - 27,500 tons. (see Table 3«l6) Table 3 . 1 7 outlines the total tonnages of commodities, excluding steel products and ores, which moved from OCP origin nations through the Port of Vancouver 1 9 6 7 - I 9 7 0 which could be classed as containerizable. These values appear to agree CANADIAN (CONTAINERIZABLE) IMPORTS FROM "OCP ORIGIN" NATIONS BY YEAR THROUGH THE PORT OF VANCOUVER (tons) 1 9 6 7 1 9 6 8 .1969 1 9 7 0 A u s t r a l i a 4 0 7 6 0 3 8 4 3 0 5 1 7 7 0 28880 Ceylon 4 1 5 1400 1 1 2 0 1 2 0 0 China Mainland 1 2 7 2 5 14240 1 6 3 2 5 9 1 4 5 F i j i and Oceania 1 6 4 5 2 0 6 0 2 6 0 2 3 0 Hong Kong 22485 2 5 2 3 0 3 0 0 4 5 2 7 6 5 5 I n d i a 8 4 6 5 8 6 6 0 7 0 8 5 6 7 3 5 Japan 3 9 4 4 7 0 3 1 3 8 4 5 3 7 8 8 0 5 4 3 6 9 5 5 Korea 2 0 6 5 5 3 0 0 6 6 2 0 5 2 1 0 New Zealand 5 1 0 5 7 7 9 5 9 6 7 5 1 2 0 0 5 P a k i s t a n 6 1 5 ; 7 7 5 I 8 3 0 5 1 9 0 P h i l i p p i n e s 3 1 1 5 4 6 8 0 2 8 9 5 4 4 4 5 Singapore and M a l a y s i a 7 8 4 0 7 2 2 0 1 0 2 2 5 7 9 4 5 Taiwan 2 9 5 0 5 4 4 5 3 5 4 2 3 0 0 4 2 4 1 5 T h a i l a n d 1 5 7 0 2 2 2 0 8 8 5 2 7 6 0 TOTAL 5 3 0 7 8 0 4 7 6 3 9 0 5 5 9 8 2 0 5 9 0 7 7 0 Source 1 Appendix IX. CONTAINERIZABLE TONNAGES OF CANADIAN IMPORTS  STEEL AND ORES EXCLUDED  FROM "OCP ORIGIN" NATIONS  BY YEAR THROUGH THE PORT OF VANCOUVER 1967 1968 1969 1970 A u s t r a l i a 26040 27000 25610 22620 China Mainland 12730 14240 16330 9150 Hong Kong 22230 25230 29020 27650 Japan 203390 175530 191000 213120 Korea 1700 5300 6100 3530 Singapore and Malays i a 1760 7220 10230 7950 Taiwan 29200 44540 42060 42180 TOTAL THESE COUNTRIES 294050 299060 320820 326210 Other Nations 19450 26540 23390 32510 TOTAL ALL "OCP ORIGIN" 313500 326600 344210 358720 COUNTRIES Source: Appendix ix the CTC Phase #1 Study. Kates, Peat, Marwick and Co. have forecast that as the volume of Pacific Rim trade increases in the next few years, the amount of cargo imported into Canada through British Columbia ports should increase to 800,000 tons 82 by 1975. Most of this should move through the Port of Vancouver and about half is expected to be containerizable. Their Study also forecast that 75$ of the containerizable 83 quantity (or 300,000 tons) would actually be in containers. The data presented in Table 3.17 indicates that the 300,000 tons in containers may be realist ic , but that the 800,000 tons moving through the Port of Vancouver may be unattainable. The fact that cargo tonnage through the Port of Vancouver is growing at a slower rate than Canada's foreign trade with these 'OCP origin nations' indicates that cargoes are being deverted away from the Port of Vancouver. Any loss of the Japanese trade* in particular, means that the Port of Vancouver is in serious trouble. Considering that total Japanese exports to Canada have increased from $274 million to $480 million from 1967 to 1969 (see Table 3.18), i t appears that the Port of Vancouver is being bypassed. The conclusions that are drawn from these data are« (1) the OCP rate structure is such that the low cost of ocean transport is not able to effect a change in modal routing: i . e . the OCP rates are not entirely operational: and (2) a very slight upward shift in the total freight cost from the O r i e n t through Vancouver to the OCP d e s t i n a t i o n a r e a c o u l d see the d i v e r s i o n of much of the OCP t r a f f i c currently-moving through the P o r t of Vancouver e i t h e r to S e a t t l e or to E a s t e r n Canadian or N o r t h - E a s t e r n U.S. p o r t s . Japanese Trade In view of the dominating p o s i t i o n of Japanese imports, on both Vancouver t r a f f i c and OCP cargo movements, i t seems a p p r o p r i a t e to b r i e f l y d i s c u s s the composition of t h i s t r a d e . Table 3.18 l i s t s Japanese exports to Canada by v a l u e . In the t h r e e y e a r s 1967» 1968, and 1969 the v a l u e i n c r e a s e d from $274.2 m i l l i o n to $481.0 m i l l i o n , a 76$ i n c r e a s e over the p e r i o d . Most of t h i s i n c r e a s e o c c u r r e d i n the products o f . t h e Heavy and Chemical I n d u s t r y c l a s s , which doubled from $146.8 to $304.9 m i l l i o n . W i t h i n t h i s c l a s s the l a r g e s t growth was i n : (1) Heavy Machinery - from $31.5 to $102.8 m i l l i o n , (2) Automobiles - from $6.4 to $61.8 m i l l i o n , and (3) Communications Equipment - from $22,6 to $45.8 m i l l i o n . While T e x t i l e s as a group d i d i n c r e a s e i n v a l u e from $58.1 to $82.4 m i l l i o n , two segments; Cotton F a b r i c s , and Spun Rayon F a b r i c s , showed marked d e c l i n e s i n both q u a n t i t y and v a l u e . Very moderate i n c r e a s e s o c c u r r e d i n the c l a s s 'Other L i g h t I n d u s t r y P r o d u c t s ' with S p o r t i n g Goods the o n l y commodity to m a i n t a i n c o n s i s t e n t growth. A l l these changes i n commodity importance i n d i c a t e t h a t TABLE 3 .18  JAPANESE EXPORTS TO CANADA 1967 — 1969 ( M i l l i o n s of D o l l a r s ) COMMODITY CLASS ( S e l e c t e d Items) 1967 1968 1969 FOODS TUFFS: F i s h 5.6 5.1 6.4 Mandrin Oranges (canned) .8 .9 1.3 TOTAL 11.6 11.6 12.6 RAW MATERIALS AND FUELS: TOTAL 2.1 1.7 2.1 LIGHT INDUSTRY PRODUCTS: T e x t i l e s - c o t t o n f a b r i c s 6.7 5.4 4.9 - woolen f a b r i c s 6.5 7.1 8.1 - spun rayon 3.3 2.8. 2.3 - c a r p e t i n g 1.4 2.0 2.6 - c l o t h i n g 20.1 23.8 26.4 T o t a l 58.1. 6?.? ' 82.4 Non-metalic M i n e r a l Products - p o t t e r y 4.0 4.0 5.1 - t i l e s 2.9 3.8 5.2 - g l a s s and g l a s s prods .6 1.9 2.3 T o t a l %± 10.6 13.6 Other L i g h t I n d u s t r y Products - plywood 5.2 9.2 8.8 - toys 5.3 6.1 6.2 - footwear 7.0 9.1 7.7 - s p o r t i n g goods 3.8 5.2 6.7 - m u s i c a l instruments 3.6 3.6 ^.3 T o t a l 46.0 57-3 65.2 TOTAL 113.5 161.3 HEAVY AND CHEMICAL INDUSTRIES: Chemical and P h a r m a c e u t i c a l . T o t a l 6.5 Z^8 9.0 Metals and Metal Products - i r o n and s t e e l ( b a r s , r o d s , p l a t e , s h e e t , p i p e ) 35«8 31.3 55.7 - metal p r o d u c t s (wire, 24.3 n a i l s , b o l t s , t o o l s ) 19.2 19.3 T o t a l 55.8 51.3 81.6 Machinery and Instruments - g e n e r a l machinery 18.5 22.4 35.^ - e l e c t r i c machinery 39.6 61.7 8?.9 ( i n c . TV,radios) - t r a n s p o r t (autos,bike)13.3 37.2 74.2 - cameras,microscopes 3«2 3.0 3.8 T o t a l 84.5 TOTAL 14~678 135.2 194.4 214. 3 304.9 TOTAL VALUE ALL EXPORTS 274.2 346.3 481. 0 Source: F o r e i g n Trade of Japan 1970. Japan E x t e r n a l Trade O r g a n i z a t i o n . Tokyo. October 1970. the "cheap* textile and toy industries. This trade is now being suplied more and more by the home based industry of Korea, Hong Kong, Okinawa, and Singapore. Japan has become renouned as an exporter of sophisticated electronic equipment, typewriters, cameras, and optical equipment, as well as chemicals, specialized groceries and the more expensive bamboo furnitures nearly a l l of which are 84 'high value* but low density commodities. However Japan is also exporting dense materials such as steel (in plate, bar, pipe or sheet form), ball bearings, 85 heavy industrial machinery, cement, and auto and engine parts. Tonnages have doubled, but the value has risen only about 6 0 $ . Most of the latter were thought to be only marginally suited to containerization, but the volume of these cargoes moving in containers is increasing. In 1968, approximately 2,300 containers (being handled as 8 6 deck-cargo) passed through the Port of Vancouver. This 87 number was doubled to 4,581 containers in 1969. These totals are totals of both imports and exports, and (presumably) are the number of container units, not of 20-foot container equivalents. The number of containers handled in the Port of Vancouver increased greatly in 1970. From January 1st until May 30th, 88 3,759 containers were handled, although the division between exports and imports is unknown. The commencement of the Japan 6 service in June provided a rapid increase in total container traffic. Table 3.19 provides the data on container imports and Table 3.20 presents the export data for the 14 vessel voyages of 1970, and the f i rs t dozen trips of 1971. Up to December 31, 1970 a total of 3,317 fu l l twenty foot and 238 fu l l fourty foot containers had been imported. During the same period 485 empty containers were imported. The total number of containers exported in this seven month period totaled 4,535 — 3,084 fu l l 20-foot units, 318 fu l l 40-foot units, and 1,133 empty containers. The actual number of containers moved for the whole of the Port of Vancouver for.1970 is unknown. A total of between 15,000 and 18,000 units can be derived, but the accuracy of this 89 figure cannot be verified at this time. However i t does appear safe to assume that the total number of containers moved CONTAINERS IMPORTED ON VESSELS  OF THE JAPAN 6 LINES 1970 - 1971 V e s s e l CY CFS TOTAL RAIL MOVE FULL EMPTY TOTAL T r i p FULL EAS WARD 20ft 40ft 20ft 40ft UNLOAD 1970 28 GA 1 64 167 231 6 203 21 — 252 GA 2 61 174 235 33 221 14 4 239 GA 3 45 188 233 1 198 35 — — 233 GA 4 38 156 194 10 177 17 20 8 222 GA 5 95 235 330 I V 320 10 59 — 389 HM 1 95 227 322 33 299 23 16 — 338 GA 6 65 200 265 7 246 19 29 32 326 BM 1 65 267 332 10 318 14 33 6 371 HM 2 31 83 114 10 110 4 5 — — 119 GA 7 44 199 243 11 225 18 23 — 266 BM 2 79 179 258 1 248 10 105 9 372 HM 3 45 163 208 12 199 9 28 — 236 BM 3 116 244 360 345 16 20 — 381 HM 4 60 169 222 — 208 21 51 12 296 1970 TOTAL 903 2651 3554 148 3317 238 418 67 4040 1971 340 34 GA 9 58 316 374 -- 3 — 377 BM 4 32 84 116 4 90 36 120 1 237 HM 5 40 212 252 18 246 6 50 6 308 GA 10 63 206 269 —• 256 13 14 — 283 BM 5 155 307 462 36 401 61 25 — 487 HM 6 64 237 301 25 291 10 17 7 325 GA 11 96 193 289 31 252 37 1 — 290 BM 6 159 232 391 24 345 46 4 — 395 HM 7 89 224 313 24 248 65 8 8 329 GA 12 95 180 275 25 231 44 — — 275 BM 7 n/a n/a 398 n/a 363 35 — — 398 HM 8 n/a n/a 241 n/a 210 31 1 3 245 TOTAL ( J a n - A p r i l ) ,?681 3273 418 243 25 3949 GA = Golden Arrow: HM = Hotaka Maru; BM = Beishu Maru. Source: F i l e s o f Empire S t e v e d o r i n g , C e n t e n n i a l P i e r , Vancouver. '.May, 1971. CONTAINERS EXPORTED ON VESSELS  OF THE JAPAN 6 LINES 1970-1971 V e s s e l CY CFS TOTAL RAIL MOVE FULL EMPTY TOTAL T r i p FULL WESTWARD 2 0 f t 40f t 2 0 f t 40ft" LOADED 1970 GA 1 26 273 299 2 276 23 24 — 323 GA 2 43 150 193 26 170 23 34 -- 227 GA 3 7^ 126 200 10 156 44 57 15 272 GA 4 47 97 144 _ — 127 17 63 4 211 GA 5 90 99 189 2 15^ 35 392 29 610 HM 1 67 '••99 166 - - 161 5 187 23 376 GA 6 59 82 141 mm 135 6 113 5 259 BM 1 65 187 252 4 246 6 86 18 356 HM 2 108 47 155 2 149 6 4 7 166 GA 7 124 77 201 mm mm 187 14 6 ** _ _ 207 BM 2 141 263 404 6 329 75 18 * * — 404' HM 3 196 138 33^ 6 313 21 ,58 — 392 BM 3 173 378 551 24 532 19 7 — — 558 HM 4 10 161 m -1 149 24 1 — 174 1970 TOTAL 1223 2179 3402 91 3084 318 1032 101 4535 1971 348 348 GA 9 137 211 20 275 73 — BM 4 101 104 205 15 203 2 76* - - 205 HM 5 204 92 296 22 272 24 - - - - 296 GA 10 63 89 152 24 150 2 70* 12* 152 BM 5 266 144 410 23 357 53 - - 423 HM 6 42 155 197 16 186 11 100* - - 197 GA 11 141 199 340 8 303 37 __ 370 BM 6 58 287 345 - - 298 47 49* -- 345 HM 7 130 190 320 — 299 21 48 — 368 GA 12 56 76 132 3 110 22 75(753 1 * 8 215 BM 7 n/a n/a 531 n/a 46l 70 5 561 HM 8 n/a n/a 241 n/a 24l 22 23* -- 263 1971 TOTAL (Jan-• A p r i l ) 3617 3155 384 191 13 3819 A l l Transhipped c o n t a i n e r s to P o r t l a n d , and S e a t t l e are omitted from above t o t a l s . GA = Golden Arrow; HM = Hotaka Maru; BM = Beishu Maru. Source: F i l e s of Empire S t e v e d o r i n g , C e n t e n n i a l P i e r , Vancouver, B.C. May, 1971. (imported p l u s exported) was w e l l i n excess of 15*000 u n i t s d u r i n g 1970. P r o s p e c t s are t h a t the number of c o n t a i n e r s to be moved i n 1971 c o u l d approach the 30,000 u n i t f i g u r e t h a t Kates, Peat, 90 Marwick had f o r e c a s t f o r 1972. I n any case, t h e i r f o r e c a s t of 50,000 u n i t s by 1975 appears much too c o n s e r v a t i v e , as t h i s 91 number may e a s i l y be moving by 1973* A t the p r e s e n t time v e r y few i n t a c t c o n t a i n e r s are a c t u a l l y moving e a s t o f Vancouver (see Table 3«19)» D u r i n g 1970 l e s s than 15$ of a l l imported c o n t a i n e r s moved by r a i l , and a s u b s t a n t i a l p r o p o r t i o n o f these went to A l b e r t a and 92 Saskatchewan, not to OCP d e s t i n a t i o n s . As shown i n Table 3.19, o n l y 5$ o f the Japan 6 imported c o n t a i n e r s moved o f f the dock by r a i l l a s t y e a r and o n l y s l i g h t l y more are doing so i h 1971. One o f the major reasons why the c o n t a i n e r s are not moving eastward i n t a c t i s the r e l a t i v e l y l i g h t weight i n each c o n t a i n e r . While Rees had assumed an average weight o f 10.4 tons (and h i s 93 d a t a i n d i c a t e d 12,3), the Keats, Peat, Marwick Study estimated 94 an average weight of 6 tons f o r each 20-foot c o n t a i n e r imported. T a b l e 3.21 shows t h a t the average f u l l Japan 6 L i n e c o n t a i n e r d i d c o n t a i n j u s t over 6 tons of cargo, and t h i s i n c l u d e d 86 c o n t a i n e r s o f cement weighing almost 20 tons each. No weight problem e x i s t e d on e x p o r t cargo as weights o f 15 to 18 tons per l o a d e d c o n t a i n e r were o b t a i n e d every time (see Table 3.22). INITIAL VOYAGES JAPAN 6 LINES TO VANCOUVER B.C. BY COMMODITY GROUP 1970 - 1971 GENERAL CARGO CEMENT REEFER CARGO ALL CARGO VESSEL # # # # # # # TRIP CONT TONS T/C CONT TONS T/C CONT TONS T/C CONT TONS T/C GA 1 199 1165 5.8 28 542 19.3 4 33 8.3 231 1740 7.5 GA 2 215 1320 6.2 20 399 20. 0 - — 235 1719 7.3 GA 3 219 1242 5.9 10 199 19.9 2 19 9.5 231 1460 6.3 GA 4 180 957 5.3 6 119 19.7 2 16 8. 0 188 1092 5.8 GA 5 314 1910 6.2 16 322 20.1 1 12 12.0 321 2234 6.8 HM 1 313 1890 6.0 3 60 20.0 3 20 6.7 3[conc) 58 19.3 322 2028 6.3 GA 6 265 1471 5.6 265 1471 5.6 BM 1 332 2086 6.3 332 2086 6.3 HM 2 114 739 6.5 114 739 6.5 GA 7 238 1564 6.5 238 1564 6.5 BM 2 256 1772 6.8 2 40 20.0 258 1812 6.6 2735 17945 o76" Sources F i l e s of Empire S t e v e d o r i n g , C e n t e n n i a l P i e r , Vancouver, B.C. February, 1971. CO TABLE 3.22  TONS OF EXPORTS PER CONTAINER  INITIAL VOYAGES JAPAN 6 LINES FROM VANCOUVER 1970 - 1971 VESSEL TRIP NUMBER OF FULL CONTAINERS 20 f t 40 f t TOTAL EXPORT TONNAGE AVERAGE TONS/ CONTAINER GA 1 276 23 GA 2 170 23 GA 3 156 44 GA 4 127 17 GA 5 154 35 HM 1 l6l 5 GA 6 135 6 BM 1 246 6 HM 2 149 6 GA 7 187 14 BM 2 329 75 HM 3 313 21 BM 7 461 70 HM 8 241 22 7312 1784 4975 3242 3315 2126 2871 2410 2017 4244 2604 3269 7296 5915 9096 3934 - 1 2 1 3442 4439 578T9 15.8 2 1 ^ 1 16.2 22.9 16.7 16.7 16.6 14.7 15.2 14.5 14. 3 16.8 16.8 16.2 18. 0 17.7 17.1 16.8 TFT? GA = Golden Arrow: HM s= Hotaka Maru; BM = Beishu Maru. Source: F i l e s of Empire Stevedoring, Centennial Pier, Vancouver, B.C. May 1971. T h i s Chapter has t r a c e d the development of Common P o i n t r a i l t a r i f f s i n both the United States and Canada, and OCP t a r i f f s i n Canada. A d e s c r i p t i o n of the c u r r e n t Canadian c o n t a i n e r t a r i f f s as these r e l a t e to t r a f f i c moving to Eastern Canadian d e s t i n a t i o n s has been presented. Cargo q u a l i f y i n g o f o r OCP ocean r a t e s must move from nations west of the 170 meridian West l o n g i t u d e , through P a c i f i c p o r t s , to E a s t e r n North American d e s t i n a t i o n s . I f t h i s i n l a n d movement i s v i a the Canadian r a i l r o a d s , the cargo w i l l a l s o q u a l i f y f o r a b s o r p t i o n of the t e r m i n a l charges a t the P o r t of Vancouver, and p a r t i a l a b s o r p t i o n of t e r m i n a l charges a t the P o r t of S e a t t l e . These a b s o r p t i o n p r a c t i c e s w i l l be discussed i n Chapter IV. The dominance of Vancouver as the l e a d i n g Canadian West Coast p o r t i s s u b s t a n t i a t e d and the commodity composition of cargo discharged a t t h i s p o r t from OCP ' o r i g i n ' nat ions has been s t u d i e d . T h i s study has not attempted to f o r e c a s t p o t e n t i a l c o n t a i n e r movements i n the P o r t of Vancouver, but data on the tonnage of c o n t a i n e r i z a b l e cargo f o r the years 1967-1970 i s presented. The c o n c l u s i o n reached was that the OCP rates have had o nly moderate success i n promoting on A s i a - V a n c o u v e r - E a s t e r n Canada movement as opposed to a movement v i a the Panama Canal . As t h i s trade becomes c o n t a i n e r i z e d , the e f f e c t i v e n e s s of the OCP ocean and p r e f e r e n t i a l r a i l r a t e s can be expected to container movement are implemented. Such changes may be uneconomic to part of the Canadian transportation industry. The Atlantic trade routes have experienced a rapid switch to containerized break-bulk cargoes, and these containers are moving intact to inland cities such as Montreal, Toronto, Detroit and Chicago. While the water portion of the Pacific trade is becoming containerized, very definite problems and disadvantages are currently associated with the inland movement of these goods from Vancouver. This result apparently arises because of the type of cargo involved. Basically there appears to be a problem with the density (or volume to weight ratio) of the Pacific Coast containerized traffic. While the Atlantic Coast trade does move cargo averaging about 9 tons per 20-foot container, v/ith some containers weighing up to 20 tons; traffic 95 to Pacific ports is about 30$ less dense. This matter of 'density' wi l l be explored in Chapter V. Unless the charges for containerized cargo movement and in particular, the inland container rates, become more competitive with the lower cost of moving containers by water, the future of inland intermodal van container movement from Vancouver to Eastern Canada for OCP cargo does not appear very promising. FOOTNOTES CHAPTER I I I 1. Canadian F r e i g h t A s s o c i a t i o n T a r i f f No. 254-B, Rule 20. 2. Japan-West Canada F r e i g h t Conference T a r i f f No. 2, Rule 3. 3. J . Shaw, P e r s o n a l Interview. 4. i b i d . 5. G. King, P e r s o n a l Interview. 6. This d i s c u s s i o n o f U.S. Common P o i n t Rates i s based on S. Daggett and J.P. C a r t e r , The S t r u c t u r e of T r a n s c o n t i n e n t a l  R a i l r o a d Rates, Bureau o f Business and Economic Research, Univer-s i t y o f C a l i f o r n i a P r e s s , Los Angeles, C a l i f . 1947. pp. 23-36. and I n t e r s t a t e Commerce Commission A c t i v i t i e s 1937 - 1962, Supplement to the Annual Report, U.S. Government P r i n t i n g O f f i c e , Washington, D.C. 1962. pp. 1-13? 130-136. 7. A new c l a s s i f i c a t i o n schedule became e f f e c t i v e i n May, 1952 e s t a b l i s h i n g a range from 100$ down to 27$ of F i r s t C l a s s r a t e s . M u l t i p l e s o f the f i r s t c l a s s r a t e were a l s o p e r m i t t e d . 8. By 1914 the r a i l r o a d s had c l a s s e d 193 c i t i e s as 'port t e r m i n a l s ' . See 29 ICC 65, 1914. Santa Rosa T r a f f i c A s s o c i a t i o n v. Southern P a c i f i c ; and U.S. v. Merchant T r a f f i c A s s o c i a t i o n , 37 Supreme Court Rep. 24, 19l6. C i t e d i n Daggett, op_. c i t . pp.35« 9. The commodities i n v o l v e d were i n 'Group B', those which were s u i t a b l e to both r a i l and water t r a n s p o r t a t i o n , and 'Group C , those which l e n t themselves"to a pre-eminent degree to t r a n s -p o r t a t i o n by water and thereby would move a t a low r a t e . " See ICC A c t i v i t i e s 1937-1962. op. c i t . pp. 6-9 10. The f o l l o w i n g r a t e s were approved: beans and b a r l e y @ 40#/cwt. ; wine @ 450/cwt. ; and d r i e d f r u i t s @ 600/cwt. i b i d . 11. i b i d . 12. See 173 ICC 377, 1931. C i t e d i n Daggett and C a r t e r , op_. c i t . , p. 31« 13. See 185 ICC 787, 1932; and 182 ICC 653, 1932. C i t e d i n Daggett and C a r t e r , op_. c i t . p. 31. 14. i b i d . 15. ICC A c t i v i t i e s 1937-1962, p_p_. c i t . pp. 6-9. Since the FAK r a t e i s a p p l i e d on the b a s i s of a minimum weight per boxcar, i t becomes a r a t e on'space a v a i l a b l e ' whenever the minimum weight i s not a t t a i n e d by the shipment. 16. " C e r t i f i c a t e Course", Canadian I n s t i t u t e of T r a f f i c  and T r a n s p o r t a t i o n , Toronto. pT I-3. I?. Daggett and C a r t e r , o p . . c i t . , pp. 3°-31' 18. i b i d . , p. 32. 19. i b i d . 20. See CFA-263; CFA-589-A. fef. CFA-47-D: GTvV-239-A; Soo Line 533? Soo Line 534. C i t e d i n "A Research Base For Development of a N a t i o n a l C o n t a i n e r i z -a t i o n P o l i c y " , Report to the Canadian Transport Commission P r e -pared by Matson Research C o r p o r a t i o n , Phase I, San F r a n s c i s c o . J u l y 1970. p. 99. 21. The Supplement to the Annual Report noted the c o n t r a -d i c t o r y stands taken by the ICC i n s u c e s s i v e cases by s t a t i n g : "The Commission has r u l e d under some circumstances t h a t the r a t e s s h o u l d be on a c l a s s i f i c a t i o n b a s i s t h a t r a t e s can be on a weight b a s i s r e g a r d l e s s o f . . . commodity..., t h a t charges on a per v e h i c l e b a s i s are proper, t h a t r a i l r o a d s can r e c e i v e a f l a t charge p e r t r a i l e r t r a n s p o r t e d as i t s share o f a j o i n t m o t o r - r a i l - m o t o r r a t e , t h a t s u b s t i t u t e s e r v i c e c o n s i s t i n g o f a combination of l i n e - h a u l movements i s a j o i n t s e r v i c e a n d . . . t a r i f f s should p r o v i d e f o r . . . s u b s t i t i o n . . . , t h a t t r a i l e r s h i p o p e r a t o r s and motor common c a r r i e r s should conduct t h e i r o p e r a t i o n s as j o i n t s e r v i c e s t h a t i t would be r e p u g n a n t . . . ( f o r a) common c a r r i e r . . . to l i m i t s e r v i c e to a p a r t i c u l a r c l a s s o f c a r r i e r s , and t h a t water s e r v i c e can be preformed w i t h commodities con-t a i n e d i n r a i l r o a d c a r s or motor v e h i c l e s . . . ( T h e ) Commission ( a l s o ) d e c i d e d t h a t a steamship company t r a n s p o r t i n g r a i l -r o ad c a r s was not a common c a r r i e r by r a i l r o a d . " C i t e d i n ICC A c t i v i t i e s 1937-1962, op_. c i t . , pp. 133-134. 22. i b i d . 23. Canadian I n s t i t u t e o f T r a f f i c and T r a n s p o r t a t i o n , op. c i t . , p. 5 »8. 24. R e g u l a t i o n o f these r a t e s was by the Board of Transport  Commissioners, or i t s p r e d e c e s s o r . 25. Canadian I n s t i t u t e o f T r a f f i c and T r a n s p o r t a t i o n , op. c i t . , p.~"k~t~k~. 26. i b i d . , p. 4.3. 27. i b i d . , p. 4 15. 28. F o l l o w i n g the p a t t e r n e s t a b l i s h e d i n the U.S., the new c l a s s i f i c a t i o n c l a s s e s "now range from C l a s s 100 (high) to C l a s s 27 (low), p l u s f i v e m u l t i p l e s of C l a s s 100." i b i d . , p. 4*5. 29. i b i d . . p. 4*6. 30. i b i d . , p. 4*9. 31. i b i d . , P. 17*1. 32. i b i d . , P. 5*15. 33. i b i d . , P. 17:11. 34. This i s the Steamship Conference of Lanes which move cargo from p o r t s i n Japan, Korea, and Okinawa to s p e c i f i e d B.C. p o r t s . On October 1, 1970 e l e v e n Steamship Lines were r e g u l a r members and another two were a s s o c i a t e members. This Conference had f o r m e r l y been known as the T r a n s - P a c i f i c F r e i g h t Conference o f Japan. 35* K. Cox, P e r s o n a l Interview. 36. S. Garrod, C. Crook, A. G. Thomsons J . Shaw, P e r s o n a l I n t e r v i e w s . c f . See a l s o the J u d i c i a l Report of the 'Vancouver P o o l c a r Case' r e c o r d e d i n the Canadian Exchequer Court Record as "Between* Her Majesty the Queen, and J.W. M i l l s & Son L i m i t e d , Kuehne & Nagel (Canada) L i m i t e d , Overland Import Agencies L i m i t e d , Denning F r e i g h t Forwarders L i m i t e d , Johnston Terminals L i m i t e d ? , Vancouver, B.C. Nov. 1967. 2 Ex. C. R. 1968. pp. 280-297. 37. 2 Ex. C. R. 1968. p. 284. 38. i b i d . , pp. 284-285. 39. For a more e x t e n s i v e d i s c u s s i d n of t h i s p o i n t see C a r l e e n O'Loughlin, The Economics of Sea Transport, Pergamon P r e s s , Toronto. 1967. p. 75. c f . Rule 34(b), Japan-West Canada F r e i g h t Conference T a r i f f No. 2 s t a t e s t h a t a 'revenue ton' may be "40 e f t , or 2000 l b s " , whichever produces the g r e a t e r revenue, except t h a t f o r c e r t a i n commodities o n l y "revenue tons of 2000 pounds" s h a l l be used. 40. 2 Ex C. R. 1968., op. c i t . , p. 284. 41. i b i d . Presumably the l a s t p o r t i o n of t h i s remark r e f e r s to t r u c k t r a n s p o r t i n t o OCP t e r r i t o r y . 42. C. Crook, A.G. Thomson,.. J . Shaw, P e r s o n a l I n t e r v i e w s . 43. CFA-254-B, Supplement No. 6, Rule 5-A(c), E f f e c t i v e October 29, 1970. 44. CFA-254-B, Rule 10-A(c). E f f e c t i v e February 1, 1971. 46. 2 Ex. C. R. 1968. . p_p_. c i t . , p. 291. 4?. i b i d . c f . J . Shaw, P e r s o n a l Interview. 48. Japan-West Canada F r e i g h t Conference T a r i f f No. 2, Rule 3 names the approved i n l a n d c a r r i e r s as "Railway c a r r i e r . . . , A i r Canada, Canadian P a c i f i c A i r l i n e s , L t d . , Motor C a r r i e r s , P a r t i e s to P a c i f i c Import T r a n s p o r t A s s o c i a t i o n Import F r e i g h t T a r i f f No. 2 s e r i e s . . . " p. 10. 49. J.. Shaw, P e r s o n a l Interview. 50. This statement i s c o n t a i n e d i n a l l o f the f o l l o w i n g T a r i f f s : CFA-254-B, Rule 50: CFA-263, Rule 20; CFA-589-A, Item 40. 51. For t h i s c o n s o l i d a t i o n s e r v i c e , the f r e i g h t forwarder w i l l l e v y a f e e of up to $.60/cwt., which i s i n a d d i t i o n to the item r a t e s e t out i n the CFA-254-B T a r i f f . 52. CFA-263, Rule 5. 53. CFA-263, Supplement No. 4, items 253 and 283. E f f e c t i v e February 28, 1971. 54. 2 Ex. C. R. 1968. , op_. c i t . , p. 282. 55. i b i d . , pp. 282-283. 56. CFA-70-A, e f f e c t i v e J u l y 1951i CFA-70-B, e f f e c t i v e June 1961j CFA-70-C, e f f e c t i v e May 1963. 57. 2 Ex C. R. 1968.. op. c i t . , p. 282. 58. op. c i t . , CTC Study, 1970. p. 98. 59* These are 'high v a l u e ' because they are v e r y s e a s o n a l i n n a t u r e . Items such as Christmas or V a l e n t i n e ' s Day c a r d s , or E a s t e r b a s k e t s , are ve r y v a l u a b l e the week or two bef o r e the 'day' but become r e l a t i v e l y v a l u e l e s s the day a f t e r . 60. These 'high v a l u e ' goods have a h i g h p r i c e a s s o c i a t e d w i t h them, and even a d o u b l i n g of the t r a n s p o r t a t i o n charge i s n o t l i k e l y to produce any n o t i c a b l e e f f e c t i n the f i n a l p r i c e . 61. G. Payne, "The Co n t a i n e r Way", Speech to the I n s t i t u t e  of Naval A r c h i t e c t s and Marine En g i n e e r s , Vancouver. A p r i l 23, 1971. P. 9. 62. I t must be noted here t h a t some 'bulk' commodities, e.g. d r i e d malt, p u l p , and a l f a l f a p e l l e t t s , have been c o n s i s t e n t export loads f o r c o n t a i n e r s moving from Vancouver on Japan 6 Line v e s s e l s d u r i n g 1970 - 1971. The Japanese Lines have a l s o c f . R e c e n t l y the f i r s t shipment of potash was moved from Oakland to Hawaii i n c o n t a i n e r s . "Potash i n C o n t a i n e r s " , F a i r p l a y , Jan. 1971. 63. R. Robinson, " S p a t i a l S t r u c t u r i n g of P o r t Linked Flows; The P o r t of Vancouver, Canada, 1965", Unpublished Ph. D. The s i s , U.B.C, Vancouver. Oct. 1968. pp. 35-38. 64. K. Cox, P e r s o n a l Interview. 65. C. Crook, A.G. Thomson,; G. Payne, D. Spink, G. Cameron, E. S t a t o n , P e r s o n a l I n t e r v i e w s . 66. " C o n t a i n e r Operations i n Vancouver", P u r c h a s i n g i n West- ern Canada, Feb. 23, 1971. pp. 8-9. 67. D. Spink, G. Cameron, C. Crook, A.G. Thomson,, P e r s o n a l I n t e r v i e w s . 68. " C o n t a i n e r i z a t i o n 70: F u l l Steam Ahead i n Japan, But Canadian Inland Movements Cause Worries", Canadian T r a n s p o r t a t i o n  and D i s t r i b u t i o n Management, Oct. 1970. ppi 16-17. 69. A.G. Thomson, E. St a t o n , P e r s o n a l Interviews. 70. B. Lindsay, P e r s o n a l Interview, 71. The major Vancouver F r e i g h t f o r w a r d i n g f i r m s are Lemar, J.W. M i l l s , Johnston Terminals L t d . , Fortex, and F r e i g h t Con-s o l i d a t o r s o f Canada. 72. The s t u d i e s reviewed c o n s i s t e d o f the f o l l o w i n g : " C o n t a i n e r i z a b l e Cargo Handled a t Canadian P o r t s i n I n t e r n a t i o n a l Trade During'the Year 1965", P r e l i m i n a r y E s timates, Department of Trade and Commerce, Ottawa. March 1968. C i t e d by Rees, p. 54. ( see below) "Study o f the P o r t o f Vancouver", A n a l y s i s by Kates, Peat, Marwick and Co., Vancouver. 1967. W.J. S h e r i f f , "The P o r t o f Vancouver General Cargo Requirements", Report f o r the N a t i o n a l Harbour's Board, B r i t i s h Columbia Research C o u n c i l , Vancouver. Jan. 1968. C i t e d by Rees, p. 57. (see below) "Cargo C o n t a i n e r i z a t i o n and the Po r t o f Vancouver", Report to the N a t i o n a l Harbour's Board by Johnston^ Terminals L i m i t e d , Vancouver. Feb. 1967. C i t e d by Rees, p. 58. (see below) G.R. Rees, " A n a l y s i s of P o t e n t i a l C o n t a i n e r T r a f f i c i n The P o r t of Vancouver", Unpublished M.B.A. Thesis , U.B.C, Vancouver. Sept. 1969. op_. c i t . , CTC Study, 1970. 74. Containerizable cargoes were defined as that cargo which was physically containerizable plus that cargo which had other characteristics which would make containerization profitable op. c i t . , Trade and Commerce Study, 1968. 75. op_. c i t . . CTC Study, 1970. p. 71. 76. Sheriff, op_. cit . , 1968. p. 33. 77* op_. c i t . , Johnston Terminals Report, 1967. pp. 10-14. 78. Rees, op_. c i t . , 1969. p. 80. 79* Rees defined •prime* container cargo as being "Commod-ities of high value with relatively high handling and shipping rates which can be readily packaged in containers, thus reducing their high degree of susceptibility to damage and pilferage. Major physical criteria are size and the relation of weight to cube. Examples are canned meat, apparel,liquor" ibid. 80. op_. c i t . , Keats, Peat, Marwick Study, 1967. p. III-3. 81. op_. c i t . , CTC Study, 1970. p. 71. 82. C. Clapham, "Containerization in the Seventies", Proceedings of the Canadian Transportation Research Forum, Panel Discussion, Vancouver. March 20, 1970. p. 3. 83. ibid. 84. 'Low density* is another way of saying high cubic. It means that a short ton of such cargo occupies several times the space that a 'low cubic* or dense commodity would require. 85. See Table 3.18. cf. C. Crook, A.G. Thomson, S. Garrod, D. McGregor, Personal Interviews. 86. op_. c i t . , Keats, Peat, Marwick Study, 1967, p. 1-1. 87. L. Carlyle, Personal Interview. 88. ibid. 89. 1970 Japan 6 Lines - Imports 3555 fu l l + 485 empty Exports 3402 fu l l + 1133 empty 6957 l S l g Total = 8375 Other Lines - Jan. 1 - May 31= 3759 - June 1 - Dec 31= 5240 (at same rate) Feasible Yearly total = 17t575 units. It is unknown whether the totals for the Other Lines are for both fu l l and empty containers of any length, but have assumed so. 90. G. Payne, op. c i t . , Speech to the I n s t i t u t e o f Naval  A r c h i t e c t s and Marine E n g i n e e r s , 1971. At t h a t time he claimed t h a t c o n t a i n e r movements through' the P o r t of Vancouver c o u l d be a t a r a t e of 35.000 u n i t s by the end of 1971. p. 11. 91. i b i d . 92. C. Crook, A.G. Thomson,- P e r s o n a l Interviews. 93« Rees, op_. c i t . , p. 80. 94. op_. c i t . , Keats, Peat, Marwick Study, 1967. c f . Clapham, op_. c i t . , 1970. p. 4. c f . The Johnston Terminals Study had used 20 tons as the f a c t o r f o r c o n v e r t i n g tonnages moved to number of c o n t a i n e r s . 95. Immer, op_. c i t . , 1970. p. 152. c f . Tables 3.21 and 3.22. OCP RATES AND TERMINAL CHARGE APPLICATION  FOR CARGO IN CONTAINERS This Chapter discusses the application of the OCP tariff and rates of terminal charge and the absorption practices, of the various carriers. Relevant rules of the Japan-West Canada tariff are analyzed and their implication for containers (both those destuffed on the Vancouver waterfront and those which move intact to OCP destinations) are explained. This involves an examination of the way the terminal charges are levied and collected as set out in the published wharf tariff used at the Vancouver Container Terminal for break-bulk, palletized and containerized cargo. Examples of the charges for cargo moving eastward by poolcars and in intact containers are presented in Table 4.1. This is followed by a description of the Port of Vancouver terminal charges that apply to cargo of various densities arriving by different methods. A summary is presented in Table 4.2. Calculations of the dollar amount of terminal absorptions applicable to containerized cargo, and the cost to the consignee for the movement from ship's tackle to his own warehouse by poolcar and by intact container are then derived. -The major problem encountered with OCP traffic, as alluded to in Chapter III, is one of cargo density. Since a large portion of this traffic has been composed of consumer items with a relatively high individual value but low weight factor, the inland carriers encounter equipment productivity problems when they attempt to move the intact container. The result has been unattractive rates for container movement. Some reference to the current ILWU Agreement is made in this Chapter but most of the discussion of the 'container clause' is left for Chapter V. OCP CHARGES The Japan-West Canada Freight Conference Tariff consists of two major sections. The f irst portion is a l ist ing of the rules which apply to OCP cargo and includes items such asi (1) the ports involved, (2) the participating carriers, (3) the general regulations for OCP cargo movement including the application of rates and definition of terms, (4) forms and procedure followed when applying for a rate adjustment, and (5) rules for containerized cargo. The relevant sections of the Tariff are included in the Appendix VI. The second part of the Tariff l i s t s , by commodity, the ocean rate to be charged each shipment of cargo, depending on whether the d e s t i n a t i o n i s a P a c i f i c L o c a l or an OCP p o i n t . With l i t e r a l l y thousands o f commodities i n v o l v e d , t h i s p o r t i o n o f the t a r i f f i s u n d e r s t a n d a bly voluminous. Some examples are p r e s e n t e d i n Appendix VII. SUMMARY OF CONTAINER PROVISIONS FOR OCP TRAFFIC Ocean F r e i g h t Charge D e t e r m i n a t i o n The g e n e r a l p r o v i s i o n s of the OCP t a r i f f have been d e s c r i b e d i n Chapter I I I . However c e r t a i n p r o v i s i o n s and r u l e s a p p l y o n l y to c o n t a i n e r i z e d cargo. The o r i g i n s and d e s t i n a t i o n s 1 are as e x p l a i n e d i n Chapter I I I , but the ocean f r e i g h t charges, whether L o c a l o r OCP, are e f f e c t i v e from the CFS or the CY o f 2 the l o a d i n g p o r t to the CY or CFS o f the d e s t i n a t i o n p o r t . The t e r m i n a l charges f o r l i f t i n g c o n t a i n e r s to and from c h a s s i s , t r u c k s or r a i l c a r s are absorbed by the oacean c a r r i e r s , e i t h e r a lone o r i n c o n j u n c t i o n w i t h the i n l a n d c a r r i e r s . T h i s a p p l i e s 3 a t both the l o a d i n g and d i s c h a r g i n g p o r t s . Reduced r a t e s are p r o v i d e d f o r u n i t i z a t i o n of cargo i f the c o n t a i n e r i s packed by the c a r r i e r , but no r e d u c t i o n i s granted f o r u n i t i z a t i o n i f the cargo i s shipped i n a shipper-packed c o n t a i n e r . The weight o r measurement of the p a l l e t i s excluded to a maximum o f 10$ of the t o t a l weight or measurement. When the c o n t a i n e r has been packed by the s h i p p e r f o r h i s e x c l u s i v e use, f r e i g h t charges w i l l be s u b j e c t to a minimum 5 u t i l i z a t i o n requirement. I f the c o n t a i n e r c a r r i e s a s i n g l e the inside cubic capacity of the container. If the single commodity is rated on a weight basis, the minimum wi l l be 95$ of the weight capacity, and " i f the total measurement and weight is less than the above stated minimums, freight shall be assessed on the lower deficiency at the rate applicable to 6 the highest rated commodity" in the shipment. The carriers are permitted to containerize break-bulk cargo for their own convenience, however this cargo qualifies for none of the conditions or concessions to containerized 7 cargo. It may show on the ship's manifest as containerized cargo but the Bi l l s of Lading are not to be so claused. "The approved inland carrier to which cargo has been released for transportation to an OCP (destination) must within 14 days...furnish to the ocean carrier . . .a copy of the 8 inland carrier's B i l l of Lading, Waybill, or Freight B i l l " , to show that the specific cargo was in fact forwarded. This B i l l of Lading must show the "name of the importing vessel, port of origin, ocean carrier's B i l l of Lading number, voyage number, final inland destination, and date of actual forwarding to such destination". 9 If this proof is not provided within 14 days of discharge from ship's tackle, freight charges on the basis of Local rates are collected. Similarly, i f the cargo leaves the ocean carrier's custody prior to forwarding, freight charges based on Local rates together with the applicable terminal charges are collected. With the change in the designation of approved inland the i n l a n d t a r i f f " , but now "ocean c a r r i e r s w i l l n ot make any a b s o r p t i o n o f t e r m i n a l charges on cargo which l e a v e s the 10 custody of the i n l a n d or ocean c a r r i e r s " . T h i s c o n d i t i o n a p p l i e s whether the cargo i s r e l e a s e d to the consignee or to a f r e i g h t f orwarder. However i f the cargo does subsequently ( w i t h i n 6 months from date of o f f - l o a d i n g from the i m p o r t i n g 11 v e s s e l ) , move to an OCP d e s t i n a t i o n , a c l a i m may be f i l e d w i th the ocean c a r r i e r f o r adjustment from the L o c a l to (the lower) OCP r a t e . T h i s c l a i m must be f i l e d w i t h i n 90 days of f o r w a r d i n g , o r i f the shipment i s forwarded on l o t s , w i t h i n 12 90 days o f f o r w a r d i n g the f i n a l p o r t i o n . R a i l F r e i g h t Rate D e t e r m i n a t i o n F o r Break-Bulk  and C o n t a i n e r i z e d Cargo The r e l e v a n t p o o l c a r and c o n t a i n e r r a i l t a r i f f s were d i s c u s s e d i n Chapter I I I . These import c o m p e t i t i v e f r e i g h t t a r i f f s appear almost i d e n t i c a l , i f o n l y the r a t e p e r hundred-weight i s c o n s i d e r e d . However the a p p l i c a t i o n o f each t a r i f f to the same shipment of goods p r o v i d e s markedly d i f f e r e n t charges to the consignee. For dense commodities the d i f f e r e n c e may n o t be s u f f i c i e n t l y s i g n i f i c a n t to discourage i n t a c t c o n t a i n e r movement, but f o r most consumer items w i t h a d e n s i t y of a p p r o x i m a t e l y 4 i l , the p r i c e of ' s e c u r i t y ' i n a s e a l e d c o n t a i n e r becomes expensive, a l t h o u g h not n e c e s s a r i l y p r o h i b i t i v e . The following examples illustrate the comparative line-haul charges incurred by a shipment of four container loads of goods from Vancouver to Toronto by both Container (CFA-263) and Poolcar (CFA-254-B) rates. The FAK class of CFA-263 (Item 316 Supplement 2) applies to the movement of two or more loaded containers on either a 46 or 85-foot flatcar from Vancouver to Toronto, and requires the return of the empty containers to Vancouver.* The minimum weight is 20,000 lbs. f o r containers on a 46-foot flatcar or 40,000 lbs. on a 85-foot car at a rate of $4.50/cwt. Any excess weight moves at a flat charge of $1.50/cwt. Return of the containers is at a nominal charge of $100.00 each. The Canadian railroads require that the consignee pay for the loaded movement east and that he also pay for the return of the empty container to the Vancouver waterfront. However the American railroads charge only for the loaded movement and agree to return the empty for nothing. At 'face value', this would indicate a lower price is being charged by the American railroads for the round trip container movement. However i t is not quite this simple. The American railroads are paying the container owner a 'per diem' allowance for each day that the container is in the hands of the railroad. As a result, the railroad members of the Transcontinental Freight Bureau are in financial trouble. Having established this procedure for pricing container movement, the American railroads are not in a strong enough position to revoke the practice. The CNR and CPR did not allow themselves to be 'trapped' by the steamship companies, and are strong enough to prevent such a situation in the future. Suppose the shipment c o n s i s t s of f o u r 20-foot c o n t a i n e r s weighing 8,000 l b s . each ( i . e . a cargo d e n s i t y o f 6:1) moving from Vancouver to Toronto and back-haul cargo i s not a v a i l a b l e . The FAK i n t a c t c o n t a i n e r r a t e o f $4.50 i s a p p l i e d to the minimum weight of 40,000 l b s . , p r o v i d i n g a t o t a l charge of $1800.00. T h e r e f o r e the t o t a l l i n e - h a u l charge w i l l be $2200.00, or an average charge of $6,88/cwt of cargo moved. The p o o l c a r t a r i f f (CFA-254-B) does not c o n t a i n a FAK commodity c l a s s , but Item 70 a p p l i e s to a m u l t i t u d e of goods. The r a t e i s $4.33/cwt, on a minimum weight of 30,000 pounds/ c a r l o a d . U s i n g the above example, almost the e n t i r e q u a n t i t y of goods c a r r i e d i n the f o u r c o n t a i n e r s c o u l d be p l a c e d i n one p o o l c a r (see r a i l c a r c a p a c i t y d i s c u s s i o n on pagel85) and thus the minimum weight p e r c a r would be a t t a i n e d . Cost o f the p o o l c a r movement would be $4,33/cwt t o t a l l i n g $1385.60, or $4.33/cwt of cargo a c t u a l l y moved. (The t r u c k i n g f i r m s c l a i m i t s h o u l d be f e a s i b l e to move t r u c k - l o a d q u a n t i t i e s o f cargo by road f o r app r o x i m a t e l y $4.00/cwt) Example 2 A l l d e t a i l s o f the shipment are i d e n t i c a l w i t h Example 1, except t h a t the c o n t a i n e r s now weigh 12,500 l b s . each, ( T h i s i s the average weight of c o n t a i n e r s moved by the Japan 6 L i n e s to Vancouver i n 197Q) The r a t e f o r shipment by p o o l c a r i s again $4.33/cwt, (minimum weight of 30,000 lbs. under CFA-254-B, Item 70) and $4.50/cwt by the container rate (CFA-263, Item 316). Here the minimum required weight of 40,000 lbs. is exceeded so the excess moves at a rate of $1.50/cwt. The total charge then is $1800 + 150 + 400 = $2350.00. The actual rate for cargo moved would be (1) poolcar - $4.33/cwt, (2) container - $4.70/cwt including return of the empties. Unquestionably, rates of these levels present a serious deterrent to the eastward intermodal movement of the voluminous import cargo arriving at the Vancouver waterfront in intact containers from the Orient, Table 4.1 presents a comparison of the charges incurred for different commodities under these two r a i l tariffs illustrating that in a l l cases the movement of the intact van containers is more expensive than via poolcar shipment. FOR COMMODITIES MOVED  BY POOLCAR AND IN INTACT CONTAINERS (Two c o n t a i n e r s per 4 6 - f o o t f l a t c a r ) May 1971 CFA-263 CFA-254-B  Example 1. Co n t a i n e r r a t e P o o l c a r r a t e CANNED FOODSTUFFS: Item 316 50 Minimum w e i g h t / c a r l o a d 20,000 l b s 40,000 l b s Rate/cwt. 5J54.50 f o r min.wt. $2.25/cwt. $1.50 f o r excess Shipment s i z e -(30,000 l b s / c o n t a i n e r ) 60,000 l b s 60,000 l b s Line h a u l charge - For B a s i c - $ 900.00 $ 1,350 For Excess- 600.00 Empty r e t u r n - 200.00 — TOTAL $1,700.00 $ 1,350 Example 2. BAMBOO FURNITURE:-Item 316 80 Minimum w e i g h t / c a r l o a d 20,000 l b s 40,000 l b s Rate/cwt. $4.50 f o r min.wt. $4.6l $1.50 f o r excess Shipment s i z e -(8,000 l b s / c o n t a i n e r ) 16,000 l b s l6,000 l b s Line h a u l charge - F o r ' b a s i c weight-$900.00 $737.60 For excess Empty r t n . 200.00 — $1100.00 $737.60 Example 3. RADIOS, TV's, STEREOS: Item 316 210 Minimum w e i g h t / c a r l o a d 20,000 l b s 40,000 l b s Rate/cwt $4.50 f o r min.wt. $4.23 $1.50 f o r excess Shipment s i z e -(12,000 l b s / c o n t a i n e r ) 24,000 l b s 24,000 l b s Line h a u l charge - For b a s i c weight $900.00 $1,015.20 For excess 60.00 Empty r e t u r n 200.00 — $1160.00 $ 1015.20 TERMINAL CHARGES DEFINED Terminal charges consist of the handling, wharfage, service and fac i l i ty , and truck or carloading charges assessed by the steamship lines, inland carriers, and dock operators. Recent attempts have been make to consolidate these charges into a single 'terminal levy* in a manner similar to that 13 employed in the Port of Seattle. "Handling is the service performed in moving cargo from 14 ship's tackle to the f i r s t place of rest on the terminal", be this railroad car, motor carrier, barge, lighter, other vehicle, or in the case of containers, to the f i rs t placement on the dock, whether or not this requires further dockside movement by straddle carrier. The handling charge applicable is that "named in the applicable terminal tariffs for break-bulk cargo", except that for cargo in containers delivered to the destination port's CY, "the handling charge wi l l be 15 reduced by 3 0 $ " . 'Ship's tackle' is defined to mean "that location immediately accessible to cargo gear used for l i f t ing cargo 16 and/or containers to or from the vessel". Wharfage is a per ton levy made by the dock authority, on a l l cargo, including containerized cargo, and the proceeds are used for maintenance and service of the dock faci l i t ies . The truck loading or carloading charge is the 'price* for a l l cargo including containers, delivered at the CFS or CY of the destination port. In addition a l l cargo "shall be assessed a service and 17 faci l i t ies charge of U.S. $0.65 per revenue ton". No similar charge is levied by the Port of Seattle. 18 TERMINAL CHARGE APPLICATION The Empire Stevedoring Company Limited and Terminal Dock Ltd. Wharf Tariff No, 4, sets out the charges to be levied on cargo moved across Centennial Pier in Vancouver. Basically these same charges are levied at a l l piers in Vancouver. A l l charges are based on the revenue ton, being 2,000 lbs. or 40 cubic feet, which ever yields the greater revenue. Only the class of cargo designated as ' A l l Goods, N.O.S.' (Not Otherwise Specified) wil l be discussed, but i t must be appreciated that many shipments are covered by commodity clauses which are different from the N.O.S. rate, usually but not always, being higher as they are based on weight tons. Table 4.2 summarizes these charges, (see page 173) Wharfage and Handling Wharfage charges are Can. $0.60 per revenue ton to a maximum of 4:1. This means that even i f the cargo is 10:1 ( i .e . i t requires 400 cubic feet of space to equal 2,000 lbs.) the maximum wharfage would o n l y be 4 x . 6 0 = $ 2.4o/revenue ton o f cargo. H a n d l i n g charges a r e a l s o based on the revenue ton f o r c a l c u l a t i o n purposes, with the l e v y b e i n g Can. $4.60 per ton (weight or measure (W/M)), f o r ' A l l Goods, N.O.S.'. A g a i n the maximum l e v y i s a 4J1 b a s i s so the maximum p o s s i b l e h a n d l i n g charge w i l l be 4.60 x 4 = $18.40 per ton W/M. Both o f the r a t e s f o r wharfage and h a n d l i n g are the charges a p p l i c a b l e to break-bulk cargo. I f the cargo i s 19 u n i t i z e d , the h a n d l i n g charges w i l l be reduced by 3 (J%» I f 20 the cargo i s c o n t a i n e r i z e d , ( i . e . has been d i s c h a r g e d from an ocean-going v e s s e l i n a c o n t a i n e r , moved to the CY, and subs e q u e n t l y r e l e a s e d from the CY to the i n l a n d c a r r i e r i n the i n t a c t c o n t a i n e r ) and has been moved by members of the Japan- 6 L i n e s , a r e d u c t i o n o f 30%, i n the h a n d l i n g charge i s , i n e f f e c t ) g r a nted. I f the cargo i s c o n t a i n e r i z e d , and i s moved by any o t h e r steamship l i n e but the Japan 6, a 40$ r e d u c t i o n i n 21 h a n d l i n g charges i s gr a n t e d . S i n c e no ' a l l - i n c l u s i v e ' f e e i s l e v i e d f o r these c o n t a i n e r movements, the 40$ r e d u c t i o n i s p l a i n l y e v i d e n t i n the consignee's b i l l . Empire S t e v e d o r i n g has a c o n t r a c t with the Japan 6 to move a l l o f t h e i r c o n t a i n e r s , and one of the p r o v i s i o n s o f t h i s c o n t r a c t i s t h a t Empire w i l l l e v y an ' a l l - i n c l u s i v e ' f e e f o r movement of the c o n t a i n e r s from the v e s s e l i n t o the CY, from the CY onto r a i l c a r o r t r u c k , and then o f f the dock. Thus while the 30% r e d u c t i o n i s granted i t does not appear as such on the consignee's b i l l . Service and Facility Charge Besides the wharfage.(600) and handling ($4.60) charges, a l l cargo moving across Centennial Pier is assessed a service and fac i l i ty charge of Can. $0.65 per ton W/M. This charge is made by Empire against the steamship company, and the steamship company passes i t on to the customer. (The fact that they are able to do so may be reason enough, but the justification for so doing is not clear.) Loading The dock operators also levy a loading charge against imported cargo. For ' A l l Goods, N.O.S.' the charge is $4.60 per ton W/M unless the truck or railcar can be loaded with handling by fork l i f t equipment only. In this case the charge wi l l be $1.70 per ton W/M. If the container has been destuffed in the CFS, the cargo is considered to be break-bulk and therefore the $4.60 per ton charge is levied. However i f the container is to be moved off the dock intact, the flatcar or truck flatbed loading charge is only Can. $0.75/ton W/M. These charges are the same whether i t is a Japan 6 vessel involved or some other company's container ship. Again, the loading, handling, wharfage and service and faci l i ty charges are a l l consolidated into the one all-inclusive fee by Empire to the Japan 6 and there is no necessary reason to assume that the individual parts of the total container-moving fee are d i v i d e d i n e x a c t l y t h i s manner. A l s o many goods are named i n the t a r i f f and the 'commodity r a t e s " a re d i f f e r e n t from the N.O.S. r a t e . The r a i l w a y s absorb a c a r l o a d i n g charge of $9.00/ton of 2,000 l b s , a g a i n s t the cargo. They f e e l t h a t t h i s i s a r e a l i s t i c f i g u r e f o r the low-density-high-volume t r a f f i c b e i n g 22 handled a t t h i s p o r t . T h i s same $9.00 (Canadian) charge i s used when d e t e r m i n i n g the a b s o r p t i o n to be a p p l i e d to imported cargo which a r r i v e s v i a S e a t t l e . Crane One o t h e r a p p l i c a b l e charge i s t h a t l e v i e d a g a i n s t the steamship l i n e s f o r the use of the g a n t r y crane. S i n c e i t matters l i t t l e whether the c o n t a i n e r has 4.000 l b s . o r 40,000 l b s . of cargo i n i t (the t r a n s f e r time i s almost the same), the dock o p e r a t o r s have ' p r i c e d ' the use df the crane a t $9.00 per c o n t a i n e r . I f f o r some reason, the consignee has a c o n t a i n e r a r r i v i n g as deck cargo on a c o n v e n t i o n a l v e s s e l , h i s charges may be g r e a t e r than i f i t was break-bulk. F o r example, he would pay a l l the t e r m i n a l charges n o r m a l l y a s s e s s e d a g a i n s t break-bulk cargo, p l u s a charge f o r l i f t i n g the c o n t a i n e r o f f the v e s s e l deck i f the use o f a mobile crane i s r e q u i r e d . T h i s i s not to say t h a t h i s s a v i n g s from l o s s , p i l f e r a g e or damage would not be s u f f i c i e n t t h a t the c o n t a i n e r movement would s t i l l prove p r o f i t a b l e . Table 4.2 summarizes the RELATIVE TERMINAL CHARGES PER REVENUE TON  PORT OF VANCOUVER  FOR CARGO ARRIVING BY DlFFERENT METHODS FOR FOR CARGOES ARRIVING IN CONTAINERS TERMINAL BREAK- ON ON ON OTHER CHARGE BULK CONVENT-• JAPAN 6 LINE CONTAINERIZED ITEM CARGO IONAL VESSELS VESSELS VESSEL CY . CFS CY CFS FOR CARGO OF 1:1 DENSITY Wharfage .60 .60 .60 .60 .60 .60 SerM & Fac .65 .65 .65, .65 .65 .65 H a n d l i n g 4.60 4.60 3.22* 4.60 2.76+ 4.60 Loading--manually 4.60 4.60 4.60 4.60 - f o r k l i f t 1.70 1.70 .75 1.70 .75 1.70 FOR CARGO OF 4:1 DENSITY Wharfage 2.40 2.40 2.40 2.40 2.40 2.40 Serv& Fac 2.60 2.60 2.60 2.60 2.60 2.60 H a n d l i n g 18.40 18.40 12.88* 18.40 11.04+ 18.40 Loading--manually 18.40 18.40 18.40 18.40 - f o r k l i f t 6.80 6.80 3.00 6.80 3.00 6.80 FOR CARGO OF 10:1 DENSITY Wharfage 2.40 2.40 2.40 2.40 2.40 2.40 Serv & Fac 6.50 6.50 6.50 6.50 6.50 6.50 H a n d l i n g 18.40 18.40 12.88* 18.40 11.04+ 18.40 Loading-46. 00 46.00 -manually 46.00 46. 00 - f o r k l i f t 17.00 17.00 7.50 17.00 7.50 17.00 Rate *Reduction o f 30$, and +Reduction of 40$ from breakbulk. Source: Empire S t e v e d o r i n g Company L i m i t e d and Terminal Dock L i m i t e d Wharf T a r i f f No. 4. E f f e c t i v e A p r i l 15, 1971. Vancouver, B.C. terminal charges levied against general cargo (N.O.S.) in the Port of Vancouver. TERMINAL CHARGE ABSORPTIONS As mentioned earlier (Chapter III) the railways and steamship companies have agreed to absorb the terminal charges of handling, wharfage, and carloading. The current OCP Agreement is that the steamships wil l absorb 60%> and the railways 40$ 23 when the cargo does move to OCP territory. These absorption shares refer to break-bulk cargo. On traffic which arrives in containers, is destuffed at the CFS, and then loaded into boxcars for Eastern Canadian destinations, the carriers make their regular absorptions. This is because the container is considered to be part of the ship, so this cargo is classed as 'break-bulk-. However an important difference must be noted for containers that are moving to OCP destinations intact. On these through-put containers the railways make absolutely no absorptions of any kind. The only reductions for which this cargo qualifies are the (lower) OCP rates and the reduced terminal handling charges, (either 30% or 40$ depending on the line involved). Since the r a i l container rates are essentially the same as those charged for commodities moving at carload (CL) rates on a "private 24 siding or team tracks within interswitching limits" basis, the significance of this non-absorption becomes evident. In addition, i f the containers f a i l to attain the minimum carload weight requirements, the c o s t of moving an i n t a c t c o n t a i n e r becomes p r o h i b i t i v e l y h i g h i n r e l a t i o n to the p o o l c a r r a t e s i n CFA-254-B. A t the p r e s e n t time a s t e a m s h i p - a i r l i n e combination i s of 25 l i t t l e importance i n Western Canada, and i t does not appear to h o l d much promise f o r the f u t u r e when c o n t a i n e r i z a t i o n i n i t s p r e s e n t form i s c o n s i d e r e d . The van c o n t a i n e r c u r r e n t l y b e i n g used i n ocean t r a n s p o r t i s b u i l t to w i t h s t a n d the s t r e s s e s 26 and s t r a i n s imposed by both l a n d and ocean voyages. As a r e s u l t i t has a h i g h t a r e weight i n p r o p o r t i o n to the weight o f most of the cargo b e i n g t r a n s p o r t e d to OCP d e s t i n a t i o n s . I f i n the f u t u r e s h i p p e r s and c a r r i e r s t u r n to the use o f a c o n t a i n e r which i s of l i g h t w e i g h t c o n s t r u c t i o n , and can be f i t t e d l i k e a s l e e v e i n s i d e the ocean van c o n t a i n e r , t h i s s i t u a t i o n may change. Examples o f the A b s o r p t i o n P r a c t i c e s o f T erminal Charges  as Followed by the Ocean and I n l a n d C a r r i e r s A number of examples o f the r e l a t i v e amounts of t e r m i n a l charges t h a t are absorbed by the i n l a n d and ocean c a r r i e r s are p r e s e n t e d i n Table 4.3. As these v a l u e s are per revenue ton, the s i g n i f i c a n c e of these a b s o r p t i o n s f o r cargoes of d i f f e r e n t d e n s i t i e s i s r e a d i l y apparent. S i n c e the motor c a r r i e r s do not r e c e i v e any p a r t i a l a b s o r p t i o n by the steamship l i n e s of the t e r m i n a l charges f o r OCP d e s t i n a t i o n cargo, t h i s d i s c u s s i o n d e a l s o n l y with the railway-steamship absorption practices. According to Rule #10 of the Rail Tariff, the " r a i l carriers wi l l absorb a portion of the wharfage, handling, and 27 carloading charges up to a maximum of $11.92 per 2,000 lbs," . The Japan-West Canada Freight Conference Tariff contains a clause which states that " in no event wil l ocean carriers 28 absorption exceed $21.08 (Canadian) per 2,000 lbs." . In both cases the cargo must be delivered directly from the ocean carrier to the on-going r a i l carrier for the absorption provisions to apply. In addition, paragraph 2 of Rule 10 of the Rail Tariff states that the r a i l "carriers wi l l absorb the cost of carloading only of $9.00 per 2,000 lbs." for cargo 29 discharged at Seattle, Washington. The examples in Table 4.3 illustrate that regardless of the 'airiness* or low density of the cargo, terminal charge absorptions are levied on a maximum of a 4»1 volume to weight. A l l of these charges apply to goods discharged in the Port of Vancouver in break-bulk form, and destined for OCP centers. If the cargo arrives at the dock in Vancouver in a container, and is destined for OCP territory, i t must be forwarded in one of two manners* (1) move in the intact container (in which case the railways and steamships wil l make no absorptions of the terminal charges) but the handling charge is reduced, or (2) be destuffed completely by the longshoremen on the Vancouver waterfront, in the Container Freight Station (CFS), and loaded into boxcars by the longshoremen on EXAMPLES OF TERMINAL CHARGE ABSORPTIONS  BY OCEAN AND RAIL CARRIERS FOR CARGO OF VARIOUS DENSITIES EXAMPLE 1. For cargo of 1:1 dimensions ( i . e . a weight of 2000 l b s . i n a space of 40 c u b i c f e e t ) the charges would be d i v i d e d as f o l l o w s : C a r l o a d i n g $ 9.00/weight ton = $ 9.00 Ha n d l i n g 4.60/revenue ton = 4.60 Wharfage .60/ " " .60 $14.20 R a i l r o a d share = 40$ of $14.20 = $ 5.68 Steamship share - = 60$ of 14.20 = 8.52 EXAMPLE 2. For cargo of 2:1 dimensions ( i . e . 2000 l b s = 80 cu. f t . ) the charges would be d i v i d e d as f o l l o w s : C a r l o a d i n g $ 9.00/ wt. ton = $ 9-00 Ha n d l i n g 4.60/ wt. ton X 2 = 9.20 Wharfage .60/ wt. ton X 2 = 1.20 $19.40 R a i l r o a d share = 40$ of $19*40 = $ 7.76 Steamship share = 60$ of 19.40 = 11.64 EXAMPLE 3. For cargo of 4:1 dimension ( i . e . 2000 l b s = 160 cu. f t . ) The charges would be d i v i d e d as f o l l o w s : C a r l o a d i n g $ 9.00/wt ton = $ 9.00 Handl i n g 4.60/wt ton X 4 = 18.40 Wharfage ,60/wt ton X 4 = 2.40 $29.80 R a i l r o a d share = 40$ of $29.80 = $ 11.92 Steamship share = 60$ of 29.80 = 1 7 . 8 8 EXAMPLE 4. For cargo of 15:1 dimension ( i . e . 2000 l b s = 600 cu. f t . ) the charges would be d i v i d e d as f o l l o w s : C a r l o a d i n g $ 9 . 0 0 / w t ton = $ 9.00 H a n d l i n g (max i s 4:1) 4.60/wt ton X 4 = 18.40 Wharfage (max i s 4:1) .60/wt ton X 4 = 2.40 R a i l r o a d share = 40$ of $29.80 = $ 11.92 Steamship share = 60$ of 29.80 = 17.88 $29.80 by the ocean and r a i l carriers. Cargo in any form moved by truck will not qualify for any terminal absorptions. This means that the terminal charges to the consignee on containerized OCP cargo may be higher than the charges for the same cargo which has been destuffed at the CFS. For examples assume a given cargo has dimensions of 6:1, has arrived at the Vancouver dock in a container, is destined for Toronto, and that the consignee has directed that the goods be transferred to a boxcar for forwarding. By agreement this must be done by ILWU labor on the docks. The resulting absorptions would bet Carloading $9.00 =9.00 Wharfage ' .60 x 4 = 2.40 (max. is 4.1) Handling 4.60 x 4 =18.40 (max. is 4:1) $29.80 The entire $29.80 wi l l then be absorbed by the carriers. If the cargo had gone forward in the intact container the terminal charges would have been: Carloading $9.00 Wharfage 2.40 (max. is 4»1) Handling 4.60 -40$= 2.76 x 4 = 11.04 $22.44 However the carriers make no absorptions on intact containers, so the consignee would be held responsible for these terminal charges. The result is that the cargo becomes more costly in a container than out. Using the same commodity and shipment size examples SOME EXAMPLES OF COMPARATIVE TOTAL LINE HAUL CHARGES  TO THE CONSIGNEE FOR OCP CARGO MOVED THROUGH  THE PORT OF VANCOUVER BY THE JAPAN 6 LINES~  SHOWING THE RELATIVE ABSORPTIONS IN  POOLCARS vs INTACT CONTAINERS May 1971 EXAMPLE l . CANNED FOODSTUFFS: 2 c o n t a i n e r s , 60,000 l b s . D e n s i t y o f 1.7.1 I n t a c t C o n t a i n e r : Wharfage: H a n d l i n g : Loading : Serv & Fac Line Haul: .60 x 1.7 =$ 1.02 NO 3.22 x 1.7 = 5.50 ABSORPTIONS .75 x 1.7 = 1.28 7.80 x 30=$234. 00 : .65 x 1.7 = 1.10 x 30= 33.00 (From Table 4.1 ) =1700.00 CFS - P o o l c a r Movement: .60 x Wharfage: H a n d l i n g : Loading : Serv & Fac: Line Haul: 1.7 = 1.02 4.60 x 1.7 = 7.82 1.70 x 1.7 = 2.90 $ 11.74  .65 x 1.7 x 30 = 33.OO (Table 4.1) =1350. 00 ALL CHARGES ABSORBED TOTAL COST TO CONSIGNEE IN TORONTO $1964.00 TOTAL COST TO CONSIGNEE $1383. 00 EXAMPLE 2. BAMBOO FURNITURE: 2 c o n t a i n e r s , 16,000 l b s . D e n s i t y of 6.2:1 I n t a c t C o n t a i n e r : Wharfage; .60 x 4 = 2 . 4 0 NO H a n d l i n g : 3.22 x 4 = 12.88 ABSORPTIONS Loading: .75 x 6.2 = 4.66 19T94 x 8 = 159.52 Serv & Fac: .65 x 6.2 = 4.03 x 8 = 32.24 Line Haul: (From Table 4.1) 1100.00 TOTAL COST TO CONSIGNEE IN TORONTO * C a r l o a d i n g : 9.00 x 30 = 270.00 Wharfage : 1.02 x 30 = 3O.6O H a n d l i n g : 7.82 x 30 = 234.00 Maximum Absorptions = $ 534.60 Terminal Charges = 352.20 Unabsorbed p o r t i o n = CFS - P o o l c a r Movement; Wharfage: H a n d l i n g : Loading : .60 x 4 ~= 2.40 4.60 x 4 =18.40 1.70 x 6.2 =10.50  31.30 6.2 = 4.03 NOT Serv & Fac: . 65 x Line Haul: (From Table 4.1) Unabsorbed Terminal Charges $1291. 76 TOTAL COST TO CONSIGNEE C a r l o a d i n g : 9.00 x 8 = 72.00 Wharfage : 2,40 x 8 = 19.20 Han d l i n g :18.40 x 8 =147.20 Maximum a b s o r p t i o n s = 238.40 Terminal Charges = 250.40 Unabsorbed p o r t i o n = 12.00 ALL CHARGES ABSORBED x 8=32.24 737.60 12. 00 $ 78.1.64 as p r e s e n t e d i n Table 4*1, c o s t s to the consignee have been c a l c u l a t e d i n Table 4:4. T h i s data demonstrates the e f f e c t s of the h i g h e r c o n t a i n e r r a t e s and the non-absorption of the t e r m i n a l charges. CONDITIONS UNDERSCORING DESTUFFING  ON THE VANCOUVER WATERFRONT LABOR UNION AGREEMENT The l a b o r agreement with the I n t e r n a t i o n a l Longshoremen's and Warehousemen's Union (ILWU), s i g n e d i n 1970, c o n t a i n s a '50-mile c l a u s e ' which governs the movement of c o n t a i n e r s i n the Lower B.C. Mainland. (see Appendix XI f o r exact wording) T h i s c l a u s e s t a t e s t h a t c o n t a i n e r s must be d e s t u f f e d i n the CFS a t the w a t e r f r o n t by longshore l a b o r , u n l e s s one of the f o l l o w i n g two c o n d i t i o n s has been s a t i s f i e d : (1) the c o n t a i n e r i s to be moved beyond Hope, B.C. b e f o r e b e i n g d e s t u f f e d , o r (2) the c o n t a i n e r i s b e i n g moved d i r e c t l y to the consignee's own premises, which he owns and m a i n t a i n s , (not r e n t s o r l e a s e s ) , and t h a t the consignee who i s the ' b e n e f i c i a l r e c e i v e r ' , owns the e n t i r e contents of the c o n t a i n e r and w i l l d e s t u f f the e n t i r e contents o f the c o n t a i n e r a t t h a t one l o c a t i o n . T h i s c l a u s e e f f e c t i v e l y p r events t h i r d p a r t i e s , such as f r e i g h t f o r w a r d e r s , a c t i n g on b e h a l f o f the consignee i n The ILWU enforces this agreement by having 'spotters* follow containers that are leaving the C% i f the Union suspects the containers are not being moved to the beneficial reveiver's own warehouse for complete destuffing. If the container movement does not, in fact, qualify for a l l the conditions stipulated in Item 2 (above), 'pickets* w i l l begin marching 3 0 around that container and thereby prevent i t being destuffed. To date, containers of imported cargo arriving via SeaLand or American Mail Lines at Seattle, and being moved to Vancouver by truck or the Burlington Northern Railroad to the premises of freight forwarders (such as Johnston Terminals, Mills, or Leimar) or to trucker's terminals (such as G i l l , CP Transport, or Midland Superior), have not been affected by the longshoremen. For these same reasons, Western Assembly bring their shipments 3 1 in through Seattle. EMPTY CONTAINER RATES FROM THE PRAIRIES The majority (Table 3 » 1 9 ) of a l l containers arriving at the Port of Vancouver are being destuffed on the dock by the longshoremen i n the CFS, and the contents are being moved by Teamster Union members to a freight forwarding station or other location for consolidation into truck load or poolcar 3 2 consignments for shipment eastward. Of the 1 0 $ - 1 5 $ of containers that are moving East intact, the great majority are heading for Alberta destinations, with some moving to Regina. This P r a i r i e t r a f f i c has developed almost d i r e c t l y as a r e s u l t of a lowering of the price charged by the railways f o r the return of an empty container to Vancouver: from $70 - $80 previously* down to a current $30 f o r Alberta, and $40 f o r 33 Regina. CARGO CHARACTERISTICS The marked tendency toward destuffing of the container i n Vancouver can be a t t r i b u t e d to three main cargo c h a r a c t e r i s t i c s : (1) the type and value of the goods moving i n import trade (discussed i n Chapter I I I ) , (2) the sortation procedure that i s u t i l i z e d i n loading the containers i n the Orient, (3) the density c h a r a c t e r i s t i c s of the cargo r e l a t i v e to modal equipment. The Problem of 'Mixed Shipments' Often the OCP 'origin-area' shippers pack consignments f o r Vancouver, Calgary, Winnipeg, or other OCP destination points into the same container. This may be because they (1) have i n s u f f i c i e n t volume f o r each point, (2) they do not appreciate the physical distance between the Canadian c i t i e s , (3) they have 'always done so', or (4) f o r some other^private reason. Some examples of t y p i c a l c o n t a i n e r l o a d s f o r CFS d e s t i n e d c o n t a i n e r s are i l l u s t r a t e d i n Table 4i5. Weights range.-, from 6,000 to over 32,000 l b s . , and a g r e a t d i v e r s i t y o f goods are stowed i n the same c o n t a i n e r . Even when the c o n t a i n e r has a weight over 30,000 l b s . and i s d e s t i n e d f o r OCP t e r r i t o r y , i t e i t h e r c o n t a i n s a d i v e r s i t y o f commodities or has a number of d e s t i n a t i o n s , o r both (see #3, #4, i n Table 4*5). T h i s p r a c t i c e makes i t mariditory t h a t the c o n t a i n e r be d e s t u f f e d i n Vancouver ( i . e . on the docks by ILWU l a b o r ) . T h i s ' s o r t a t i o n and s t u f f i n g ' procedure has thus e f f e c t i v e l y e l i m i n a t e d many of the b e n e f i t s t h a t c o u l d have accrued from c o n t a i n e r i z a t i o n o f t h i s t r a f f i c . Cargo D e n s i t y C o n s i d e r a t i o n s i n R e l a t i o n to Equipment C a p a c i t y The matter of cargo d e n s i t y becomes v e r y important when c o n s i d e r i n g whether cargo w i l l move eastward i n c o n t a i n e r s , r a i l r o a d boxcars, o r t r u c k s . In a d d i t i o n , the movement e a s t o f c o n t a i n e r s i s governed to some exte n t by the type o f cargo moving westward, and the source o f t h i s west-bound cargo. When a comparison i s made wit h the weight/volume c h a r a c t e r i s t i c s o f the r a i l boxcar and the highway t r u c k o r s e m i - t r a i l e r , the ina d e q u a c i e s o f the c o n t a i n e r , under the pr e s e n t r a t e schedule, become obvious. SAMPLE CONTAINER LOAD PLANS  FOR IMPORTED CFS CONTAINERS  VANCOUVER CONTAINER TERMINAL May 1971 Sample # 1. 100 c a r t o n s l a d i e s s a n d a l s 7 " p o r c l e a n wares 20 " d r i e d v e g e t a b l e c o l e 25 " g i r l s jeans 17 ' " c o t t o n o v e r a l l s Sample # 2. 42 cartons, mens c o t t o n T - s h i r t s 5 " c o t t o n s h i r t s 21 " w i l l o w baskets 21 " t a b l e mats Sample # 3. 403 c a r t o n s t o o l s 48 9 3 42 13 1 t o o l s buttons r a c h e l l e edgeing l a c e s p o r t i n g goods pe t s u p p l i e s t o o l s 4400 l b s . 540 l b s . 1764 l b s . 3527 l b s . 2425 l b s . 12665 l b s . 5700 l b s . 617 " 1087 " 1568 " 8972 i r~ 26174 l b s . 3462 648 253 1753 509 99 32H9I Sample # 4. 312 c a r t o n s i r o n p i p e f i t t i n g s 125 15 Marked wrought i r o n c a n d l e h o l d e r s Sample # 5* 25082 l b s . 3000 " 360 " 28442 ~ Vancouver; Winnipeg v i a Vancouver - OCP; Toronto v i a Vancouver - OCP; Montreal v i a Vancouver - OCP; and Vancouver. 170 c a r t o n s hardware <*5 6 60 pumps b r a i d s d r i e d mushrooms Sample # 6. 12 c a r t o n s g l a s s headed p i n s 59 " v i n a l baskets 17 " rayon chenel stemware 88 " stoneware I8850 l b s . 2985 " 311 " i860 " 24006 ~ 544 l b s . 1811 " 1020 " 3256 " 6631 "*~ Source: C o n t a i n e r Load Plans (CLPs) from c o n t a i n e r s imported through the P o r t of Vancouver v i a the Golden Arrow voyage // 13. May 1971. Container Capacity The average 20-foot container carried by vessels of the Japan 6 has a cargo load of about 6 tons (Table 3:21), yet i t has a load limit of 40,000 lbs. and a space capacity of 1050 to 1100 cubic feet. If the container contains dense (1:1) cargo, the maximum allowed weight would occupy only 800 cubic feet of space, but since the majority of the imports from the Orient approach a 4:1 dimension, the volume constraint is reached f irst with only 6 to 7 'weight-tons' of cargo. In addition, a broken stowage factor of 10$ to 25$ means that only 800 to 1000 cubic feet of space actually is useable in most containers. The 40-foot container has a proportionally higher utilizable volume (about 2200 cubic feet), but the load limit is only 1,5 times that of the 20-foot unit at 60,000 pounds. These factors, combined with the physical problems encountered with the big containers, have limited the number of 40-foot units arriving and departing from the Port of Vancouver to less 35 than 10$ of total movements. Rail Boxcar Capacity The regular r a i l boxcar (40'6" long inside) has a weight capacity of 100,000 to 140,000 lbs. and a volumetric capacity of 3900 cubic feet; equal to 3J or 4 twenty-foot containers on both measures, but requiring the same space in a train as two 20-foot containers on a 46-foot flatcar. The railway tariffs were established on the basis of two containers per 46-foot flatcar or four containers on an 85-foot container bogie with minimum weights of 10,000 lbs. per 20-foot unit. If a two-container shipment does not weigh the minimum amount, the consignee must be prepared to pay for the dead freight 37 difference i f the container is to move east intact. Road Equipment Capacity A highway truck tractor can pull two 26-foot trailers, having a capacity of 1850 cubic feet each, while the 35-foot trai ler has a volume limit of 3700 cubic feet. To move two 20-foot containers on truck flatdeck provides only 1900 cubic feet of space. Since almost a l l the cargo from two 20-foot containers can be stowed into one 26-foot truckbox, there is no incentive to move 20-foot containers. The motor carriers find that their cost to move a 40-foot container unit on a chassis (with 2200 cubic feet of space) is about the same as to move their own equipment with 3700 cubic 38 feet of revenue producing space. The cost is virtually the same, whether i t is moved piggyback or over-the-road. Actually the price of piggyback traffic is detrimental to the movement of containers as piggyback traffic because the r a i l rate is quoted on a minimum of 40,000 lbs. , but with only 9 - 1 2 tons in a 40-foot container, the consignee wil l have to pay for 10,000 to 20,000 pounds of dead freight. The weight of imported cargo u s u a l l y i s not a l i m i t i n g f a c t o r . When heavy cargo on one B i l l o f La d i n g i n one c o n t a i n e r does a r r i v e , i n p r a c t i c a l l y every i n s t a n c e i t moves e a s t by r a i l , because t a r i f f s f o r dense commodities as e s t a b l i s h e d by the r a i l r o a d a re more f a v o r a b l e than the 39 t r u c k e r s can s u p p l y f o r l o n g h a u l s . The i n e v i t a b l e r e s u l t i s t h a t the motor c a r r i e r s are f o r c e d to quote r a t e s f o r c o n t a i n e r t r a f f i c t h a t are much h i g h e r than f o r t h e i r own equipment. (These r a t e s a re a l s o h i g h e r than those b e i n g quoted by the r a i l w a y s f o r comparable s e r v i c e . ) The p r i c e d i f f e r e n t i a l appears to be a t l e a s t 75$ g r e a t e r to move cargo i n c o n t a i n e r s by road than to move the same goods i n t r u c k t r a i l e r s , when the d e t e r m i n a t i o n i s made on a per hundred weight b a s i s . The r e s u l t i s obvious? the t r u c k i n g i n d u s t r y i s not moving c o n t a i n e r s o f a through-put nature because the consignees w i l l not pay f o r the dead f r e i g h t . SUMMARY It appears that the railroads have not made any effort to establish container rates that wil l encourage intermodal movement from Vancouver.. They have used the argument that these rates wi l l be established as soon as the carriers are guaranteed volume movement of containers, but this volume must be on their own line ( i .e . CNR or CPR), not just on the railway system. Further, the railways protest that they have a very large investment in a large number of perfectly usable boxcars, which have not yet been 'depreciated out'. They question the rational of 'rushing out to buy the new container bogies' at a cost of $17,000 to $20,000 each, when they have no assurance that containerization wil l provide the intermodal answers everyone is seeking for Canadian Westcoast imports. CHAPTER IV 1. Japan-West Canada F r e i g h t Conference T a r i f f No. 2, Rule 3 . 2. i b i d . , Rule 101. 3 . i b i d . , Rule 108. 4. i b i d . , Rule 104. 5 . i b i d . , Rule 115. 6 . i b i d . 7. i b i d . , Ruie 116. This Rule i s s l a t e d to e x p i r e June 30 , 1971, u n l e s s extended. The Pacific-Westbound F r e i g h t Conference which a p p l i e s to t r a f f i c from West Coast P o r t s to Japan and the Far E a s t , has a s i m i l a r r u l e . See P a c i f i c Westbound Conference L o c a l T a r i f f No. 3 . Rule 70 B, Item 12. 8. i b i d . , (Japan-West Canada) Rule 3 . 9. i b i d . 10. i b i d . 11. i b i d . 12. i b i d . 1 3 ' A meeting between the S h i p p i n g Companies, Agents, R a i l -ways, and S t e v e d o r i n g Companies was h e l d i n Vancouver May 1 3 - 1 5 , 1971 i n an attempt to e s t a b l i s h a s i n g l e , a l l - i n c l u s i v e , 'dock' f e e , on a b a s i s s i m i l a r to the p r a c t i c e c u r r e n t l y f o l l o w e d i n the P o r t of S e a t t l e . 14. op_. c i t . , Japan-West Canada. Rule 23. 15. i b i d . 16. i b i d . , Rule 22 . 17. i b i d . , Rule 23 . 18. The f o l l o w i n g d i s c u s s i o n i s based on Empire S t e v e d o r i n g Company L i m i t e d and Terminal Dock L i m i t e d Wharf T a r i f f No. 4 , a p p l i c a b l e to Berths 4 , 5 , 6 , C e n t e n n i a l P i e r , Vancouver, and e f f e c t i v e i n r e v i s e d form A p r i l 1 5 , 1971. c f . G. Payne, P e r s o n a l Interview. 19. U n i t i z e d cargo i s d e f i n e d as b e i n g "a c o n s o l i d a t i o n of uniform s h i p p i n g packages secured to p a l l e t s " w i t h the i n d i v i d u a l packages h e l d s e c u r e l y t o g e t h e r f o r m i n g a s i n g l e s h i p p i n g u n i t to f a c i l i t a t e mechanical h a n d l i n g . See i b i d . , Item 2.1.(g). p. 7. 20. C o n t a i n e r i z e d goods are d e f i n e d as be i n g "goods r e c e i v e d i n a c o n t a i n e r v/hich i s f o r movement i n t a c t between v e s s e l and i n l a n d c a r r i e r " . See i b i d . , Item 2.1.(h). p. 8. 21. i b i d . , Item 2.29.(b). p. 13. 22. C. Crook, P e r s o n a l Interview. A.G. Thomson, P e r s o n a l I n t e r v i e w . 23. Formerly the charges were shared 50$ by the Steamship Line and 50$ by the Railway. See op_. c i t . , Japan-West Canada T a r i f f , and Canadian F r e i g h t A s s o c i a t i o n T a r i f f No. 254-B. 24. See CFA-254-B, Rule 80. 25. In the Vancouver P o o l c a r Case, the Judge noted t h a t the a i r l i n e s a re not r e a l competitors w i t h the r a i l w a y s and t r u c k e r s f o r the trans-shipment o f OCP cargo, and the s i t u a t i o n would n o t appear to be m a t e r i a l l y d i f f e r e n t a t t h i s time, p a r t i c u l a r l y f o r c o n t a i n e r i z e d goods. See 2 Ex. C. R. 1968. 26. Intermodal van c o n t a i n e r s must have much g r e a t e d s t r u c t u r a l s t r e n g t h than'road-only' c o n t a i n e r s , and c o n s i d e r a b l y more than ' a i r - o n l y ' u n i t s because o f the much more severe t w i s t i n g , b u c k l i n g and c r u s h i n g tendency t h a t r e s u l t s from wave a c t i o n . As w e l l , o n l y i n ocean c a r r i a g e would the c o n t a i n e r be s u b j e c t e d to long p e r i o d s of c o n t i n u a l t i l t i n g a t up to 15° i n op p o s i t e d i r e c t i o n s i n the space of a few minutes. 27. See CFA-254-B, Rule 10.A. This $11.92 i s composed of a $9.00 c a r l o a d i n g charge, p l u s the h a n d l i n g charge o f $4.6o/ton W/M, to a maximum of 4:1 (4.60 x 4 = $18.40), p l u s the wharfage o f $.6o/ton W/M to a maximum of 4:1 ( .60 x 4 = $2.40). Added t o g e t h e r these charges t o t a l ( 9.00 + 18.40 + 2.40) $29.80. F o u r t y p e r c e n t of $29.80 = $11.92. 28. op_. c i t . , Japan-West Canada, Rule 3« The value mentioned a p p l i e d i n the T a r i f f No. 1, and w h i l e the a c t u a l v a l u e i n the c u r r e n t T a r i f f has not been determined, i t i s s u f f i c e n t l y h i g h t h a t i t p r e s e n t s no d e t e r e n t to the movement of cargo. 29. CFA-254-B, Rule 10 A. 30. C. Crook, A.G. Thomson;. P e r s o n a l I n t e r v i e w s . 31. K. Cox, P e r s o n a l Interview. 32. C. Crook, A.G. Thomson,- P e r s o n a l Interview. 34. G. Cameron, P e r s o n a l Interview. 35« C. Crook, A.G. Thomson,., P e r s o n a l Interview. 36. CFA-263. 37. Up to the p r e s e n t time t h i s has not been the g e n e r a l r e a c t i o n of consignees, although a few ex c e p t i o n s have been noted. Nisan Automotive L t d. has been moving i n t a c t c o n t a i n e r s of auto p a r t s ( p a r t i c u l a r l y f e n d e r s and body p a n e l s ) to E a s t e r n Canada, even though the c o n t a i n e r s have weights of o n l y 6,000 to 8,000 pounds. D. Spink, A.G. Thomson,., P e r s o n a l I n t e r v i e w s . 38. J . Shaw, P e r s o n a l Interview. 39. See the commodity r a t e s e s t a b l i s h e d i n CFA-263. LABOR UNION RESPONSE TO INTERMODAL CONTAINERS "Containerization is a wonderful bit of progress; at a time of high unemployment, they have figured out a way to increase the number of jobless." . . . . A Vancouver Longshoreman.-The previous Chapter dealt with the major deterrent to intermodal OCP freight movement (cargo density and rates), but another factor, labor is also very important. To some extent this problem is reflected in the rates and tariffs, but because of its importance a more inclusive discussion of labor's response to containers is undertaken here. This Chapter presents a general world-wide longshore union reaction to containerization, followed by a study of specific areas that have influenced the reaction of the dock workers in Vancouver. The effects of competition are illustrated in the reactions of European unions, while the major U.S. dock unions have been able to 'negotiate' from a position of strength. The current labor contract in the Port of Vancouver shows the influence of both these positions. A discussion of eastern Canadian dock labor problems is also included because the containerization response of Seattle, New York, and Montreal longshoremen may well be the deciding factor as to whether OCP traffic as presently constituted, wi l l continue to move through Vancouver, o r whether i t w i l l be d i v e r t e d to S e a t t l e , New York, H a l i f a x - S t . John, o r the Quebec p o r t s . LABOR UNION RESPONSE TO CONTAINERIZATION Before any c o n c l u s i o n s or d e c i s i o n s r e g a r d i n g the growth r a t e of ( i n use) c o n t a i n e r i z a t i o n can be determined, a d e t a i l e d a n a l y s i s of l a b o r ' s p o s i t i o n v i s a v i s c o n t a i n e r s must be undertaken. C u r r e n t l y , B r i t i s h , American, and Canadian longshore unions possess the power to d i c t a t e to the ' s h i p p i n g i n d u s t r y * the terms under which c o n t a i n e r s may be moved. I f the Japanese longshore unions possess t h i s power, they have not 1 e x e r c i s e d i t up to t h i s time. I n many cases, i n c l u d i n g Vancouver, the union's demands and power have almost completely n u l l i f i e d the advantages t h a t m e c h a n i z a t i o n and u n i t i z a t i o n of cargo ( i n t o c o n t a i n e r s ) o f f e r e d f o r u n d i s t u r b e d door-to-door movement. The ' d e s t u f f i n g ' or ' s t r i p p i n g ' c l a u s e s i n the longshore c o n t r a c t s have g r e a t l y l e s s e n e d the c o s t s a v i n g s t h a t should r e s u l t from r e d u c t i o n s i n p i l f e r a g e , breakage and s h o r t a g e s ; as a r e s u l t i n s u r a n c e r a t e s have not been decreased as expected and p r e d i c t e d . Expected time savings are a l s o g r e a t l y reduced. REDUCED HANDLING EXPECTED TO LOWER INSURANCE COSTS One of the major advantages proposed f o r containerization of cargo was the marked reduction i n the number of times that i n d i v i d u a l items or packages of cargo would be handled manually. This was supposed to lead to lower insurance costs. Certainly employees of the shipper and consignee must continue moving each i n d i v i d u a l package, but t r u e l y intermodal cargo transfer ( i n containers) presents only a sealed 'box' f o r each and every c a r r i e r employee to handle. Compare t h i s with up to 20 (more, i f transhipment i s necessary) i n d i v i d u a l handlings using the t r a d i t i o n a l break-bulk method, (see Figure 5»1) To have a container stuffe d i n the CFS at one port, and destuffed at another port's CFS eliminates only 4 or 5 handlings, and t h i s s t u f f i n g and des t u f f i n g must s t i l l be done on the waterfront by longshore labor. Granted not a l l cargo w i l l be handled t h i s often even under break-bulk methods, but some cargo which i s containerized during part of i t s journey may s t i l l have two dozen manual handlings. Damage and breakage incurred i n some of these shipments has been extensive i n some instances, and i t can be d i r e c t l y a t t r i b u t e d to the f a c t that the goods were handled so 2 often before being a c t u a l l y placed i n a container. Handling damage and breakage losses have not been eliminated by the introduction of containerization because of shipper, c a r r i e r , or labor reluctance, or i n a b i l i t y to accept and u t i l i z e c o n t ainerization to the f u l l e s t extent. As a r e s u l t insurance rates have not decreased. FIGURE 5.1 NUMBER OF TIMES CARGO • IS HANDLED FROM SHIPPER TO THE CONSIGNEE SHIPPER'S WAREHOUSE Truck Stowed i n T a i l Gate Truck . . TRUCK — — — ~ > Unload Stored i n Load i n Truck F r e i g h t Shed R a i l c a r RAIL — — — Unload S t o r e i n Move to Load Stow R a i l F r e i g h t S h ip's Aboard i n — Boxcar Shed Tackle Ship Hold p — OCEAN TRIP — -~~ L i f t P l a c e Move to St o r e d and Loaded ' from on F r e i g h t S o r t e d i n i n t o -Hold Wharf Shed F r e i g h t Shed Boxcar , Unload S t o r e d i n Load i n t o Truck F r e i g h t Shed Truck j — TRUCK — Unload Consignee's Truck Dock CONSIGNEE'S WAREHOUSE A second reason why insurance rates have not been lowered, (and in some cases have actually been increased), is that entire containers have 3 (1) been lost overboard, (2) had their cargo partially or completely destroyed because of faulty packing, or (3) been stolen intact from the waterfront, or while in 5 transit. Understandably the carriers and dock operators are reluctant to talk about thefts from their faci l i t ies , but the potential for a very substantial loss exists. Significantly, insurance rates have not been decreased, although this may be due primarily to the large l i ab i l i ty that container carriers could incur for each container. CONTAINERIZATION RESULTS IN INCREASED HANDLING SPEED Whereas manual handling of break-bulk cargo occurs at rates of 10 - 25 tons/hour/hatch, a single-crane container terminal may easily handle 15 to 20 containers of up to 20 tons each per hour. It has been noted that a "conventional ship working six hatches can average 1200 tons a day (while) a container ship worked by only two cranes can easily do 3 or 6 4 times that quantity in the same period of time". At the same time as the tonnage handled is being increased 10 fold, the number of dock workers required might theoretically 7 be decreased by 80$. Assuming the remaining labor force were the more s k i l l e d and dependable men (and thus would draw h i g h e r wages) savings of the or d e r of 50$-60$ should be p o s s i b l e . That these savings have not m a t e r i a l i z e d i s a d i r e c t ' t r i b u t e * to the s t r e n g t h of the longshore unions, or the weakness of management. Reduction i n P o r t Numbers Because of the l a r g e and e x t e n s i v e investment i n ocean-going c o n t a i n e r s and v e s s e l s , the number of p o r t s must be h e l d to a minimum, as must the time t h a t a v e s s e l spends i n any-p a r t i c u l a r p o r t . T h i s i m p l i e s i n c r e a s e d e f f i c i e n c y and p r o d u c t i v i t y o f c o n t a i n e r t e r m i n a l p o r t l a b o r , with a c o i n c i d e n t d e c l i n e o r e l i m i n a t i o n of demand f o r l a b o r a t the larger number of p o r t s which l o s e out i n the ' c o n t a i n e r r a c e * . That t h i s type of economic r a t i o n a l i z a t i o n of p o r t f a c i l i t i e s has not m a t e r i a l i z e d i s a g a i n a d i r e c t r e s u l t o f the s t r e n g t h of the longshore unions, accompanied by the wide-spread ' f e a r ' of 'automation* among s u r f a c e t r a n s p o r t mode unions a n d " n a t i o n a l i s t i c p o l i t i c a l d e c i s i o n s by governments. I t i s understandable t h a t workers do not wish to see t h e i r jobs d i s a p p e a r , but a t the same time, the unions by t h e i r r e s t r i c t i v e demands seem to be e n s u r i n g t h a t an e v e n t u a l e l i m i n a t i o n of union jobs w i l l r e s u l t . However the steamship owners, agents, and s t e v e d o r i n g o p e r a t o r s are f a r from blameless i n t h i s problem, because of t h e i r almost u n i v e r s a l i n a b i l i t y to p r o v i d e a 'strong u n i t e d management approach* to union demands. The p o r t s where union power has been curbed have been s u b j e c t e d to government d i r e c t i o n and/or v e r y keen c o m p e t i t i o n . WHO BENEFITS FROM CONTAINERIZATIONt LA30R, MANAGEMENT, OR BOTH Employers and o p e r a t o r s express the o p i n i o n t h a t the advent of c o n t a i n e r i z a t i o n w i l l b e n e f i t the dock worker, both i n wages and i n job o p p o r t u n i t i e s , as there c o n t i n u e s to be a " s u b s t i t u t i o n o f c a p i t a l i n t e n s i v e systems f o r the l a b o r 8 i n t e n s i v e p r a c t i c e s i n h e r i t e d from the days of s a i l and steam". They know t h a t the c o n t a i n e r t e r m i n a l worker has a l e s s p h y s i c a l l y e x hausting, but h i g h e r s k i l l e d job to perform; the expected r e s u l t s b e i n g h i g h e r pay and more job s e c u r i t y . However the employers have as y e t been unable to convince the union l e a d e r s and e x e c u t i v e s t h a t the p r o g r e s s b e i n g sought means changes i n the p a t t e r n s of thought, a c t i o n s , and jobs, but not the e l i m i n a t i o n of the c u r r e n t l y employed l a b o r f o r c e . T r a d i t i o n a l l y "longshore o p e r a t i o n s have been v e r y much a c a s u a l i z e d i n d u s t r y , where people are h i r e d with a 1 0 0 $ t u r n over every day. I t ' s o n l y i n the p a s t few years t h a t dock o p e r a t o r s have been a b l e to encourage a r e g u l a r work f o r c e and permanent employees". 9 A t the same time however, the longshore unions are t r y i n g to d i s s o l v e the permanent work f o r c e . "They want to make i t so t h a t every man r e g i s t e r e d with the union gets some work, r a t h e r than t r y i n g to p r o t e c t the permanence o f the employment o f the men p r e s e n t l y working." 1 0 The whole argument i s based on a d e t e r m i n a t i o n of who w i l l reap the b e n e f i t s of c o n t a i n e r i z a t i o n . The s h i p owners have large capital investments in vessels and containers, and the ports and dock operators have substantial (although smaller) investments in shoreside faci l i t ies . Both these groups measure their benefits in terms of higher productivity of the invested dollar, i .e . a greater tonnage moved per man per shift hour. This mea.ns either a higher through-put with the same size work force, or an equal volume moved with a smaller work force. The only way the longshore unions visualize their members benefiting from containerization is by either (1) being paid high wages whether they work or not, or (2) being 'guaranteed work* through very restrictive containerization clauses in their contracts. Their reasoning is that the total man-tons handled wil l be the basis of payment, as this determines the number of hours worked. The union is unconcerned whether this means handling one ton 10 times, or ten tons once. The Union Locals do not expect a 10 fold increase in traffic, so they have opted for the 'make work' clauses, although they have occasionally been willing to U accept payment for not working. One of the most forceful presentations of the dock worker union's case regarding containerization was made in October 1968, by Thomas W. Gleason, President of the International  Longshoremen's Association (ILA), as he attempted to justify the Union's demand for a .60% wage increase. He maintained that the advent of containerization spelled 'doom' for the long-shoremen! that the industry was intent on replacing men with 'boxes'. However he claimed that the ILA was equally determined to reap i t s f a i r share of the benefits of contain-e r i z a t i o n . "Management must not expect to take i t a l l . Part 12 of the gain must be shared with the dockworkers." The unions have claimed that t h e i r demands f o r large wage increases are j u s t i f i e d by the savings and p r o d u c t i v i t y increases that accrue from containerization. But at the same time the unions have struck f o r ' s t u f f i n g ' and 'str i p p i n g ' clauses to be written into t h e i r contracts. The Wall Street Journal noted t h i s paradox when i t said e d i t o r i a l l y : "Thus the union wants a pay raise based on a r i s e i n pr o d u c t i v i t y and at the same time ( i t ) wants to eliminate the alleged basis f o r the boost. Anyone who finds t h i s surprising...has been out of touch l a t e l y with maritime labor's maneuvers." 13 I f the unions r e a l l y wish to see t h e i r members share i n the benefits of containerization, without wholesale loss of jobs due to lack of work, i t would appear desirable and to the dock worker's advantage, to i n s i s t on an e f f e c t i v e ban on h i r i n g s (as has been done i n Montreal). Then the benefits of containerization would accrue to the present work force. However the longshore unions (and p a r t i c u l a r l y the m i l i t a n t ILA), have usually been unwilling to accept such a ban, p r e f e r r i n g instead to allow an increase i n numbers even to the detriment of the e x i s t i n g members' employment and earnings. The f o l l o w i n g s e c t i o n p r e s e n t s a b r i e f survey of the response o f dock workers to c o n t a i n e r i z a t i o n i n C o n t i n e n t a l Europe, the U n i t e d Kingdom, E a s t e r n and Western U n i t e d S t a t e s , and Canada with s p e c i a l emphasis on the Canadian and the U n i t e d S t a t e s P a c i f i c Northwestern p o r t s and unions. CONTINENTAL EUROPE C o n t a i n e r i z a t i o n , accompanied by the i n t r o d u c t i o n o f " t h r e e - s h i f t , multi-purpose b e r t h s , and the u n q u a l i f i e d 14 a d o p t i o n o f mechanical h a n d l i n g equipment", has been remarkably w e l l accepted i n a l l n o n - E n g l i s h speaking n a t i o n s . T h i s may be due to an absence of b r o t h e r l y l o v e between dock worker unions, but i n a r e g i o n w i t h s h o r t g e o g r a p h i c a l d i s t a n c e s between p o r t s , each n a t i o n and each p o r t i s l i t e r a l l y competing w i t h a l l i t s n e i g h b o r s , "and t h i s c o m p e t i t i v e f e e l i n g i s apparent from top management down to the youngest a p p r e n t i c e " With e x t e n s i v e r a i l and road l i n k s c r i s s - c r o s s i n g North West Europe, no p o r t can expect to compete f o r long , i f i t a l l o w s i t s charges to get out of l i n e with i t s n e i g h b o r s . T h i s i s a l e s s o n to which the dock workers have made an e c o n o m i c a l l y r a t i o n a l response. '•THE UNITED KINGDOM The major B r i t i s h p o r t s have been the s u b j e c t of "over l a b o r . The Rochdale Report, submitted to P a r l i a m e n t i n September 1962, d e a l t w i t h harbor a d m i n i s t r a t i o n i n g e n e r a l "as w e l l as with the s t a t u s o f dockworkers, to w i t , d e c a s u a l -17 i z a t i o n and t r a i n i n g " . However 2 years l a t e r , " d e c a s u a l -i z a t i o n had not s i g n i f i c a n t l y p r o g r e s s e d and the p o r t s of Great B r i t a i n . . . w e r e plagued with l a b o r d i s s a t i s f a c t i o n and 18 w i l d c a t s " . As a r e s u l t , the D e v l i n I n q u i r y i n t o d e c a s u a l -i z a t i o n and "causes of d i s s e n t i o n " was e s t a b l i s h e d . The D e v l i n Report was p r e s e n t e d to P a r l i a m e n t i n 1965, and o rdered implemented by September 15» 196?. T h i s was expected to usher i n a "new e r a of c o - o p e r a t i o n 19 between employers and unions" i n B r i t a i n . The r e s u l t s were d i s a p p o i n t i n g : p r o d u c t i v i t y f e l l 25$; T i l b u r y (London) dock workers r e f u s e d to handle c o n t a i n e r s of the two A u s t r a l i a n Trade c o n s o r t i a (Overseas C o n t a i n e r s L t d . , and A s s o c i a t e d 20 C o n t a i n e r T r a n s p o r t ) 5 an expensive and c r i p p l i n g dock s t r i k e o c c u r r e d i n 1969? and the P o r t o f L i v e r p o o l was f o r c e d to the 21 p o i n t of v i r t u a l bankruptcy by January 1 s t , 1971. The B r i t i s h dock l a b o r problems have ce n t e r e d on the q u e s t i o n of 'who does what' a t both the CFS and a t l o c a t i o n s away from the docks. Union l e a d e r s i n s i s t e d t h a t t h e i r members be g i v e n j u r i s d i c t i o n over the ' s t r i p p i n g ' and ' s t u f f i n g ' of c o n t a i n e r s , a p o i n t the employers were u n w i l l i n g to concede. A work stoppage r e s u l t e d and "to the u t t e r s u r p r i s e and b e n e f i t o f c o n t i n e n t a l dock w o r k e r s . . . c o n t a i n e r s bound (to) and from A u s t r a l i a (had) to be t r a n s f e r r e d to and from Antwerp and Rotterdam (at) an a d d i t i o n a l c o s t reputed to be JC50 per c o n t a i n e r " . 22 While the switch to European ports was not permanent, the costs involved were considerable, and the vulnerability of every non-competitive European port has been emphasised. THE UNITED STATES EAST COAST The International Longshoreman's Association is comprised of a number of autonomous Union Locals which negotiate as a group, and have adhered to a policy of 'striking' a l l East Coast U.S. ports, unless a l l have agreements in force at the same time. In practice this policy has meant that the New York (ILA) Local would negotiate with the New York Shipping Association (NYSA), and their collective agreement established the pattern for a l l U.S. East Coast port agreements. 1 9 6 8 Contract Negotiations Negotiations on the 1 9 6 8 contract began 4 months before expiry of any of the ILA contracts. However agreement could not be reached and a 5 ^ day strike resulted. A complicating feature of the 1 9 6 8 negotiations was the division which developed in the stand taken by the various ports. # The ILA is the single bargaining unit for the entire port's many locals dealing with the New York Shipping Association. The NYSA is a "membership corporation" composed of approx-imately 140 steamship companies, stevedores, and other waterfront employers in the Port of New York. compete as successfully as the Port of New York Authority (PNYA) for the containerized trade, these ports were unwilling, and perhaps unable to accept the terms of the NYSA-ILA Agreement. As a result some of the Eastern U.S. ports remained 'struck* for almost 100 days. Losses were estimated as high 24 as $15 million daily. Longshore Agreement Container Clauses The agreements finally reached between the various Shipping Associations and the ILA Locals a l l contained the '50-mile' clause which stated that a l l containers originating from, or destined to, points within 50 miles of the dock must- be "stuffed and stripped by ILA labour at longshore rates on a waterfront fac i l i ty" . (see Appendix XII) Failure to have the designated containers handled in this manner brought into action a penalty clause which required that the Steamship Company pay •liquidating damages of $250 per container' to the Welfare Fund. In June 1970, the matter of ' local ' containers being moved across the waterfront and paying the penalty rather than being handled by ILA labor on the dock was brought to a head. The ILA President ordered the dockers 'to strip and s tuf f a l l containers (except the through-put units) and in two days, this action completely jammed the piers. After negotiations, the NYSA agreed to the ILA demand that the penalty be raised to 25 $1,000.00 per container. t h a t the p a c k i n g and unpacking of c o n t a i n e r s must be done by ILA employees " a t w a t e r f r o n t p i e r s and docks". The f a c t t h a t the s t u f f i n g of c o n t a i n e r s was done by ILA l a b o r a t premises l o c a t e d i n the dock a r e a " c a r r i e d no weight ( i f ) the p a c k i n g 26 was not done on the w a t e r f r o n t " . However measures t h a t p r o t e c t l a b o r "are c a u s i n g many users to look c l o s e l y a t o t h e r p o r t s not covered" by such r e s t r i c t i v e c l a u s e s , "The i n t e r e s t i n E a s t e r n Canadian p o r t s where no compulsary s t r i p - a n d - s t u f f c l a u s e s e x i s t and no r o y a l t y 27 payments are p a i d , i s a prime example." THE UNITED STATES WEST COAST I n c o n t r a s t to the t u r b u l e n t h i s t o r y of the ILA and c o n t a i n e r i z a t i o n on the A t l a n t i c Coast, the U.S. P a c i f i c Coast 28 has been r e l a t i v e l y calm s i n c e i960. Whether t h i s s i t u a t i o n w i l l p e r s i s t through the summer of 1971 remains a debateable 29 q u e s t i o n a t the p r e s e n t time. Because the P o r t of S e a t t l e i s a p a r t y to the p r e s e n t West Coast Agreement, a b r i e f h i s t o r y o f the f a c t o r s i n v o l v e d i n the acceptance and terms of the Agreement are p r e s e n t e d here. The dock workers are members of the I n t e r n a t i o n a l Longshore-men's and Warehousemen's Union (ILWU), while the Steamship owners and Agents, and S t e v e d o r i n g Companies n e g o t i a t e through a committee c a l l e d the P a c i f i c Maritime A s s o c i a t i o n (PMA). Negotiations aimed at defusing the (then) troubled West Coast labor s i t u a t i o n regarding the introduction of mechan-i z a t i o n and containerization began i n 1956• Harry Bridges, President of the ILWU made a ' r a d i c a l ' proposal to the ILWU delegate caucus i n March 1956 when he said: "We have r e s i s t e d the impact of labor-saving machinery, mechanization, automation...possibly with greater success than any other organization. I t has (now) become a l o s i n g battle...We can continue to f i g h t a l o s i n g b a t t l e , and we w i l l lose i n more ways than one and f i n a l l y a f t e r we have thrown away a l o t of energy and a l o t of bargaining power, we w i l l put on a showdown, last-stand f i g h t , and we w i l l lose that one too." 30 The President's approach was not well received as the delegates favored mechanization only so f a r as i t made the dock worker's job easier, but they rejected his idea that they give up men on the job. However Bridges persisted, and was eventually able to persuade the 'rank and f i l e ' to endorse mechanization as a f i n a n c i a l benefit i n which both the steamship owners and the waterfront workers could share. Container Clauses i n The Agreement In October i960, the ILWU and the PMA signed the West Coast Mechanization and Modernization Agreement, which has since become known as the 'peaceful agreement'. I t contained the provision that the "benefits of mechanization and modernization 31 should be shared with the workers". The settlement provided that the dock workers would s e l l t h e i r 'property r i g h t s ' of res-t r i c t i v e labor practices f o r a lump sum payment t o t a l i n g $10 million, payable over 5 y e a r s , with the monies to be p a i d i n t o a j o i n t l y (ILWU-PMA) a d m i n i s t e r e d wage-guarantee fund. An a d d i t i o n a l "$15 m i l l i o n r e p r e s e n t i n g the workers share i n the a n t i c i p a t e d p r o f i t s from i n c r e a s e d p r o d u c t i v i t y " was p a i d i n t o a p ension fund over the f i v e years t h a t the c o n t r a c t was i n 32 f o r c e . Only minor changes were deemed n e c e s s a r y when the c o n t r a c t came up f o r renewal i n 1966. Outlook For 1971 Economic and p o r t c o n d i t i o n s have changed c o n s i d e r a b l y s i n c e 1966. The major a l t e r a t i o n has been the r a p i d c o n v e r s i o n of the P a c i f i c t r a d e from domestic, to i n t e r n a t i o n a l c o n t a i n e r -i z a t i o n a t a l e v e l r a p i d l y approaching t h a t of, the A t l a n t i c . Other f a c t o r s almost c e r t a i n to p r o v i d e s u f f i c i e n t l a b o r u n r e s t t h a t a U.S. West Coast dock workers s t r i k e w i l l develop i n the summer o f 1971, are (1) the i n t r o d u c t i o n o f Japanese, A u s t r a l i a n and European c o n t a i n e r i z a t i o n cargo."::-; to the P a c i f i c Coast p o r t s , (2) the ' e f f e c t i v e n e s s * o f the E a s t Coast ILA s t r i k e i n 1968, (3) the 'success' o f the c o n t a i n e r i z a t i o n c l a u s e of the 1970 Vancouver ILWU c o n t r a c t , and (4) the growing r e a l i z a t i o n of what t r u l y i n t e r m o d a l c o n t a i n e r t r a f f i c can mean to the modern p o r t ' s l a b o r f o r c e . S hould a s t r i k e develop, the c o - o p e r a t i v e a t t i t u d e e x h i b i t e d by both the ILWU and the PMA over the p a s t 10 ye a r s demands. It appears almost certain that West Coast ILWU negotiating teams w i l l not settle for less than the current Vancouver ILWU Local has achieved regarding a containerization 33 clause, and the American Unions may well demand more. EASTERN CANADA Up to the present time, the introduction of containerization does not appear to have been a contributing factor in any Atlantic coast or St. Lawrence River port labor disputes. Apparently, enough other factors existed that this additional one was unnecessary ( i f one may judge by the findings of a 34 number of port labor inquiries held in the last 10 years). Montreal and Quebec City with (1) numerous longshore disputes, (2) low labor productivity, (3) an unfavorable geographical location because of winter ice conditions and a slow water journey, and (4) a lack of cargo security, have witnessed a transfer of considerable quantities of cargo to other ports particularly Halifax, St. John (N.B.), Boston, and New York. Labor Minister Mackasey, in discussing productivity at Canadian East Coast ports, indicated that from 1964 to 1969, the productivity of Montreal longshoremen in terms of tons moved 35 per man hour had declined by 26%. He added that in absolute terms Montreal handled one-third less tonnage/hour, and took twice as l o n g to unload a v e s s e l as d i d S t . John. When these a c t i o n s r e s u l t e d i n a d i v e r s i o n of cargo to o t h e r p o r t s , the longshoremen r e t a l i a t e d by t a k i n g even l o n g e r to unload cargo. Labor I n q u i r i e s C o n d i t i o n s on the S t , Lawrence w a t e r f r o n t p i e r s became so bad t h a t the F e d e r a l Government s e t up two i n q u i r i e s i n an attempt to determine ways, to l e s s e n the l a b o r problems. Dr. P i c a r d ' s ( 1 9 6 7 ) I n q u i r y recommended a decrease i n gang s i z e and improved working c o n d i t i o n s , w i t h the broad o b j e c t i v e o f a c h i e v i n g " r a t i o n a l i z a t i o n o f o p e r a t i o n s , s t a b a l i z a t i o n of work, and g e n e r a l improvement i n working c o n d i t i o n s " a t the 37 M o n t r e a l , Quebec, and T r o i s - R i v e r e s p o r t s . 38 The A r t h u r I . Smith I n q u i r y , dated October 2 , 1 9 6 9 , r e c o v e r e d much of the same ground as the P i c a r d Report. The g e n e r a l tone of the Smith Report was t h a t l i t t l e improvement i n the longshore s i t u a t i o n had r e s u l t e d from the P i c a r d I n q u i r y and the 1 9 6 8 c o n t r a c t . He blamed a weak and d i v i d e d management as the p r i n c i p l e reason f o r an u n d i s c i p l i n e d and i n e f f i c i e n t l a b o r f o r c e . C o n t a i n e r i z a t i o n Clauses The l a b o r agreement between the Canadian ILA unions and the employers i n the S t . Lawrence R i v e r p o r t s , s i g n e d i n 1 9 6 8 , and based on the f i n d i n g s of the P i c a r d I n q u i r y , i s one of the most f a v o r a b l e anywhere to c o n t a i n e r o p e r a t o r s . That agreement p r o v i d e d f o r a f r e e z e on union membership, a r e d u c t i o n i n the number of men per gang, and a guaranteed wage f o r the longshoremen to be f i n a n c e d by a l e v y upon cargo g o i n g through the p o r t s . Most important f o r c o n t a i n e r i z e d cargo, the c o n t r a c t c o n t a i n e d no ' s t u f f i n g * and/or ' s t r i p p i n g ' c l a u s e s . These c l a u s e s may be demanded i n the next c o n t r a c t to guard a g a i n s t a re-occurance o f the bankruptcy o f t h e i r guaranteed wage fund as happened i n 19^9, but a p p a r e n t l y , the ILA members have not become m i l i t a n t on t h i s matter. The volume of t r a f f i c moving to the A t l a n t i c Coast and G r e a t Lakes p o r t s d i r e c t l y from OCP o r i g i n n a t i o n s v i a the Panama Canal has been c o n s i d e r a b l e . (see Table 3.12) T h i s volume c o u l d be s u b s t a n t i a l l y i n c r e a s e d , i f the i n t r o d u c t i o n of f u l l y c e l l u l a r c o n t a i n e r v e s s e l s on the Japan-Panama C a n a l -E a s t Coast North America run i n 1972 c o i n c i d e d w i t h (1) l a b o r problems i n Vancouver and/or S e a t t l e , (2) a r e d u c t i o n i n the f a v o r a b l e s t a t u s many goods p r e s e n t l y enjoy when moving a t OCP ocean r a t e s i n c o n j u n c t i o n w i t h the r a i l and steamship a b s o r p t i o n s of t e r m i n a l charges, (3) f a i l u r e by the i n l a n d c a r r i e r s to e s t a b l i s h c o m p e t i t i v e t r a n s c o n t i n e n t a l c o n t a i n e r r a t e s , o r (k) l a b o r c o n t r a c t s i n E a s t Coast p o r t s t h a t prove more f a v o r a b l e to c o n t a i n e r i z e d shipments moving i n t e r m o d a l l y than the agreements i n Vancouver and/or S e a t t l e . 39 CONTRACT NEGOTIATION PROBLEMS One o f the most p r o t r a c t e d l a b o r n e g o t i a t i o n s i n Vancouver p o r t h i s t o r y between The I n t e r n a t i o n a l Longshoremen's and Warehousemen's Union (ILV/U) and the Canadian Maritime Employees A s s o c i a t i o n (CMEA) o c c u r r e d i n 1969-1970. Formal c o l l e c t i v e b a r g a i n i n g n e g o t i a t i o n s c o n t i n u e d f o r 10 months b e f o r e an agreement was signed, but i n f o r m a l d i s c u s s i o n s on the whole concept on the changing p o r t o p e r a t i o n had taken p l a c e f o r 3 y e a r s . The B.C. S h i p p i n g I n d u s t r y had g r a d u a l l y f a l l e n behind i t s c o m p e t i t o r s with r e s p e c t to , the types of s h i p s employed and the methods of h a n d l i n g cargo. Suddenly changes, p r e v a l e n t i n so many a r e a s , caught up to the P o r t of Vancouver. A new b u l k l o a d i n g f a c i l i t y a t Roberts Bank was opened, the new c o n t a i n e r t e r m i n a l a t C e n t e n n i a l P i e r was no l o n g e r a 'proposed p l a n ' , new s p e c i a l i z e d v e s s e l s were docking, a l t e r a t i o n s i n the s t r u c t u r e and r o l e of the N a t i o n a l Harbour's Board were underway, and a change i n the demographic s t r u c t u r e of both union and management had o c c u r r e d . A c t u a l n e g o t i a t i o n s began i n A p r i l 1969, months b e f o r e e x p i r a t i o n on J u l y 31, of the o l d agreement and c o n t i n u e d u n t i l September 25th. When no s e t t l e m e n t had been reached by t h a t date, the ILWU s t r u c k the w a t e r f r o n t i n a s t r i k e which l a s t e d f o r s i x weeks. However n e g o t i a t i o n s c o n t i n u e d and t e n t a t i v e agreements were reached on October 17th, November 1 s t , and January 31st. Each one i n t u r n was r e j e c t e d by the ILWU membership. A f o u r t h s e t t l e m e n t , reached on February 9th, was f i n a l l y a c c e p t e d by a narrow 55$ a f f i r m a t i v e vote of the u n i o n membership. Work resumed February 13th, with implem-e n t a t i o n of the new c o n d i t i o n s t a k i n g p l a c e on February 23, 1970. The c o n t r a c t e x p i r e s J u l y 31, 1972. E.M. S t r a n g , P r e s i d e n t of B.C. Maritime Association*-commented on n e g o t i a t i o n s as f o l l o w s : "The r e a l d i f f i c u l t y i n o b t a i n i n g acceptance by the rank and f i l e was the f e a r of change... Change comes hard, and i n an i n d u s t r y such as l o n g s h o r i n g , where a man works f o r a number of d i f f e r e n t employers, a l t e r a t i o n of o l d h a b i t s i s d i f f i c u l t . Perhaps i t i s j u s t as w e l l t h a t the time taken was as l o n g as i t was, and t h a t the matter came b e f o r e the membership so many times, because i n t h e - l o n g run i t h e l p e d to usher i n the changes t h a t are now t a k i n g p l a c e i n work h a b i t s . . . T h e r e has been some stubborn r e s i s t a n c e to the changes...but the adjustment i s t a k i n g p l a c e . R e s u l t s cannot be a n y t h i n g but b e n e f i c i a l to both p a r t i e s . " 40 D i s c u s s i o n s w i t h ' r a n k - a n d - f i l e * ILV/U members a t C e n t e n n i a l P i e r would i n d i c a t e t h a t Mr. Strang's f o r e c a s t s 41 a r e perhaps o v e r l y o p t o m i s t i c . While work i s b e i n g accomplished on the Vancouver docks, the r o u n d - t h e - c l o c k , seven-day-a-week o p e r a t i o n s are meeting s t r o n g o p p o s i t i o n from the u n i o n membership. No c e i l i n g has been p l a c e d on the number of u n i o n members, and except f o r those members with s e n i o r i t y who have been g i v e n permanent employment, the average l o n g -shoreman has n e i t h e r a guarantee of y e a r l y e a r n i n g s , nor of hours of work. Even the p r o s p e c t o f e a r n i n g $9.56 an hour f o r a week-day gr a v e - y a r d s h i f t , o r a Sunday d a y - s h i f t , i s a p p a r e n t l y not regarded as s u f f i c i e n t 'compensation' f o r h a v i n g to work these s h i f t s . ( f o r a p p l i c a b l e wage r a t e s see Appendix XI) to pay the h i g h wage b i l l s r e s u l t i n g from overtime work, and so schedule f o r as l i t t l e overtime work as f e a s i b l e , ' h o p i n g to o b t a i n r e a s o n a b l e p r o d u c t i v i t y from e x t r a gangs of 'c a s u a l l a b o r ' working with the permanent longshore gangs d u r i n g the r e g u l a r d a y - s h i f t o p e r a t i o n . Because 70$ of the imported c o n t a i n e r s a re d e s t u f f e d (and 60$ of the exported u n i t s are 42 s t u f f e d ) a t the Vancouver w a t e r f r o n t , the r e l u c t a n c e to work ' s h i f t ' , o r to h i r e overtime l a b o r , d e l a y s the f o r w a r d i n g o f cargo. Undoubtedly though, i t i s s t i l l f a s t e r than the former break-bulk methods. The extended n e g o t i a t i o n s and s t r i k e were not over c o n t a i n e r i z a t i o n i n p a r t i c u l a r , " but r a t h e r over the whole concept o f p o r t o p e r a t i o n s ( i n c l u d i n g mechanization, round-t h e - c l o c k seven-day-operation, reduced gang s i z e , and e l i m i n a t i o n o f work r e s t r i c t i o n s ) . However the c o n t a i n e r i z a t i o n 43 " c l a u s e was a key to f i n a l i z i n g the agreement". CONTRACT CONDITIONS REGARDING CONTAINERIZATION C o n t a i n e r Clause B a s i c a l l y the deep-sea c o n t a i n e r c l a u s e i n the ILWU-CMEA Agreement, #26.05 (see Appendix XI f o r a c t u a l wording) p r o v i d e s t h a t any c o n t a i n e r b e i n g imported i n t o Canada, through the P o r t of Vancouver must be d e s t u f f e d on the Vancouver w a t e r f r o n t by ILWU l a b o r u n l e s s t h a t c o n t a i n e r meets one of the two f o l l o w i n g conditions» (1) i t must have a d e s t i n a t i o n t h a t i s o u t s i d e the f o l l o w i n g areas the Vancouver L o c a l a r e a comprised of the lower B.C. Mainland e a s t as f a r as Hope (B.C.), south to the U.S.A.-Canadian border, a l l of Vancouver I s l a n d , or the P r i n c e Rupert L o c a l P o r t a r e a j or (2) the e n t i r e contents of t h a t c o n t a i n e r are owned by the consignee, and t h a t c o n t a i n e r i s b e i n g moved d i r e c t l y to a warehouse f a c i l i t y owned and maintained by the consignee, v/ith the e n t i r e contents to be d e s t u f f e d by t h a t consignee a t t h a t owned f a c i l i t y , with the c o n t a i n e r then b e i n g r e t u r n e d d i r e c t l y to the P o r t of Vancouver w a t e r f r o n t a r e a . S i m i l a r r e s t r i c t i o n s are p l a c e d on a l l export-bound c o n t a i n e r s >(i«e. they must be s t u f f e d on the Vancouver w a t e r f r o n t by ILWU l a b o r ) u n l e s s these c o n t a i n e r s meet the f o l l o w i n g c o n d i t i o n s : (1) they o r i g i n a t e o u t s i d e the a r e a d e s i g n a t e d above, or (2) the e n t i r e c o n t a i n e r has been s t u f f e d by the s h i p p e r ( o r h i s employees) a t the s h i p p e r ' s own warehouse, with the i n t a c t ( s e a l e d ) c o n t a i n e r then b e i n g admitted to the CY. The n e t e f f e c t of these c o n t r a c t c o n d i t i o n s has been to c o m p l e t e l y h a l t the movement of i n t a c t c o n t a i n e r s from the Vancouver w a t e r f r o n t to any B.C. Lower Mainland f r e i g h t forwarder. With dockside. d e s t u f f i n g , the p o t e n t i a l b e n e f i t s from fewer h a n d l i n g s i s g r e a t l y reduced, and the cargo i s s t i l l s u b j e c t e d to the ' p i l f e r a g e s i t u a t i o n * which has always e x i s t e d . A c o - o r d i n a t i o n of p l a n s by the consignee and the s t e v e d o r i n g companies can reduce o p p o r t u n i t i e s f o r p i l f e r a g e to almost n i l , by t r a n s f e r r i n g the c o n t a i n e r ' s contents from the imported Vancouver-CFS-destined c o n t a i n e r i n t o a w a i t i n g t r u c k , without the goods f i r s t b e i n g d e s t u f f e d and s t o r e d i n the CFS shed. A s i m i l a r , a l t h o u g h not q u i t e as e f f e c t i v e measure, oc c u r s when the goods are t r a n s f e r r e d d i r e c t l y from a c o n t a i n e r to a p o o l c a r . S i z e and S t r u c t u r e of C o n t a i n e r Crew on C e n t e n n i a l P i e r One o t h e r major c o n d i t i o n o f the Vancouver w a t e r f r o n t l a b o r c o n t r a c t has been the r e d u c t i o n of gang s i z e . E x p e rience has shown t h a t a gang of 8 men per s h i f t i s adequate to handle the l o a d i n g and d i s c h a r g e of c o n t a i n e r s from a f u l l y c o n t a i n e r i z e d v e s s e l a t C e n t e n n i a l P i e r , w h i l e up to 100 men per s h i f t would be 44 r e q u i r e d on a c o n v e n t i o n a l break-bulk v e s s e l . The c o n t a i n e r h a n d l i n g crew a t Bert h #6 i n c l u d e s one crane o p e r a t o r , drawn from a p o o l of 3° ILWU members who have r e c e i v e d t r a i n i n g i n g a n t r y crane o p e r a t i o n , and 3 s t r a d d l e c a r r i e r d r i v e r s . From 6000 to 8000 tons of cargo a r e c u r r e n t l y b e i n g exchanged d u r i n g each Japan 6 v e s s e l ' s v i s i t to Vancouver' • 45 with average s h i p working time of l e s s than 48 hours. E x p e r i e n c e has a l s o improved the p r o d u c t i v i t y of the c o n t a i n e r crane h a n d l e r s from an i n i t i a l r a t e of 17 c o n t a i n e r s / h o u r (net) to the c u r r e n t r a t e o f 23 c o n t a i n e r s / h o u r ( n e t ) . (see Table 5»1) These r a t e s are o b t a i n e d u s i n g the ' s i n g l e c y c l e ' c o n t a i n e r t r a n s f e r system, r a t h e r than the 'double c y c l e * n o r m a l l y 46 employed i n c o n t a i n e r t e r m i n a l s . One major f a c t o r , which has a s s i s t e d i n improving l a b o r INITIAL VOYAGES OF JAPAN 6 LIMES 1970-: 1971 VESSEL CONTAINERS CONTAINERS CRANE AVERAGE NUMBER CONTAI TRIP DISCHARGED LOADED DELAYS HANDLED PER HOUR (number) (number) (hours) GROSS NET 1970 GA 1 252 323 7.25 15.54 18.25 GA 2 239 227 5.25 14.24 16.93 GA 3 233 272 9.50 12.80 16.87 GA 4 222 211 4.00 15.86 . 18.33 GA 5 389 610 5.00 19.30 .21.36 HM 1 338 376 6. 00 19.42- 23.24 GA 6 326 259 4.25 21.27 25.16 BM 1 371 356 6.75 19.65 24.03 HM 2 119 166 3.75 18.10 23.75 GA 7 266 207 ^.75 18.45 22.73 BM 2 372 422 8.75 17.67 21.87 HM 3 236 392 5.75 18.33 22.04 BM 3 381 558 9.25 18. 32 22.36 HM 4 296 174 3.25 19.42 22.43 1971 GA 9 377 348 4.50 20.68 23.70 BM 4 237 281 8.50 16.34 22.26 HM 5 308 296 5.75 18.88 23.00 GA 10 283 234 5.25 19.23 23.53 BM 5 487 423 k.75 20.93 23.44 HM 6 325 297 3.00 20.41 22.58 GA 11 290 370 ^.75 19.85 23.05 BM 6 395 394 6.25 16.99 19.62 HM 7 329 368 3.50 21.13 23.60 GA 12 275 290 5.00 17.94 21.32 BM 7 398 561 9.00 I8.38 22.17 HM 8 245 286 3.00 20.38 23.01 GA = Golden Arrow HM = Hotaka Maru BM = Beishu Maru-Source: F i l e s of Empire S t e v e d o r i n g , C e n t e n n i a l P i e r , Vancouver. May 1971. p r o d u c t i v i t y , has been the t r e n d to d e c a s u a l i z a t i o n of w a t e r f r o n t o p e r a t i o n s . Gordon Payne, Manager of the C o n t a i n e r T e r m i n a l , d e s c r i b e d the l a b o r s i t u a t i o n on C e n t e n n i a l P i e r as f o l l o w s : "Approximately 70$ of a l l the workers on C e n t e n n i a l P i e r each day, work o n l y f o r Empire S t e v e d o r i n g on C e n t e n n i a l P i e r . . . T h e b i g t h i n g has been to t r a i n the men...then they r e a l i z e t h a t the job t h a t they are doing today w i l l be the same tomorrow, and maybe they should endeavor to do a b i t b e t t e r job today to h e l p t h i n g s f o r tomorrow. While the crane o p e r a t o r i s not p a r t of the r e g u l a r work f o r c e , the f o r k l i f t and s t r a d d r i v e r s a r e . The crane o p e r a t o r s would be too, i f we had enough work f o r them...The p r e s e n t p a t t e r n of crane o p e r a t o r h i r i n g (from the Union D i s p a t c h H a l l ) means t h a t i n s t e a d of h i r i n g the b e s t 6 men, we o n l y have a p i c k of an average crane man...but we are sure of g e t t i n g one of the JO who have been t r a i n e d . . . A l l our key checkers are permanent work f o r c e , and of course the foremen are our f i r s t l i n e o f s u p e r v i s i o n . " 47 The Outlook With the p r e s e n t c o n t r a c t i n f o r c e u n t i l J u l y 31, 1972, the P o r t o f Vancouver s h o u l d be a s s u r e d of no major work d i s r u p t i o n s f o r some time. The u n i o n membership has changed i n c o m position, w i t h many younger and more ' f a m i l y men' now i n c l u d e d . D e c a s u a l i z a t i o n of the work f o r c e i s d e s i r e d by the employers, and even some o f the union rank and f i l e a re becoming r e s i g n e d to the i d e a . However there c o n t i n u e s to be "tremendous p r e s s u r e (from the union) to d i s s o l v e the permanent work f o r c e . . . T h e y want to make i t so t h a t every man r e g i s t e r e d w i t h the u n i o n can get some work, r a t h e r than t r y i n g to p r o t e c t the permanence of the men p r e s e n t l y working." 48 A q u e s t i o n mark f o r the f u t u r e o f c o n t a i n e r o p e r a t i o n s i n the P o r t o f Vancouver i s the d i r e c t i o n of the c u r r e n t U.S. c o n t r a c t s the American ILWU L o c a l s have not opted f o r a ' h a n d l i n g p e n a l t y ' i n the form of a cash payment f o r work not performed ( i n the manner o f the E a s t Coast ILA L o c a l s ) , p r e f e r r i n g i n s t e a d to 'share i n the b e n e f i t s ' . A t p r e s e n t , the U.S. West Coast ILWU members are a t t e m p t i n g to n e g o t i a t e a ' s t u f f i n g and s t r i p p i n g ' c l a u s e l i k e t h a t c u r r e n t l y i n f o r c e on the Vancouver w a t e r f r o n t . "In f a c t they may go f u r t h e r than the Vancouver c o n t r a c t s e e k i n g a d e f i n e d a r e a of up to 200 m i l e s " 49 from the p o r t c e n t e r . However even i f they were to extend the d i s t a n c e and o b t a i n perhaps a 500 m i l e l i m i t , " i t i s most 50 u n l i k e l y to extend p a s t the Canada-U.S. border". The ILWU members of Mexico, C a l i f o r n i a , Oregon, Washington, and B r i t i s h Columbia have never r e a l l y h e l p e d each o t h e r d u r i n g a s t r i k e , w i t h the r e s u l t t h a t when one L o c a l was on s t r i k e , the work c o u l d e a s i l y be d i v e r t e d to another p o r t . The union L o c a l a t the d i v e r s i o n p o r t has always been w i l l i n g to handle the added work. In f a c t , s t r i k i n g members of one L o c a l have been known to work a t another p o r t w h i l e t h e i r own c o n t r a c t was b e i n g s e t t l e d . The n e t r e s u l t o f t h i s s i t u a t i o n , as f a r as the P o r t s o f S e a t t l e and Vancouver are concerned may be " t h a t an i n t e r c h a n g e of c o n t a i n e r s between p o r t areas can p r o b a b l y be expected. T h i s would mean t h a t the Canadian c o n t a i n e r i z e d cargo i s going to be d i s c h a r g e d i n S e a t t l e and moved by r a i l to the Vancouver a r e a f o r d i s t r i b u t i o n or c o n s o l i d a t i o n , with a l l goods consigned to S e a t t l e b e i n g d i s c h a r g e d i n Vancouver. T h i s i s t e r r i b l y i l l o g i c a l , y e t the s h i p p e r and the buyer are going to be f o r c e d to handle t h e i r commodities t h i s way." 51 SUMMARY The B r i t i s h and American dock l a b o r scene has been one of t u r b u l e n c e and u n r e s t f o r many years over the q u e s t i o n of 'who does what' as p o r t s t u r n to g r e a t e r mechanization i n an e f f o r t to i n c r e a s e p r o d u c t i v i t y . The ocean s h i p p i n g i n d u s t r y ' s b i g c h a l l e n g e has been to persuade the l a b o r unions to a c c e p t c o n t a i n e r i z a t i o n and o t h e r t e c h n o l o g i c a l advances, which must i n e v i t a b l y l e s s e n the demand f o r l a b o r . To date the i n d u s t r y has been n o t a b l y u n s u c c e s s f u l , as the unions have demanded and o b t a i n e d r o y a l t y r i g h t s , d e s t u f f i n g c l a u s e s , and/or the 52 r e t e n t i o n of unnecessary p o s i t i o n s . I f the c u r r e n t l y p r o j e c t e d growth r a t e s f o r c o n t a i n e r i z a t i o n i n the P o r t of Vancouver m a t e r i a l i z e , c o n t a i n e r s can be expected to a r r i v e and d e p a r t a t a through-put r a t e of 40,000 to 60,000 53 'boxes' a n n u a l l y by the end of 1973» Whether these 'heady' volumes w i l l a c t u a l l y be a c h i e v e d or not depends on the response o f l a b o r on both the West and E a s t Coast o f North America. The unions h o l d the 'key'. Because of t h e i r power, the ILWU c o u l d r e t a r d the use of c o n t a i n e r s and d e l a y o r r e v e r s e the t r e n d to mechanization, w i t h the r i s k of doing permanent damage to the P o r t of Vancouver. L i k e w i s e , l a b o r and management c o u l d work t o g e t h e r encouraging the development of c o n t a i n e r i z a t i o n and o t h e r cargo u n i t i z i n g p r a c t i c e s , s h a r i n g i n the r e s u l t i n g b e n e f i t s , and thereby e n s u r i n g t h e i r mutual f u t u r e l i v e l i h o o d . "For t h e i r p a r t , the employers must r e c o g n i z e t h a t they have an o b l i g a t i o n to share the b e n e f i t s o f p r o d u c t i v i t y with the dockers. A t the same time...: .:.::; the dock work f o r c e can o n l y d e c l i n e through a t t r i t i o n and t h i s may take some time. I t i s t h e i r job to persuade the e x i s t i n g longshoremen t h a t the p r a c t i c e of f e a t h e r b e d d i n g w i l l do the worker g r e a t harm i n the l o n g run." 54 I f e i t h e r p a r t y i g n o r e s t h e i r p a r t i n the c o n t a i n e r i z a t i o n r e v o l u t i o n on Canada's West Coast, the P o r t of Vancouver c o u l d w e l l become a ' c a s u a l t y ' . Management and l a b o r i n the P o r t o f S e a t t l e would be o n l y too w i l l i n g to f i l l the vacuum l e f t by Vancouver's demise. CHAPTER V 1. Because of the e f f e c t i v e Japanese F e d e r a l Government a c t i o n s i n Japanese s h i p p i n g i n d u s t r i a l matters, i t i s concluded t h a t the Japanese longshore and seaman unions are not e x e r t i n g any s i g n i f i c a n t p r e s s u r e on the movement o f c o n t a i n e r s . The members of the Japan 6 Lines were f o r c e d to operate 'together' by Government decree, and the world s h i p p i n g c h a r t e r market has been v e r y s e n s i t i v e to the withdrawl of Japanese i n t e r e s t s i n the l a s t q u a r t e r o f 1970 - f i r s t q u a r t e r o f 1971. 2. Many of the goods a r r i v i n g a t C e n t e n n i a l P i e r t h a t have been t r a n s - s h i p p e d from Mainland China r e q u i r e r e - c o o p e r i n g as a d i r e c t r e s u l t o f b e i n g handled so many times :enroute. 3. "Ship C o n t a i n e r Rates Backed by McDowell", J o u r n a l of  Commerce (N.Y.), r e p r i n t e d i n "News of I n t e r e s t " , Todds Shipyards  C o r p o r a t i o n , New York. A p r i l 30? 1970. p. 5« 4. G. Payne, P e r s o n a l Interview. One shipment o f pulp i n c o n t a i n e r s on board a Japan 6 V e s s e l broke l o o s e i n a storm on the t r i p from Vancouver to P o r t l a n d , c a u s i n g e x t e n s i v e damage. 5« G. King, P e r s o n a l Interview. cf« B.Tierney, " C o n t a i n e r i z e d Cargoes,...a mixed B l e s s i n g " , The P r o v i n c e , Sept. 16, 1970. p. 5. 6. E. P a r r o t , "Cargo Handling", Paper i n P o r t of Vancouver, R.W. C o l l i e r , ed. , U.B.C, Vancouver. 1966. p. 43. c f . G. Payne, "The C o n t a i n e r Way", Speech to the I n s t i t u t e  o f Naval A r c h i t e c t s and Marine E n g i n e e r s , Vancouver. A p r i l 23, 1770. p. 9. 7. " C o n t a i n e r i z a t i o n : The Key to Low Cost Transport", Report f o r the B r i t i s h Dock A u t h o r i t y by McKinsey and Co., London. 1967. p. 57. 8. J . R o l f e , " P o r t s , S e r v i c e s and Labor Face E f f e c t s of C o n t a i n e r i z a t i o n " , Toronto Globe and M a i l , Oct. 16, 1970. p. B7. 9. G. Payne, P e r s o n a l Interview. 10. i b i d . 11. An example would be the d e s t u f f i n g p e n a l t y c l a u s e o f the U.S. E a s t Coast ILA Agreement. See pages 203-205 of t h i s study. 12. T.W. Gleason, "The L i f e and Death of the Longshoremen", Paper read a t the Baltimore C o n t a i n e r E x h i b i t i o n , B a l t i m o r e , Oct. 1968. Quoted i n f u l l i n C o n t a i n e r i z a t i o n I n t e r n a t i o n a l :  1970 Yearbook, London. 1 9 6 9 . pp. 32-35. 13. "Maritime Maneuvers", ( E d i t o r i a l i Wall S t r e e t J o u r n a l , J u l y 16, 1968. p. 16. 14. C o n t a i n e r i z a t i o n I n t e r n a t i o n a l : 1970 Yearbook, London. 1969. p. 31. 15. i b i d . , p. 40. 16. A r t h u r I. Smith, "Report of I n q u i r y Into C e r t a i n C o n d i t i o n s , Conduct, and Matters G i v i n g Rise to Labour Unrest at the P o r t s o f Montreal, T r o i s - R i v i e r e s , and Quebec, P.Q.", Canada Department of Labour, Queens P r i n t e r , Ottawa. Oct. 2, 1969. • Annex A* , p. 3« 17. i b i d . , 'Annex A', p. 4. 18. i b i d . , 'Annex A', p. 6. 19. C o n t a i n e r i z a t i o n t Yearbook; t op. c i t . , p. 38. 20. i b i d . , p. 38. 21. "Merseyside and N.W.: Confidence Re t u r n i n g " , F a i r p l a y , Jan. 7, 1971. p. 77. 22. C o n t a i n e r i z a t i o n : Yearbook, op. c i t . , p. 38. 23. " T i l b u r y - 24 Hour Working", F a i r p l a y , Jan 28, 1971. p. 10. 24. H. McDonald, "Labor and C o n t a i n e r i z a t i o n " , Unpublished M.B.A. Graduating Essay, U.B.C., Vancouver. May 1971. 25. "U.S.A. - Maritime B i l l Passed i n House", F a i r p l a y , June 25, 1970. p. 52. 26. " I n t e r n a t i o n a l C o n t i n e n t a l C o n t a i n e r T r a n s p o r t Corpor-a t i o n v§_. New York S h i p p i n g A s s o c i a t i o n , Inc. , and I n t e r n a t i o n a l Longshoremen's A s s o c i a t i o n " , F a i r p l a y , Feb. 25, 1971. p. 23. 27. " C o n t a i n e r Labor Problems Appraised by Union, C a r r i e r , and S h i p p e r E x e c u t i v e s " , T r a f f i c Management and D i s t r i b u t i o n , June 1970. pp. 22-23. 28. Some of the d i s r u p t i o n s t h a t have occured were the r e s u l t of i n t e r - u n i o n r i v a l a r y . In the f a l l of 1969 the Teamsters o b j e c t e d to the l o s s of work i n s t u f f i n g and d e s t u f f i n g c o n t a i n -e r s a t the t r u c k company CFS l o c a t e d near the docks i n San F r a n s c i s c o . The d i s p u t e f i n a l l y had to be r e s o l v e d i n Court. See "Teamsters, P i e r Union R i f t i n San F r a n s c i s c o Goes to Court Today", Wall S t r e e t J o u r n a l , Sept. 15, 1969. p. 6. 30. H. Br i d g e s , Speech to the ILWU Caucus, Caucus Proceed-i n g s , March 1956. pp. 202-203. 31. C o n t a i n e r i z a t i o n : Yearbook, op. c i t . , p. 31. 32. i b i d . 33« G. Payne, K. Cox, P e r s o n a l Interviews. 34. See. the Deschenes, P i c a r d , and A.I. Smith Labour I n q u i r y Reports. Relevant p o r t i o n s are quoted i n the Smith  Report, op. c i t . , pp. l65-195« 35» " P o r t s - Mackasey on P r o d u c t i v i t y " , Canadian S h i p p i n g  and Marine E n g i n e e r i n g , Sept. 1970. p. 28. 36. Smith, op_. c i t . ; 37. "Summary by Dr. P i c a r d of P r i n c i p a l C o n c l u s i o n s o f I n q u i r y i n t o S t . Lawrence P o r t s " , Canada Department o f lab o u r . Queens P r i n t e r , Ottawa. 196?. 38. Smith, op. c i t . 39. This d i s c u s s i o n i s based "Waterfront S t r i k e S e t t l e m e n t Hurt by Fear", an a r t i c l e by E.M. Strang, P r e s i d e n t o f the B.C. Maritime Employers A s s o c i a t i o n , i n Western Business and I n d u s t r y : J o u r n a l o f Commerce (Vancouver), A p r i l 13, 1970; and on G. Payne, and P. S e n i o r , P e r s o n a l I n t e r v i e w s . 40. S t r a n g , op. c i t . , p. 13A. 41. ILWU members c l a i m t h a t there has been a ' b i g change' i n the Union member's a t t i t u d e s s i n c e the summer of 1970 - a l l f o r the worse - as f r u s t r a t i o n s w i t h t h e i r f e l l o w union members, f e l l o w gang workers, foremen, and management, i n c r e a s e s t e a d i l y . ILWU members, P e r s o n a l I n t e r v i e w s . 42. "The Co n t a i n e r Way", A d v e r t i z i n g l i t e r a t u r e , Empire S t e v e d o r i n g Co., Vancouver. A p r i l 1971. c f . Tables 3.19j 3.20. 43. G. Payne, P e r s o n a l Interview. 44. G. Payne, Speech to the I n s t i t u t e of Naval A r c h i t e c t s  and Marine E n g i n e e r s , A p r i l 23, 1971. 45. While the average t o t a l working time i s l e s s than 48 hours, and u s u a l l y l e s s than J6 hours, the Japan 6 s h i p s are o f t e n i n P o r t f o r approximately 72 hours. 46. G. Payne, P e r s o n a l Interview. 48. i b i d . 49. K. Cox, P e r s o n a l Interview. 50. i b i d . 51. i b i d . 52. During the F a l l of 1969 the s a i l i n g of the world's f i r s t LASH v e s s e l , the Acadia F o r r e s t , was delayed f o r weeks a t New Orleans, u n t i l l the op e r a t o r agreed t o : a. use more longshoremen than needed, and b. pay a p e n a l t y f o r i n l a n d loaded barge cargo. c f . In U.S. West Coast p o r t s , 4l v e s s e l s were s t r u c k u n t i l Watson compromised i t s p l a n to c u t sh i p b o a r d crews on new c o n t a i n e r s h i p s . c f . In New York, the f r i n g e b e n e f i t s have been i n c r e a s e d from $1.50/man hour to $2.07/ton of cargo handled, a move t h a t can o n l y p e n a l i z e c o n t a i n e r cargo. A. Van Cranebrock, "Labor Demands Portend Turbulent T r a n s p o r t E r a " , T r a f f i c Management and P h y s i c a l D i s t r i b u t i o n , March, 1970. pp. 68-74. 53. Payne, op. c i t . , Speech to the I n s t i t u t e of Naval  A r c h i t e c t s and Marine E n g i n e e r s , 1971. p. 11. 54. McDonald, op_. c i t . OTHER FACTORS WHICH TEND TO PREVENT INTERMODAL TRANSFER  OF CONTAINERIZED CARGO The l a s t two Chapters have dwelt a t l e n g t h on the two major f a c t o r s which are p r e v e n t i n g i n t e r m o d a l c o n t a i n e r movement through Vancouver. T h i s s e c t i o n b r i e f l y mentions a number of o t h e r f a c t o r s , which, w h i l e perhaps not a c t u a l l y p r e v e n t i n g the movement of i n t a c t c o n t a i n e r s , p r o b a b l y do not encourage such movement. More study would be n e c e s s a r y to determine the importance of each i n the P o r t o f Vancouver. S p e c i f i c areas r e f e r r e d to are the problems encountered i n documentation and customs, the l e g a l c o n s t r a i n t s a s s o c i a t e d w i t h c o n t a i n e r i z e d cargo, and the r e l u c t a n c e o f everyone (except the steamship l i n e s ) to embrace c o n t a i n e r i z a t i o n as the 'only way' to move cargo. I n t h i s c o n n e c t i o n must be mentioned, even emphasized, the d i v e r s i t y o f views, and i n some cases c o n f l i c t i n g o p i n i o n s , o f those a c t i v e l y engaged i n c o n t a i n e r movement i n Vancouver. Cf a l l these, perhaps the g r e a t e s t d e t e r r e n t to a completely i n t e r m o d a l system i s the deeply i n g r a i n e d b e l i e f by many co r p o r a t e and i n d i v i d u a l p a r t i e s a s s o c i a t e d w i t h the movement of c o n t a i n e r s , t h a t t h i s 'new d e v i c e ' o r new approach to m a t e r i a l s h a n d l i n g i s not r e a l l y permanent. They q u e s t i o n the wisdom of spending m i l l i o n s on an o p e r a t i o n which may be 1 CUSTOMS The customs problems encountered i n intermodal container movement of cargo have usually been f a i r l y minor. The matter of convenience usually i s the deciding point, i f the matter 2 does a r i s e . The major instrument of import control, The Canadian Customs Act, applied through implementation of the regulations of the Customs T a r i f f has the following purposes: (1) revenue producer (customs and excise d u t i e s ) , (2) l e g a l b a r r i e r against foreign competition (including dumping), (3) lever to secure trade agreements more favorable to Canada, 3 (4) method of promoting Canadian i n d u s t r i a l development. The regulations specify that " a l l imported goods, whether destined to a port of entry i n Canada, or to any place i n Canada, or f o r transportation i n t r a n s i t through Canada, s h a l l be described on a manifest executed by a bonded c a r r i e r . This manifest must give f u l l d e t a i l s of the shipment as described on the b i l l of lading". 4 This i s because a l l imported goods are subject to an ad valorem and/or specify duty, unless s p e c i f i c a l l y exempt. Customs clearance " s h a l l be...at a port of entry where a Customs-House 5 i s l a w f u l l y established". The containers themselves encounter no customs inspection problems, so long as they are 're-exported' within six months of t h e i r 'importation' date. Most customs inspection, because of the volume of t r a f f i c , i s more an examination of documents, than an examination of contents. Normal procedure would be f o r the customs o f f i c e r to check the contents of one or a few cartons, and a f t e r v e r i f y i n g that i t checks with the packing l i s t , he clears the enti r e shipment without p h y s i c a l l y examining each carton, nor checking the count. Provisions e x i s t f o r a more extensive check, i f i t i s deemed to be warranted. Customs inspection of cargo can occur at any of a v a r i e t y of l o c a t i o n s , depending on the method, mode, and timing of importation. For containers discharged at the Vancouver waterfront and moving to the CFS or other f r e i g h t shed, inspection would normally occur at the waterfront as the container i s destuffed. Should the same container have been moved to the CY and loaded aboard a r a i l car f o r shipment east, customs inspections could occur at the railhead, at the team tracks, or at the consignee's premises. However i f that container should be f o r re-export to the U.S. or to Europe, customs inspection would be l i m i t e d to ensuring that the i n t a c t container so moved. I f the same goods i n the same container had been discharged i n S e a t t l e f o r transfer to Vancouver f o r movement east, the customs procedure would be b a s i c a l l y the same, although the regulatory d e t a i l s would d i f f e r . I f f o r example, that container of goods had been discharged into the CY at the Port of Seattle, placed on a chassis and moved to the Burlington Northern r a i l yards i n that c i t y , loaded on an 89-foot f l a t c a r and transported to the B.N. terminal i n Vancouver, the following procedure would Vancouver on an Import T r a n s i t and E x p o r t a t i o n Order, I n Vancouver, customs c l e a r a n c e would occur a t the p o i n t of c o n t a i n e r d e s t u f f i n g , which c o u l d be a t the SeaCon S e r v i c e s 6 warehouse, or as i n the case of Western Assembly cargo, a t the f r e i g h t forwarder's premises. However i f t h a t c o n t a i n e r had been moved from S e a t t l e to Vancouver 'over the road' on a U.S. Import T r a n s i t and E x p o r t a t i o n Order, customs i n s p e c t i o n c o u l d have o c c u r r e d a t the f r e i g h t c o n s o l i d a t o r ' s warehouse, the consignee's premises, or (on r a r e o c c a s i o n s ) a t the Canadian border. Should a S e a t t l e d i s c h a r g e d c o n t a i n e r , moved to Vancouver by e i t h e r road o r r a i l , be d e s t i n e d f o r an i n t a c t movement eastward, i n s p e c t i o n c o u l d occur a t the r a i l head, a t the team t r a c k s , or a t the consignee's own premises. DOCUMENTATION A s e r i o u s l o s s o f cargo f o r w a r d i n g time o f t e n r e s u l t s from dela y e d o r improper documentation. Without the B i l l o f L a d i n g i n p r o p e r o r d e r the c o n t a i n e r of goods can n e i t h e r be forwarded, i n s p e c t e d nor d e s t u f f e d . S i n c e the c o n t a i n e r s h i p ' s m a n i f e s t i s completed a f t e r the v e s s e l l e a v e s the p o r t , i t must be forwarded by a i r m a i l . I n the case o f the Japan-West Coast t r a f f i c , the c o n t a i n e r v e s s e l s r e q u i r e o n l y seven days to c r o s s the P a c i f i c . I f the documents are de l a y e d f o r two or th r e e days a f t e r the v e s s e l l e a v e s Japan i t may w e l l happen t h a t the s h i p stowage p l a n a r r i v e s i n S e a t t l e o n l y the day b e f o r e the v e s s e l . Vancouver i s f o r t u n a t e to be the second p o r t of c a l l as t h i s p r o v i d e s one or two a d d i t i o n a l days to prepare f o r the incoming v e s s e l . The r e v e r s e s i t u a t i o n occurs on the r e t u r n journey as Vancouver may be the l a s t p o r t of d e p a r t u r e . To cope w i t h the tremendous documentation l o a d t h a t a r i s e s with i n c r e a s e d volumes of c o n t a i n e r s moving, most European and E a s t e r n North American p o r t a u t h o r i t i e s have been f o r c e d to computerize. In some cases they have i n s t a l l e d computerized systems b e f o r e the needs of e i t h e r the p o r t or the document has been determined. Immer s t a t e s t h a t "documentation should be p r e p a r e d a t o r i g i n and s h o u l d serve a l l purposes f o r the 7 e n t i r e t r i p " . A t the p r e s e n t time t h i s does not happen. 8 I n 1 9 6 8 , the EASAMS Report^ was prepared f o r the N a t i o n a l P o r t s C o u n c i l o f Great B r i t a i n on ways to s i m p l i f y and speed up documentation. T h i s Report documented the tremendous amount of •paperwork* a s s o c i a t e d with cargo movements, and the l a r g e number o f p a r t i e s who r e q u i r e some or a l l of the same i n f o r m a t i o n . ;.In August o f t h a t year, the SITPRO Committee was e s t a b l i s h e d "to study documentation i n i n t e r n a t i o n a l trade...and the commercial and governmental procedures a s s o c i a t e d with i t . . . i n the l i g h t of the widening use of computers and data l i n k s , and to make recommendations to a s s i s t the more e f f i c i e n t f l o w of t r a d e . " 9 A number of s i m i l a r committees are a l s o o p e r a t i o n a l i n A u s t r a l i a , Canada, Hong Kong, and the U n i t e d S t a t e s . The SITPRO Report c o n t a i n e d J2 major recommendations f o r c o n s i d e r a t i o n and a c t i o n by as d i v e r s e ^ a group as the S h i p p e r s C o u n c i l , B r i t i s h R a i l , the S m a l l e r B u s i n e s s A s s o c i a t i o n , L l o y d s , and H.M T r e a s u r y , as w e l l as SITPRO, the P o r t A u t h o r i t i e s , and the N a t i o n a l P o r t C o u n c i l , caused s e r i o u s d e l a y s a t Vancouver Harbor f a c i l i t i e s . I f c o n t a i n e r use through the P o r t of Vancouver c o n t i n u e s to i n c r e a s e a t i t s p r e s e n t pace, i n s t a n c e s of ' l o s t ' c o n t a i n e r s , 'misplaced* c a p e r s , d e l a y e d shipments, and f r u s t r a t e d s h i p p e r s , 10 c a r r i e r s and consignees a r e i n e v i t a b l e , u n l e s s e f f i c i e n t documentation procedures, perhaps i n v o l v i n g a computer are i n s t a l l e d . No d i s c u s s i o n of c a r r i e r l i a b i l i t i e s o r i n s u r a n c e problems w i l l be attempted i n t h i s study. I t must be r e c o g n i z e d however t h a t these are i n t r i c a t e l y i n v o l v e d with proper documentation and e f f i c i e n t customs procedures. Also, r e c e n t c o u r t d e c i s i o n s have e s t a b l i s h e d t h a t The Hague Rules l i m i t i n g l i a b i l i t y to $500 per package does not mean $500.00 per c o n t a i n e r , but $500.00 f o r each c a r t o n i n the c o n t a i n e r . SORTATION PROCEDURES One of the most time and l a b o r consuming p r a c t i c e s encountered wi t h import cargo i s the matter of goods not b e i n g d i s c h a r g e d on the dock by B i l l o f Lading. T h i s 'dumping' i s not t o l e r a t e d a t the P o r t of S e a t t l e . However there are no 12 e f f e c t i v e r e g u l a t i o n s to prevent i t i n Vancouver. T h i s i s not a major problem with ' c o n t a i n e r i z e d * goods as these u n i t s are moved away from the dock f o r d e s t u f f i n g . However with any CFS d e s t i n e d c o n t a i n e r shipments, time i s wasted when s e v e r a l shipments from s e v e r a l s h i p p e r s f o r d i f f e r e n t consignees i n d i f f e r e n t c i t i e s a re packed i n a s i n g l e c o n t a i n e r . T h i s may-w e l l be a r e f l e c t i o n o f s m a l l o r d e r s i z e , but i t a l s o seems t h a t a b e t t e r s t u f f i n g p l a n c o u l d be f o l l o w e d , i n t h a t a t l e a s t the goods i n a s i n g l e c o n t a i n e r should a l l be d e s t i n e d to the same c i t y , o r a t the v e r y minimum, to the same a r e a . P a r t i c u l a r l y s i n c e no s e r i o u s longshore union problems have been r e p o r t e d from Japan, and i n l i g h t o f the f a c t t h a t s i g n i f i c a n t q u a n t i t i e s of cargo has been t r a n s h i p p e d from o t h e r p o r t s , i t sh o u l d be a r e l a t i v e l y simple matter to s t u f f c o n t a i n e r s with cargo f o r o n l y one d e s t i n a t i o n c i t y . I f t h i s were done, l e s s cargo s h o u l d have to be d e s t u f f e d on the Vancouver w a t e r f r o n t , and in t e r m o d a l cargo movement would r e s u l t . Should a b e t t e r stowage p l a n c o i n c i d e w i t h the i n t r o d u c t i o n of a t t r a c t i v e r a i l and/or road r a t e s f o r c o n t a i n e r movement, ve r y s i g n i f i c a n t s a v i n g s o f time, and (perhaps) of t r a n s p o r t a t i o n c o s t s c o u l d be ex p e r i e n c e d by many more consignees. To c a r r y t h i s procedure to i t s u l t i m a t e d e s i r e d end, the ILWU would have a l s o to 'accept' the c o n t a i n e r , and t r u s t t h a t the advantages o f t h i s cargo t r a n s f e r method would generate s u f f i c i e n t l y l a r g e r t r a f f i c volumes through the P o r t of Vancouver t h a t t h e i r work would a c t u a l l y i n c r e a s e . I f th'ey do n o t r e a d j u s t t h e i r t h i n k i n g , the union c o u l d f i n d i t s e l f i n a p o s i t i o n v e r y s i m i l a r to t h a t o f the T i l b u r y dock workers and the ILA i n Montreal with lowered p r o d u c t i v i t y c a u s i n g cargo to 13 be t r a n s f e r r e d to a competing p o r t f o r d i s c h a r g e . Vancouver longshoremen may not be f o r t u n a t e enough to r e g a i n t h i s l o s t t r a d e e i t h e r ! The net r e s u l t would be even l e s s work on the docks of Vancouver. One way that the longshoremen could ensure that the present ILWU members do not s u f f e r would be to 'professionalize' t h e i r union and place l i m i t s on who can gain admittance to work on the docks. OTHER FACTORS Several other factors enter the picture when considering the intermodal movement of containers, including the following! (1) The railways do not quote piggyback rates f o r containers (with the exception of ocean-carrier owned chassis under T a r i f f CFA-263). therefore while they are w i l l i n g to carry the truck t r a i l e r s piggyback, they i n s i s t that the containers move over the road or on r a i l f l a t c a r s . (Neither i s competitive with the pool-car or truck rate.) The r e s u l t i s that cargo f o r OCP destinations does not move piggyback i n containers. (2) The container i t s e l f must return to the port of entry within s i x months of i t s 'importation' i n order to remain duty f r e e . While t h i s requirement has not been any problem per se, the domestic use of these 'import-ed' containers by the importer or c a r r i e r i s l i m i t e d to one stop. In addition, containers have not moved east because back-haul t r a f f i c has not been a v a i l a b l e . The 'price' f o r returning empty containers to Vancouver from Toronto i s $100.00 each, minimum of 2 containers per shipment. The consignee must pay t h i s back-haul charge. (3) Many consignees are importing containerized cargo from the Orient on speculation ( j u s t as they have always done with break-bulk cargo) and s e l l i n g the goods while i n ocean t r a n s i t , Vancouver waterfront storage, f r e i g h t forwarder storage, or while i n the hands of the inland c a r r i e r . In t h i s way the importer i s able to r e a l i z e the advantages of containerization u n t i l discharge at Vancouver} at the same time he can u t i l i z e the f l e x i b i l i t y provided i n being able to break the shipment f o r multi-point d i s t r i b u t i o n from Vancouver. The portion of the shipment moving to OCP destinations i s separated out and forwarded, usually by poolcar, d i r e c t l y to Toronto (or Oshawa, or Montreal, or Quebec City) without f i r s t being moved to a Toronto warehouse. The r e s t of the shipment, scheduled f o r Local d e l i v e r y points, can also be forwarded d i r e c t l y . On t h i s l a t e r portion, an upward adjustment on the ocean t r a n s i t rate i s made to the l e v e l applicable f o r the Local destinations involved. In the end, however the major reasons why OCP destination t r a f f i c has not moved east from Vancouver i n i n t a c t containers i s s t i l l the unattractive r a i l rates, the union demands, and the inland c a r r i e r s reluctance to commit themselves to containers i n the manner of the steamship l i n e s . CHAPTER VI 1. This d i s c u s s i o n i s based on a telephone c o n v e r s a t i o n w i t h a Customs O f f i c e r , P o r t of Vancouver Customs O f f i c e ; and D. McGregor, P e r s o n a l Interview. 2. K. Cox, P e r s o n a l Interview. 3. " C e r t i f i c a t e Course", Canadian I n s t i t u t e - o f T r a f f i c and  T r a n s p o r t a t i o n , Toronto. 1964. p. 19:1 4. i b i d . 5. i b i d . 6. K. Cox, P e r s o n a l Interview. 7. J.R. Immer, Co n t a i n e r S e r v i c e s on the A t l a n t i c 1970. Work Savi n g I n t e r n a t i o n a l , Washington, D.C. 1970. p. 13» 8. "Cargo Movements i n the 1970's", Report to the N a t i o n a l P o r t s C o u n c i l of Great B r i t a i n by E - A Space and Advanced M i l i t a r y Systems, L t d . , March 1968, C i t e d i n Immer, i b i d , p. 13. 9. "The S i t p r o Report 1970", Report by the United Kingdom Committee f o r the S i m p l i f i c a t i o n of I n t e r n a t i o n a l Trade Proced-ures of the N a t i o n a l Economic Development C o u n c i l . London. Her Majesty's S t a t i o n a r y O f f i c e . 1970. p. 1. 10. One example which occured i n Vancouver was the l e a s i n g o f a number of c o n t a i n e r s to one s h i p p e r , and the l e a s i n g of the same c o n t a i n e r s to another s h i p p e r the f o l l o w i n g day, simply because the bookwork had been allowed to ' f a l l behind'. G. Payne, P e r s o n a l Interview. 11. A weekly f e a t u r e i s p r e s e n t e d i n F a i r p l a y d e a l i n g v/ith Insurance and the Legal L i a b i l i t i e s of C a r r i e r s which documents and d e s c r i b e s r e c e n t Maritime c o u r t d e c i s i o n s i n d i f f e r e n t c o u n t r i e s . A number of the columns i n 1970 d e a l t s p e c i f i c a l l y w i t h the c a r r i a g e of c o n t a i n e r i z e d goods. These were summarized i n F a i r p l a y , Jan. 7, 1971. pp. 87-93. 12. G. Payne, P e r s o n a l Interview. 13* C u r r e n t l y SeaLand i s moving 2000 c o n t a i n e r l o a d s of cargo per month i n t o the P o r t of S e a t t l e which had f o r m e r l y a l l moved through the P o r t of Vancouver. K. Cox, P e r s o n a l Interview. CONCLUSIONS AND SUMMARY T h i s study has attempted to document the development of f r e i g h t movement from 'OCP o r i g i n ' n a t i o n s through the P o r t of Vancouver to Overland Common P o i n t T e r r i t o r y . The h i s t o r y of OCP t r a f f i c has been documented and an a n a l y s i s of the commodities and tonnages i n v o l v e d has been undertaken. I t has been shown t h a t s i g n i f i c a n t tonnages of cargo, the g r e a t m a j o r i t y of which are c o n t a i n e r i z a b l e , are c u r r e n t l y b e i n g imported through both B r i t i s h Columbia and A t l a n t i c Coast p o r t s from A u s t r a l i a , New Zealand, Japan, Hong Kong, Taiwan, and o t h e r A s i a n c o u n t r i e s . Canada's import t r a d e has i n c r e a s e d r a p i d l y i n the p a s t few y e a r s , but the P o r t of Vancouver does not appear to have shared i n t h i s growth p r o p o r t i o n a l l y . There has a l s o been a r a p i d world-wide c o n v e r s i o n to c o n t a i n e r i z a t i o n , by both s h i p p i n g l i n e s and p o r t s , but the i n l a n d c a r r i e r s i n Western Canada have not j o i n e d i n the move to i n t e r m o d a l c o n t a i n e r i z a t i o n . As a r e s u l t , i n l a n d OCP t r a f f i c has c o n t i n u e d to be moved i n boxcars, i n s p i t e o f the c o n t a i n e r i z a t i o n of the P a c i f i c t r a d e s . T h i s study has attempted to determine why the c o n t a i n e r i s not moving i n l a n d from the P o r t of Vancouver. The t h e o r e t i c a l i d e a l would be f o r complete door-to-door t r a n s p o r t a t i o n o f cargo i n a s e a l e d c o n t a i n e r on one B i l l of Lad i n g , r e g a r d l e s s o f the number o r type o f t r a n s p o r t modes and nodes i n v o l v e d . The p o t e n t i a l f o r t h i s s i t u a t i o n e x i s t s w i t h OCP t r a f f i c through the p o r t s o f B.C., but l e s s than 25$ of a l l c o n t a i n e r shipments and l e s s than 10$ o f the OCP c o n t a i n e r i z e d cargo u t i l i z e s the concept. One of the b i g g e s t drawbacks appears to be the f e e l i n g , among both c a r r i e r s and s h i p p e r s , t h a t the van c o n t a i n e r i s o n l y a d i f f e r e n t means of ocean t r a n s p o r t a t i o n ; they, i n g e n e r a l , have f a i l e d to grasp the concept t h a t "the c o n t a i n e r r e v o l u t i o n can be seen as a 1.'.;.-r e v o l u t i o n i n packing , as much as i n t r a n s p o r t " . Because of t h i s a t t i t u d e , many of the 'wonderful s a v i n g s ' expected to r e s u l t from c o n t a i n e r i z a t i o n , have f a i l e d to m a t e r i a l i z e . The f o r m a l i n a u g u r a t i o n o f c o n t a i n e r h a n d l i n g f a c i l i t i e s on the Vancouver w a t e r f r o n t i n June of 1970 r e s u l t e d i n a marked i n c r e a s e i n the volume o f c o n t a i n e r i z e d cargo from OCP o r i g i n a t i n g r e g i o n s , p r i n c i p a l l y Japan, Taiwan, and Korea. T h i s was the d i r e c t r e s u l t o f the s h i f t to f u l l y c o n t a i n e r i z e d v e s s e l s by the members of the Japan 6 L i n e , However 85$ of the c o n t a i n e r s a r r i v i n g a t the P o r t o f Vancouver are b e i n g d e s t u f f e d i n the CFS by longshore l a b o r , and loaded i n t o r a i l w a y c a r s or t r u c k s f o r fo r w a r d i n g . T h i s procedure e f f e c t i v e l y e l i m i n a t e s the m a j o r i t y o f the p o t e n t i a l b e n e f i t s from c o n t a i n e r i z a t i o n , and i t d e s t r o y s the i n t e r m o d a l concept of cargo t r a n s f e r . An analysis of the composition of OCP cargo indicates that the type of goods being imported has not changed with the introduction of the van container. This trade i s s t i l l composed of general consumer goods, s p e c i a l t y food items, processed foods, and s t e e l products and the concensus of opinion i s that 75$ of t h i s t r a f f i c i s suitable to container-i z a t i o n . In f a c t much of i t i s i d e a l l y suited to transfer i n a container. I f a continuation of the current volume of OCP t r a f f i c through the Port of Vancouver, and a growth i n the tonnage of door-to-door containerized OCP t r a f f i c i n p a r t i c u l a r , i s to occur, the following minimum conditions would appear necessary, (A t r a f f i c increase would r e s u l t only i f these conditions are more than met) OCEAN RATES 1. The present ocean rates on cargo off-loaded in.Vancouver plus the inland movement charges must be competitive with the l a i d -down pr i c e v i a the Panama Canal and the St, John-Toronto r a i l movement. 2. The Japanese Lines commence f u l l container ship service to the New York and Halifax ports i n 1972. I f the laid-down pr i c e i n Toronto or Montreal i s les s than v i a Vancouver, the importing firms w i l l very q u i c k l y switch from the Port of Vancouver. 1. The present absorption practices ( f o r wharfage, handling, and loading charges) by the steamship and r a i l r o a d companies must be continued, and should be extended to cover any inland Canadian c a r r i e r ( i . e . the truckers). 2. The terminal absorption practices should be extended to cover i n t a c t containers moving through the Vancouver CY, 3 . Terminal charges and rules should become competitive with those l e v i e d by the Port of Seattle, both i n d o l l a r s per ton of cargo, and i n structure ( i . e , a single a l l - i n c l u s i v e fee to the account of the cargo), INLAND CARRIER RATES 1. The present rate structure f o r the movement of i n t a c t containers must become more competitive,(on the basis of $/cwt of cargo moved,) with the cost of poolcar shipments. 2. A re l a x a t i o n of the regulations governing return of the empty container at the consignee's expense, to allow the inland c a r r i e r to s o l i c i t e i t h e r domestic or foreign f r e i g h t f o r the back-haul to Vancouver would be advantageous. 3 . Competitive rates f o r the volume movement of i n t a c t containers, not nece s s a r i l y i n a unit t r a i n , should be established now i n an e f f o r t to develop i n t a c t r a i l movement of containers i n volume, rather than waiting u n t i l the t r a f f i c " j u s t i f i e s ' a volume rate. 1. I t appears both possible, and necessary, f o r the persons s t u f f i n g the containers i n 'OCP o r i g i n ' countries to use a more r a t i o n a l s o r t a t i o n procedure. This might involve more planning by supervisory s t a f f , but i t seems t o t a l l y i l l o g i c a l to place bamboo fur n i t u r e f o r Calgary, musical instruments f o r Winnipeg, and footware f o r Toronto i n the same container, p a r t i c u l a r l y i f the destinations are known at the time of packing. WATERFRONT LABOR 1. Future Vancouver waterfront contracts must not allow interference with the forwarding of OCP cargo. I f t h i s means moving the sealed container out of the CY to a Vancouver f r e i g h t consolidator's premises f o r destuffing and loading into a truck or r a i l car, then i t should be done. 2. Vancouver waterfront management must 'unite' and act as one body i n order to regain e f f e c t i v e control of the waterfront from the Union. (This involves a v i s i b l e , and e f f e c t i v e , N.H.B. administration.) 3. A freeze should be placed on the ILWU membership r o l l , i n order that present members can receive a guarantee of hours of work per year. Simultaneously, t h e Union should recognize the benefits of decasualization of the waterfront to both t h e i r members and to the employers. 4. Management must be prepared to ( l i t e r a l l y ) share the benefits of containerization with the Union members, but the membership must be equally prepared to share the benefits with management. 5. Should the Seattle dock workers gain a containerization clause s i m i l a r to that of the Vancouver agreement,some increase i n Port of Vancouver container discharges may develop, which would lessen union pressure f o r the de s t u f f i n g of OCP-bound cargo on the waterfront i n Vancouver. The d e n s i t y (weight/volume) c h a r a c t e r i s t i c s of t h i s t r a f f i c combined with p r e s e n t t a r i f f schedules of the i n l a n d c a r r i e r s p r e v e n t the eastward movement of the i n t a c t 'OCP' c o n t a i n e r . The c u r r e n t ILWU c o n t r a c t m i t i g a t e s a g a i n s t the movement of c o n t a i n e r s from the w a t e r f r o n t , but even without the '50-mile c l a u s e ' i n the ILWU c o n t r a c t , d e s t u f f i n g would continue to occur i n Vancouver. The d i f f e r e n c e would be t h a t the f r e i g h t f o rwarders and t r u c k i n g companies would be s u p p l y i n g t h i s s e r v i c e . T h i s means t h a t the cargo would be handled two to f o u r fewer times, w h i l e the movement of the i n t a c t c o n t a i n e r c o u l d e l i m i n a t e another f o u r h a n d l i n g s . Unless the ocean and/or i n l a n d c a r r i e r s a l t e r the p r e f e r -e n t i a l r a t e s on OCP-bound cargo, or l a b o r charges f o r d e s t u f f i n g become more expensive than a t the p r e s e n t time, t h i s cargo w i l l p r o b a b l y c o n t i n u e to a r r i v e a t the CFS i n Vancouver i n c o n t a i n e r s , be d e s t u f f e d , and p l a c e d i n r a i l c a r s o r t r u c k s f o r f o r w a r d i n g to OCP d e s t i n a t i o n s . A l t e r n a t i v e l y , the c o n t a i n e r i z e d cargo w i l l be d e l i v e r e d to the CY i n S e a t t l e and be t r a n s f e r r e d by road o r r a i l to the premises of f r e i g h t f o rwarders and c o n s o l i d a t o r s i n Vancouver f o r d e s t u f f i n g . However i t would s t i l l be p l a c e d i n t r u c k s o r boxcars f o r shipment to i t s OCP d e s t i n a t i o n . T h i s procedure does not u t i l i z e the advantages of the in t e r m o d a l c o n t a i n e r concept, but the p r i c e f a c t o r s appear s u f f i c i e n t l y important t h a t OCP t r a f f i c through the P o r t of Vancouver w i l l m a i n t a i n i t s non-intermodal c h a r a c t e r i s t i c s . CHAPTER VII 1. S.G. Sturmey, "The Impact of World Seaborne Trade on Changes i n S h i p p i n g C o s t s " , L e c t u r e d e l i v e r e d to The  I n t e r n a t i o n a l Symposium on Middleterm and Longterm F o r e c a s t i n g  f o r S h i p b u i l d i n g and S h i p p i n g , S t i c h t i n g Maritieme Research, The Hague, June 16-18, 1970. pp. 35-55. BOOKS Bennathan, E s r a , and A.A. Walters. The Economics of Ocean F r e i g h t Rates. F r e d e r i c k A. Praeger, Inc., New York. 1969. 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Prepared by Matson Research C o r p o r a t i o n , San F r a n s c i s c o , C a l i f o r n i a . J u l y 1 9 7 0 . S h e r i f f , W.J. "The P o r t o f Vancouver General Cargo Requirements", Report f o r the N a t i o n a l Harbour's Board. Prepared by the B r i t i s h Columbia Research C o u n c i l , Vancouver, B.C. January 1 9 6 8 . "The SITPRO Report 197°"» Report by the United Kingdom Committee f o r the S i m p l i f i c a t i o n of I n t e r n a t i o n a l Trade Procedures of the N a t i o n a l Economic Development C o u n c i l , London. H.M.S.O. 1 9 7 0 . Smith, A r t h u r I. "Report of I n q u i r y Into C e r t a i n C o n d i t i o n s , Conduct, and Matters G i v i n g Rise to Labour Unrest a t the Po r t s of Montreal, T r o i s - R i v i e r e s , and Quebec, P.Q.", Canada Department o f Labour, Queens P r i n t e r , Ottawa. 1 9 6 9 . Tanner, M.F., and A.F. W i l l i a m s . " P o r t Development and N a t i o n a l S t r a t e g y " , J . Transport Economics and P o l i c y , London School of Economics, London. V o l . 1 No. 3. September 1 9 6 7 . "Transhipment i n the S e v e n t i e s : A Study o f Co n t a i n e r Transport", Report to N a t i o n a l P o r t s C o u n c i l (U.K.). Prepared by Ar t h u r D. L i t t l e , L t d . , London. 1 9 7 0 . "The Turnaround Time o f Ships i n P o r t " , P u b l i c a t i o n No. ST/ECA/97, S a l e s No.: 6 7 . V I I I . 5 . United Nations, New York. 1 9 6 7 . B r i t i s h Columbia Business J o u r n a l . Cambridge P u b l i s h e r s (Canada) Ltd., Portage Avenue, Winnipeg, Manitoba. Business Week. McGraw-Hill, Inc., West 42nd S t r e e t , New York, N.Y. Canadian Business. C B Media L i m i t e d , Beaver H a l l H i l l , M o n t r e a l , Quebec. Canadian S h i p p i n g and Marine E n g i n e e r i n g . Maclean-Hunter L i m i t e d , U n i v e r s i t y Avenue, Toronto, O n t a r i o . Canadian T r a n s p o r t a t i o n and D i s t r i b u t i o n Management. Southam Business P u b l i c a t i o n s L i m i t e d , 1450 Don M i l l s Road, Don M i l l s , O n t a r i o . D i s t r i b u t i o n Worldwide. C h i l t o n Company, One Decker Square. Bala-Cynwyd, Pa...U.S.A. Far E a s t Trade and Development. Laurence French P u b l i c a t i o n s L t d . , 3 B e l s i z e Cres., London, NW3 5QZ, U.K. The Economist. The Economist Newspaper L t d . , The Economist B u i l d i n g , 25 S t . James's S t r e e t , London, SW1, U.K. F a i r p l a y I n t e r n a t i o n a l S h i p p i n g J o u r n a l . F a i r p l a y P u b l i c a t i o n s L i m i t e d , 1, Pudding Lane, London, U.K. Harbour and S h i p p i n g . , Progress P u b l i s h i n g Co., (1958) L t d . , Vancouver, B.C. Marine En g i n e e r i n g / L o g . Simmons Boardman P u b l i s h i n g C o r p o r a t i o n , 508 B i r c h St. , B r i s t o l , Conn. New S c i e n t i s t . New Science P u b l i c a t i o n s , 128 Long Acre, London, WC2E 9QH London, U.K. P o r t of Sydney. The Maritime S e r v i c e s Board of N.S.W., Box 32 , G.P.O., Sydney, A u s t r a l i a . P u r c h a s i n g i n Western Canada. Gordon Black P u b l i c a t i o n s L t d . , Vancouver, B.C. S h i p p i n g World and S h i p b u i l d e r . A Berm Group J o u r n a l , Lyon Tower, 125 High S t r e e t , C o l l i e r s Wood, London, SW19 U.K. T r a f f i c Management and P h y s i c a l D i s t r i b u t i o n . Conover-Mast P u b l i c a t i o n s , D i v i s i o n of Cahners P u b l i s h i n g Co., Inc., 205 E 42nd S t . , New York, N.Y. S e r v i c e C o r p o r a t i o n , 815 Washington B u i l d i n g , Washington, D.C. The Westsider. West Side Assoc. o f Commerce Inc., 330 W 42nd S t . , New York, N.Y. NEWSPAPERS J o u r n a l o f Commerce. (New York) Twin Coast Newspapers, Inc., 99 Wall S t . , New York, N.Y. The P r o v i n c e . (Vancouver) P a c i f i c P r e s s L i m i t e d , 2250 G r a n v i l l e S t . , Vancouver, B.C. The S t a r - B u l l e t i n . (Honolulu) Honolulu S t a r - B u l l e t i n , Inc., News Bldg., 605 K a p i o l a n i B l v d . , Honolulu, Hawaii, U.S.A. The Toronto Globe and M a i l . The Globe and M a i l L i m i t e d , 140 King St. W., Toronto, O n t a r i o . Todds S h i p y a r d News. (New York) Todds Shipyards C o r p o r a t i o n , New York, N.Y. The Wall S t r e e t J o u r n a l . Dow Jones & Company, Inc. , 30 Broad S t r e e t , New York, N.Y. Western Business and In d u s t r y ; J o u r n a l of Commerce. (Vancouver) J o u r n a l of Commerce L i m i t e d , West 12th Avenue, Vancouver, B.C. UNPUBLISHED MATERIALS Brid g e s , Harry. Speech to the ILWU Caucus, Caucus Proceedings, March 1956. " C o n t a i n e r i z a t i o n i n the S e v e n t i e s " , Proceedings of the Canadian T r a n s p o r t a t i o n Research Forum, P a n e l D i s c u s s i o n , Vancouver, B.C. March 20, 1970. Dame, R.L. " T e c h n i c a l Aspects of C o n t a i n e r i z a t i o n " , Paper p r e s e n t e d to Kawasaki K i s e n Kaisha, L t d . , ("K" L i n e ) , by Robert L. Dame and A s s o c i a t e s , Group C o n s u l t a n t , S e a t t l e , Washington. 1970. McDonald, Hamilton. "Labor and C o n t a i n e r i z a t i o n " , Unpublished M.B.A. Graduating Essay, U n i v e r s i t y o f B r i t i s h Columbia, Vancouver, B.C. May 1971. Payne, G. "The Con t a i n e r Way", Speech to the I n s t i t u t e of Naval A r c h i t e c t s and Marine E n g i n e e r s , Vancouver, B.C. A p r i l 23, 1971. Rees, Gordon S. " A n a l y s i s o f P o t e n t i a l C o n t a i n e r T r a f f i c i n the P o r t o f Vancouver", Unpublished M.B.A. The s i s , U n i v e r s i t y of B r i t i s h Columbia, Vancouver, B.C. 1§69. Robinson, Ross. " S p a t i a l S t r u c t u r i n g o f P o r t Linked Flows, P o r t of Vancouver 1965", Unpublished Ph.D. (Geography) Th e s i s , U n i v e r s i t y o f B r i t i s h Columbia, Vancouver, B.C. 1968. Studer, K e i t h . "Ship S i z e " , Unpublished M.B.A. The s i s , U n i v e r s i t y of B r i t i s h Columbia, Vancouver, B.C. 1969. "Study of the P o r t of Vancouver", Kates, Peat, Marwick & Co., Vancouver, B.C. 1967. ADVERTIZING LITERATURE "The C o n t a i n e r Way", A d v e r t i z i n g L i t e r a t u r e o f the Empire S t e v e d o r i n g Co. L t d . , Vancouver, B.C. n.d. " F u l l C o n t a i n e r S e r v i c e " , A d v e r t i z i n g L i t e r a t u r e o f the Yamashita-Shinnihon Steamship Co. Lt d . , Tokyo, Japan, n.d. "A New White Pass C o n t a i n e r Route Serves the Yukon and Northern B r i t i s h Columbia", A d v e r t i z i n g L i t e r a t u r e o f the White Pass and Yukon Railway Co., Vancouver, B.C. n.d. Cameron, Gordon. Shipping Agent for Yamashita Shinnihon, Ltd., North Pacific Shipping Co., Vancouver, B.C. March 10, 1971. Carlyle, Len. Port Engineer, National Harbour's Board, Vancouver, B.C. August 14, 1970. Cox, Ken. Western Assembly Ltd., Vancouver, B.C. April 20, 1971. Crook, Charles F. Manager Container Sales, Foreign Freight Sales, Canadian National Railways, Vancouver, B.C. February 24, 1971. Edgeworth, Dave. Freight Sales, Burlington Northern Railroad Co., Vancouver, B.C. April 21, 1971. Frontain, G.J. Manager Container Development, Canadian National Railways, Vancouver B.C. August 19, 1970. Garrod, Stan H. Foreign Freight Sales, Canadian Pacific Rail-way Co., Vancouver, B.C. August 6, 1970. Harrison, Mr. and Others. Checker, fork l i f t driver and members of the ILWU on Centennial Pier, Vancouver, B.C. May 6, 1971. King, Gordon. Shipping Agent for American Mail Lines, Trans-Pacific Steamship Co., Vancouver, B.C. May 6, 1971. Lindsay, Barry. Executive Assistant, Johnston Terminals Ltd., Vancouver,. B.C. February 1971. McGregor, Don. Customs Inspector, LaPointe Pier, Vancouver, B.C. September 1970. McGerrigle, Marjorie. Statistical Clerk, National Harbour's Board, Vancouver, B.C. Various dates, including August 14, 1970; December 8, 1970; May 7, 1971. Payne, Gordon. Manager, Container Terminal, Empire Stevedoring Co. Ltd., Centennial Pier, Vancouver, B.C. Various dates, including April 15, 1971; May 7, 1971. Shaneman, John. Clerk, Empire Stevedoring Co. Ltd. , Centennial Pier, Vancouver, B.C. April 15, 1971. Shaw, John.. Vice President Traffic, G i l l International Transport, Vancouver. B.C. March 5, 1971. Senior, Peter. Assistant Manager,, Container Terminal, Empire Stevedoring Co. Ltd., Centennial Pier, Vancouver, B.C. Various dates, including August 31, 1971; December 8, 1971; May 7, 1971. Staton, Eric. Foreign Freight Sales Representative, Canadian National Railways, Vancouver, B.C. October 19, 1971. Thomson, Albert G. Assistant Foreign Freight Sales Manager, Pacific Coast Ports, Canadian National Railways, Vancouver, B.C. Various dates, including October 19, 1970; February 24, 1971; May 31, 1971. TARIFFS Canadian Freight Association Eastbound Import Tariff No. 254-B (with supplements). Issued by G.H. Mitchell, Agent, Room 403, 272 Main Street, Winnipeg 1, Manitoba. Canadian Freight Association Import and Export Freight Tariff No. 263 (with supplements). Issued by G.H. Mitchell, Agent, Room 403, 272 Main Street, Winnipeg 1, Manitoba. Canadian Freight Association Container Tariff No. 589-A (with supplements). Issued by P.J. LaVallee, Agent, 1162 St. Antoine Street, Montreal 102, P.Q. Empire Stevedoring Company Limited and Terminal Dock Limited Wharf Tariff No. 4 (with revisions). Issued by Empire Stevedoring Co. Ltd., 395 Railway Street, Vancouver, B.C. Japan-West Canada Freight Conference Tariff No. 2 (with revisions). Issued by Japan-West Canada Freight Conference, Sumitomo Seimei.YAESU Building, 3, 4-chome-Yaesu, Chuo-ku, Tokyo 104, Japan. Seattle Terminals Tariff No. 2-F (with revisions). Issued by Hollis Farwell, Agent, Port of Seattle, P.O. Box 1209, Seattle, Wash. U.S.A. ISO TERMINOLOGY ISO recommendation 830 has been adopted by the m a j o r i t y of ISO members. DEFINITIONS  F r e i g h t C o n t a i n e r A f r e i g h t c o n t a i n e r i s d e f i n e d as an a r t i c l e of t r a n s p o r t equipments (a) o f a permanent c h a r a c t e r and a c c o r d i n g l y s t r o n g enough to be s u i t a b l e f o r r e p e a t e d use: (b) s p e c i a l l y designed to f a c i l i t a t e the c a r r i a g e of goods by one or more modes of t r a n s p o r t s without i n t e r m e d i a t e r e l o a d i n g ; (c) f i t t e d w i t h d e v i c e s p e r m i t t i n g i t s ready h a n d l i n g , p a r t i c u l a r l y i t s t r a n s f e r from one mode of t r a n s p o r t to another; (d) so designed to be easy to f i l l and empty; (e) h a v i n g an i n t e r n a l volume of 3 5 - 3 f t 3 (1 m3) or more. The term f r e i g h t c o n t a i n e r does not i n c l u d e v e h i c l e s or c o n v e n t i o n a l p a c k i n g . General-purpose F r e i g h t C o n t a i n e r T h i s i s a f r e i g h t c o n t a i n e r of r e c t a n g u l a r shape, weather-p r o o f , f o r t r a n s p o r t i n g and s t o r i n g a number of u n i t l o a d s , packages o r b u l k material; t h a t c o n f i n e s and p r o t e c t s the c o n t e n t s from l o s s o r damage; t h a t can be s e p a r a t e d from the means of t r a n s p o r t , handled as a u n i t l o a d and t r a n s h i p p e d w i t h o u t r e h a n d l i n g the c o n t e n t s . CHARACTERISTICS OF FREIGHT CONTAINERS N o n - c o l l a p s i b l e F r e i g h t C o n t a i n e r F r e i g h t c o n t a i n e r o f r i g i d c o n s t r u c t i o n , the components of which are permanently assembled. C o l l a p s i b l e F r e i g h t C o n t a i n e r F r e i g h t c o n t a i n e r of r i g i d c o n s t r u c t i o n , the major components of which can be e a s i l y f o l d e d or disassembled and then reassembled. FREIGHT CONTAINER WEIGHTS  Maximum Gross Weights Maximum a l l o w a b l e t o t a l weight of f r e i g h t c o n t a i n e r and i t s pay l o a d . Weight of empty f r e i g h t c o n t a i n e r . Maximum Payload Maximum a l l o w a b l e weight of pay l o a d ( g r o s s weight minus t a r e w e i g h t ) . A c t u a l Gross Weight T o t a l weight of f r e i g h t c o n t a i n e r and i t s payload. A c t u a l P a y l o a d D i f f e r e n c e between a c t u a l g r o s s weight and the t a r e weight of the c o n t a i n e r . STATIC AND DYNAMIC LOADS F l o o r Load S t a t i c and dynamic l o a d s imposed on the f l o o r by the pay l o a d and the wheels of h a n d l i n g equipment when used. End Load S t a t i c and dynamic l o a d s imposed by the payload on the f r e i g h t c o n t a i n e r w a l l s and doors which are p e r p e n d i c u l a r to the l o n g i t u d i n a l a x i s o f the f r e i g h t c o n t a i n e r . S i d e Load S t a t i c and dynamic l o a d s imposed by the pa y l o a d on the f r e i g h t c o n t a i n e r w a l l s and doors which are p a r a l l e l to the l o n g i t u d i n a l a x i s o f the f r e i g h t c o n t a i n e r . Roof Load E x t e r n a l s t a t i c and dynamic l o a d s imposed on the r o o f of a f r e i g h t c o n t a i n e r . Superimposed Load E x t e r n a l s t a t i c and dynamic l o a d s imposed v e r t i c a l l y downwards on the s t r u c t u r e o f the f r e i g h t c o n t a i n e r , DIMENSIONS AND VOLUME Dimensions Heig h t , width and l e n g t h o f a c o n t a i n e r , measured p a r a l l e l to each of i t s a x i s and expressed i n t h i s o r d e r . O v e r a l l E x t e r n a l Dimensions Maximum e x t e r n a l o v e r a l l dimensions of a c o n t a i n e r , i n c l u d i n g any permanent attachment. Displacement Volume of a f r e i g h t c o n t a i n e r as determined by the m u l t i -p l i c a t i o n of i t s " o v e r a l l e x t e r n a l dimensions. Dimensions determined on the g r e a t e s t u n o b s t r u c t e d r e c t a n g u l a r a r e a t h a t can be i n s c r i b e d i n the c o n t a i n e r , d i s c o u n t i n g c o r n e r f i t t i n g s . U n o b s t r u c t e d C a p a c i t y Volume determined by the m u l t i p l i c a t i o n of the i n t e r n a l u n o b s t r u c t e d dimensions. C a p a c i t y T o t a l i n t e r n a l volume. CONTAINER COMPONENTS  Corner S t r u c t u r e s V e r t i c a l frame component l o c a t e d a t the corn e r s of the f r e i g h t c o n t a i n e r , i n t e g r a l with the co r n e r f i t t i n g s and c o n n e c t i n g the r o o f and f l o o r s t r u c t u r e s . Corner F i t t i n g s F i t t i n g s l o c a t e d a t the corn e r s of the f r e i g h t c o n t a i n e r which n o r m a l l y p r o v i d e means f o r h a n d l i n g , s t a c k i n g and s e c u r i n g the c o n t a i n e r . End Frame Each of the s t r u c t u r e s of the c o n t a i n e r p e r p e n d i c u l a r to i t s l o n g i t u d i n a l a x i s c o n s i s t i n g of the co r n e r s t r u c t u r e s and the end members of the base and of the r o o f . End W a l l Assembly surrounded by the end frame which e n c l o s e s e i t h e r end o f the c o n t a i n e r . S i d e Frame Each of the s t r u c t u r e s p a r a l l e l to the l o n g i t u d i n a l a x i s of the c o n t a i n e r c o n s i s t i n g of the c o r n e r s t r u c t u r e s and of the bottom s i d e r a i l s and r o o f r a i l s . S i d e W a l l Assembly surrounded by the s i d e frame e i t h e r s i d e of the c o n t a i n e r . Roof R a i l s L o n g i t u d i n a l s t r u c t u r a l members s i t u a t e d a t the top edge on e i t h e r s i d e of the f r e i g h t c o n t a i n e r . Bottom S i d e R a i l s S t r u c t u r a l members s i t u a t e d on the l o n g i t u d i n a l s i d e s of the base. End Door Door l o c a t e d i n an end w a l l . Roof Assembly f o r m i n g the top c l o s u r e o f the c o n t a i n e r l i m i t e d by the end frames and the r o o f r a i l s . Base Assembly of which the p r i n c i p a l components a r e : (a) the two bottom l o n g i t u d i n a l members, (b) the two bottom end-members, (c) the f l o o r , and (d) p o s s i b l y the cross-members. Cross-Members T r a v e r s e components a t t a c h e d to the bottom s i d e r a i l s and s u p p o r t i n g the f l o o r . F l o o r Component s u p p o r t i n g the p a y l o a d . S k i d s Beams on which c e r t a i n f r e i g h t c o n t a i n e r s are mounted to f a c i l i t a t e h a n d l i n g . Fork Pockets Openings arranged f o r the e n t r y of the f o r k s of h a n d l i n g d e v i c e s . Source: C o n t a i n e r i s a t i o n I n t e r n a t i o n a l Year Book 1970* N a t i o n a l Magazine Co. L t d . London. I 9 6 9 . pp. 80-82.. ISO CONTAINER DEFINITION ISO Recommendation No. 804 d e f i n e s a c o n t a i n e r as an a r t i c l e o f t r a n s p o r t equipment: A. of a permanent c h a r a c t e r and a c c o r d i n g l y s t r o n g enough to be s u i t a b l e f o r repeated use? B. s p e c i a l l y designed to f a c i l i t a t e the c a r r i a g e of goods, by one o r more modes of t r a n s p o r t , without i n t e r m e d i a t e r e l o a d i n g ; C. f i t t e d with d e v i c e s p e r m i t t i n g i t s ready h a n d l i n g , p a r t i c u l a r l y i t s t r a n s f e r from one mode of t r a n s p o r t to another; D. so designed as to be easy to f i l l and empty; 3 3 E. having an i n t e r n a l volume of lm (35*3 f t ) or more. The term ' f r e i g h t container* i n c l u d e s n e i t h e r v e h i c l e s nor c o n v e n t i o n a l packing. 'Rating' means the maximum gros s weight and i s the maximum p e r m i s s i b l e combined weight of the f r e i g h t c o n t a i n e r and of i t s c o n t e n t s . Two s e r i e s of f r e i g h t c o n t a i n e r s were approved: s e r i e s 1 h a v i n g a uniform c r o s s - s e c t i o n of 2,438 mm x 2,438 mm (8 f t . x 8 f t . ) , and s e r i e s 2 having a uniform h e i g h t of 2,100 mm (6 f t . 10^ i n . ) . See s e r i e s 1 and 2 c o n t a i n e r s on the f o l l o w i n g page. Source: , C o n t a i n e r i s a t i o n I n t e r n a t i o n a l Year Book 1970. N a t i o n a l Magazine Co. Ltd. London. 1969. PP. 74-75. SERIES 1 Designation Height Width Length Gross weight Approximate interior cubic capacity Ft Metres F' Metres Ft in. Metres Pound Tons Kilos Metric tons Cu. ft Cu . metres 1 A 8 2.438 8 2.433 40 12.192 67 ,200 30,480 2189 62 30 30.4814 1 B 8 2.438 8 2.438 2 9 - 1 1 i 9.125 56.000 25.200 1624 46 25 25.4012 1 C 8 2.438 8 2.438 1 9 - 1 0 4 6.055 44 .800 20,160 1077 30. F 20 20.3209 1 D 8 2.438 8 2.438 9 - 9 } 2.990 22.400 10,080 530 25 10 10.1605 1 E 8 • 2.438 8 2.438 6 - 5 j 1.969 15.680 7,056 318* 9* 7 7.1123 1 F 8 2.438 8 2.438 4 - 9 ) 1.460 11,200 5,040 • • 5 5.2080 S E R I E S 2 Ft in. Metres Ft in. Metres Ft in. Metres 2 A 6 10; 2.100 7 G J 2.300 9 - 7 2.920 15,680 7 2 B 6 -10! 2.100 B 1 0 ; 2.100 7 - 1 0 1 2.400 15,680 7 2 C e 10; 2.100 7 n; 2.300 4 - 9 1.450 15.680 7 APPENDIX I I I C O N T A I N E R T Y P E S There are many variations to basic container types. Here are a few of the more usual designs. COVERED TOP BULK LOADED TYPE 6.7 JOINED UNITS TANK COLLAPSIBLE FLAT BED 0 M X END LOADING CAGE - FRAME VENTILATED SIDE LOADING OPEN TOP AND OPEN SIDES HALF HEIGHT-BULK REFRIGERATED (REEFER) SPECIAL- EXPERIMENTAL \\ . . . /!.T\\. . / - ^ ,>'3 TOP LOADING AUTOMOBILE CONTAINER LIVESTOCK CONTAINER PARTIAL LIST OF SHIPPING COMPANIES  CALLING AT PORT OF VANCOUVER December 30, 1970 Anglo-Candaian S h i p p i n g (Westship) L t d . Bakke Steamship C o r p o r a t i o n B a l f o u r G u t h r i e (Canada) L t d . Canadian T r a n s p o r t Company L t d . Canworld S h i p p i n g Co. D i n g w a l l C o t t s & Company L t d . Dodwell & Company L t d . Empire S h i p p i n g Company L t d . Furness Withy & Company L t d . Greer S h i p p i n g L t d . Greer, B.W. & Co. L t d . Johnson, C. Gardner L t d . Johnson Walton Steamships L t d . Kerr Steamship Co. L t d . K i n g s l e y N a v i g a t i o n Company L t d . Mann S h i p p i n g L t d . .North P a c i f i c S h i p p i n g Co. L t d . Ocean Log T r a n s p o r t Co. L t d . Overseas Marine S e r v i c e s L t d . P a c i f i c E xport L i n e L t d . P a c i f i c I n t e r n a t i o n a l F r e i g h t l i n e r s L t d . Sagus Canada L t d . Seaboard S h i p p i n g Company L t d . S t a r Bulk S h i p p i n g Co. (Canada) L t d . Trans-Oceanic S h i p p i n g Co. L t d . Trans P a c i f i c Steamship Agencies L t d . T r a n s p a c i f i c T r a n s p o r t a t i o n Co. L t d . Vanport S h i p p i n g Agency L t d . Western Overseas S h i p p i n g L t d . Westward S h i p p i n g L t d . World Wide S h i p p i n g L t d . Source: L i s t of Members of Vancouver Merchants Exchange, 355 B u r r a r d S t . , Vancouver, B.C. NATIONAL HARBOURS BOARD Centennial N N6" 40 ton Container Crane-Physical Properties • Gauge-43' • Total Spreader Beam Travel- 193-6" • Maximum Outreach from Dockside Rail-113-6" • Clearance Under Gantry-39-6" o Hoist Speed- 100 f.p.m.-30 ton load, 250 f.p.m.empty • Trolley Travel Speed-400 f.p.m. • Crane Travel- 150 f.p.m. APPENDIX V I • JAPAN-WEST CANADA FREIGHT CONFERENCE TARIFF NO. 2 Orig./Rev. Original Page ~49 Cancels Page V . Effective Date From: Ports in Japan, Korea and Okinawa To: Pacific Coast Ports of Canada (See Title (See RuleNos. 34, 36 and 37) * Page) October 1, 1970 Correction RULES FOR CONTAINERIZED CARGO 100. Definitions of Technical Terms Container Container Freight Station (CFS) Container Yard (CY) Container Services Place of Rest The term " container " means a single rigid, non-disposable; dry cargo, ventilated, insulated, reefer, flat rack, vehicle rack, portable liquid tank or open top containers without wheels or bogies attached having, not less than 135 cubic feet capacity, having a closure or permanently-hinged door, that allows ready access to the cargo. All types of containers will have construction, fittings, and fastenings able to withstand, without permanent" distortion, all the stresses that may be applied in normal service use of continuous transportation. . The term "container freight station" (CFS) means the location designated by carrier for the receiving and delivery by carrier or his authorized agent of goods to be or which have been moved in containers; provided, however, such container freight station'must be adjacent to carrier's container yard as defined hereunder. At base ports in Japan, no Member shall use or designate more than three CFS's per port, and location of CFS must be on file with the Conference Chairman. The term " container yard" (CY) means the location designated by carrier in the port area where (1) the carrier assembles, holds, or stores containers; and (2) where containers loaded with goods are received or delivered. The term " container services " means the services performed at loading port in receiving and loading cargo into containers at CFS and transporting such containers from CFS to CY. •;. .,y;: . - .••'-•;..'>•.. . ••• The term "place of rest" as used in the Containerized Cargb Rules means that location on the floor, dock, platform, or doorway at CFS to which cargo is first delivered by shipper or agent thereof, or from which cargo is first ready to be delivered to consignee or agent thereof. • JAPAN-WEST CANADA FREIGHT CONFERENCE TAR I F F NO. 2 Orig./Rev. | Page 2nd Revised j 50 Cancels j Pago 1st Revised i 50 From : Ports in Japan, Korea and Okinawa To: Pacific Coast Ports of Canada (See Title (See Rule Nos. 34, 36 and 37) Page) Effective Date January 28, 1971 Correction J 164 RULES FOR CONTAINERIZED CARGO 101. Application of Rates (A) Local Rates (1) The local ratC3 named in this tariff apply from CY at loading port to CY at destination port. Cargo may be delivered to carrier at CY and/or received by consignee at CY only in containers and only as set forth in Rule Nos. 107, 108 and - -•' HI. . (2) Local cargo delivered to consignee at CFS or CY shall be assessed Pacific Coast Handling Charge as set forth in Rule No. 23. (3) Local cargo received by carrier at CFS, except in shipper loaded container when requested by carrier under Rule No. 115(B)(2), shall be assessed a container service charge as set forth in Rule No. 102. •< (4) Local rates do not include wharfage. (B) OCP Rates The OCP rates named in this tariff will apply to cargo which moves via CFS or CY at ports of discharge on the Pacific Coast from: (a) CY at loading port, or • -(b) CFS at loading port, subject to additional container service charge named in Rule No. 102, except in shipper loaded container when requested by carrier under Rule No. 115(B)(2). . OCP rates are subject to the provisions of Sections (d) through (k) of Rule No. 3. 102. Container Service On cargo delivered to CFS at loading port, the applicable container service charge Charge assessed against the cargo shall be 82.00 per revenue ton, except at Korean ports which • (R) shall be $ 1.00 per revenue ton, subject to a minimum charge of $2.00 per Bill of Lading. The Container Service Charge shall be paid prior to issuance of Bills of Lading. At Korean ports, the Container Service Charge may be prepaid in Korean Won (see Rule »"-•'•• • ' •'' ' No.'5). . . • • Commodities which carry rate bases other than 40 eft., 2,000 lbs., or 2,240 lbs. (i.e., per unit, ad valorem, etc.) will be assessed the Container Service Charge on a " revenue ton " • of 2,000 lbs. or 40 eft. whichever produces the greater revenue. The total amount of container service charges assessed against shipments shall be : stated on the Bills of Lading for such shipments, preceded by the following words: " "Container Service Charge @82.00 per revenue ton." 103. Household Goods, Unless the entire container of Household Goods, Secondhand Furniture and Personal Effects Secondhand Furniture are packed in boxes, cases or footlockers, 100% of the container's inside cubic mensure-and Personal Effects ment shall be used as the basis for ocean freight and other charges. .. 104. Unitized Cargo (A) Reduced rates or allowances provided for in individual Tariff Items subject to Rule No. 40 (Unitized Cargo) are applicable to unitized cargo in a carrier packed container but are not applicable to unitized cargo shipped in a shipper packed container. (B) The weight or measurement of the. pallet of unitized cargo shall be excluded in calculating freight charges, whether shipped in a shipper or carrier packed container, subject to the provisions set forth under Rule Nos. 40(E) and 41(A)(4). . . . . (C) The weight or measurement of the pallet shall be included in the calculation of the minimum utilization of the container pursuant to Rule No. 115(A) with respect to a shipper packed container. JAPAN-WEST CANADA FREIGHT CONFERENCE TARIFF NO. 2 Orig./Rev. Page Original 53 Cancels | Page 1 V From : Ports in Japan, Korea and Okinawa To: Pacific Coast Ports of Canada (See Title (See Rule Nos. 34, 36 and 37) Page) Effective Date October 1, 1970 Correction | RULES FOR CONTAINERIZED CARGO 108. Use of Carrier's (A) The use of carrier's container by shipper, consignee, or agent thereof, is limited to Container by Shipper the following: or Consignee - _„ i_. Removal by shipper or his agent of carrier's co'ntainer when available, with or • - without Skeletal' Semi-Trailers, from CY for loading and return to the CY ' designated by carrier. Cargo so loaded is subject to Rule No. 111. . 2 . Removal by conuignee or hi3 agent of loaded carrier's container, with or without . Skeletal Semi-Trailers, from destination CY for unloading and return to CY '.: designated by carrier. • 3. Unless otherwise specifically designated by carrier, containers and/or Skeletal Semi-Trailers, shall be returned to the CY from which removed. ,4. Shippers, consignees and/or their authorized representatives must assume full responsibility for the safety of the container and/or Skeletal Semi-Trailer9, ir-:. while in their possession and the safe return thereof to the carrier. (B) The use of carrier's containers is also governed by the provisions of Rule • No; 107. • _ (C) All expenses in connection with pick-up/delivery of empty/loaded containers and . - packing/unpacking shall be for account of the cargo. Exception: Cost of lifting containers to or from chassis, truck or rail cars.when , ; such service is performed at container yard is to be borne by the carrier. 109. Use of Carrier Owned/ Carriers are permitted to provide Skeletal Semi-Trailers at discharge ports at a rental Controlled Skeletal charge of 85.00 for each 24 hours or fraction thereof except when moving under an Semi-Trailers Interchange Agreement with Inland Carriers. JAPAN-WEST CANADA FREIGHT CONFERENCE TARIFF NO. 2 jOrin./Rey. | Page 2nd Revised \ 55 Cancels Page 1st Revised I 55 Effective Date From: Ports in Japan, Korea and Okinawa (See Rule Nos.~:34, 36 and 37) To: Pacific Coast Ports of Canada (Sec Title Page) April 24, 1971 Correction 3 6 7 RULES FOR CONTAINERIZED CARGO 112. Clausing of . . Bills,of Lading Cargo in containers'may be stowed under deck or on deck at the carrier's option. Bills of Lading specifically claused to provide under deck stowage will not be issued for container cargo.. •. • :.-•'' • '•-,.'. 113., Stowing Two or More ;Carrier -reserves' the right to stow two or more shipments or parts thereof in one Shipments in One carrier's container^ except containers freighted under Rule No. 115 (A); Container ..... I. . V • .•' ;:. :-]... • • '-.- •-.„• 114. Heavy Lifts ; • •": General "' CY to CY Cargo. CFS-to CY or CY to CFS Cargo Returned Empty - Containers Heavy lift charges'shall apply to any single piece or package within the container in • accordance with the heavy lift scale in Rule No. 29, except as hereunder provided. Heavy lift charges shall not apply to pieces or packages which are, pocked in containers by the shipper outside CFS and unpacked by the consignee outside CFS, at the expense of the shipper/consignee. •••'.' If either shipper or consignee uses its gear exclusively in packing or unpacking cargo outside CFS at the expense "of the shipper/consignee, 50% of the heavy lift charge shall be assessed. , • i.-'', •"''. -., • . . • •• <•••.'•• .... . Heavy lift charges', shall, not apply to. returned empty containers. *•'"-. (C)115. < Exclusive Use' (I) "(A) When a container is loaded for the exclusive use by the shipper or his authorized i .  >t- representative and delivered to the CY, freight charges shall be calculated at the !..-. , ' 'applicable .rate of the contents subject to the minimums as set forth below. When •' a .shipper, loads or partly loads only one container the minimum.rule as set forth below ' will apply.;.. • -. . . . . . . . . . . . j - . , ^  ^ case.of container loaded with a single commodity rated on a measurement .'.-"Ci. basis,'' th'e- minimum' shall be calculated at (a) 8 5 % or (b) 7 5 % of the total inside cubic'capacity of the container except where the weight capacity of the container . », , : .has been fully utilized. ..-.''? ';.. In. the'case of container loaded with a single commodity rated on a weight basi3, the minimum shall be calculated at 95% of the total'weight capacity'of the container except where the cubic capacity of the container has been fully utilized.. -'•!;,••.'. . ', : : •"' • ' i . . When the contents of a container consist of more than one commodity, freight •. charges, shall be calculated at the rate applicable on each commodity therein and provided that the total aggregate equals on a measurement basis at least: '..•'•;'".'•' (a) 8 5 % or (b) 75% of the inside cubic capacity of.the container or on a weight basis at least 95% of the weight capacity of the container regardless of -whether - the commodities are rated on a weight or measurement . basis;'however, if the total measurement and weight is less than the above-stated minimums, freight shall be assessed on the lower deficiency at the rate applicable, to the highest-rated commodity. ; • (a) Applicable only to containers with external length of 19 feet or greater. ''" ' (b) Applicable only to containers with external length less than 19 feet. 4. This rule applies only when exclusive use is requested by the shipper and notation is made on the Bill of Lading that " shipper has requested exclusive use ". 2. 3. A P P E N D I X V I I JAPAN-WEST CANADA FREIGHT CONFLUENCE TAHIFF NO. 2 Orig.^Ruv. 2nd Revi sod Page "237" Cancels 1st R evised Pap.e 237 Prom: P o r t s i n Japan, Korea and To: P a c i f i c Const P o r t s " o f Canada Okinawa (Soe Rule Nos. JU, (See T i t l e Page) 36 and 37) E f f e c t i v e Date A p r i l 1, 1971 C o r r e c t i o n 380 Except as otherwiee p r o v i d e d h e r e i n , r a t e s a p p l y per ton o f 2,000 l b s . o r UO e f t . , whichever producer, the g r e a t e r revenue, Commodity Code Commodity d e s c r i p t i o n and P a c k i n g Rate B a s i s Base Port3 P a c i f i c L o c a l O.C.P. Item No. MACHINERY AND TRANSPORT EQUIPMENT (Cont'd) Machinery and' Part3 (Cont'd) T y p e w r i t e r s and P a r t s Value not e x c e e d i n g U,300.00 p e r revenue t o n F.O.B. Value exceeding $1,300.00 p e r revenue t o n F.O.B. Note: On u n i t i z e d shipments under T a r i f f Rule No. U0, the p r o t e c t i v o m a t e r i a l to be c o n s i d e r e d as p a r t o f the p a l l e t . Water Turbines S p e c i a l Rate M a c h i n e r y , not elsewhere covered i n t h i s t a r i f f i n c l u d e s : • A g r i c u l t u r a l and Garden C o n s t r u c t i o n and M i n i n g C o o l i n g Generators (not o t h e r w i s e named i n t h i s d i v i s i o n ) M a n u f a c t u r i n g and P r o c e s s i n g M achinery P a r t s , N o n - e l e c t r i c a l , not o t h e r w i s e named i n t h i s D i v i s i o n fro:'i Kobe t o V i c t o r i a , B.C, (I) Machinery P a r t s 00 The minimum q u a n t i t y requirement o f 500 revenuo tons on G e n e r a l Cargo f o r d i r e c t dir.ch.irgo at V i c t o r i a , B.C. i s reduced t o 270 revenue tons c o v e r i n g a s i n g l e shipment of Machinery P a r t s , e f f e c t i v e A p r i l 1, 1971, e x p i r i n g A p r i l 30, 1971. 55.00j/ 32.50 U.25 U.25 39.CXV 51.00s/ (5180-00) 5180-05 5180-10 UO. 50 AO. 50 5210-00 5220-00 52AO-00 Note 1 Note 2 Note 3 Where no r a t e s are shown under "O.C.P." the P a c i f i c l o c a l Kates w i l l a p p l y . For e x p l a n a t i o n o f a b b r e v i a t i o n s and r e f e r e n c e marks, see T a r i f f Page No. 8. For commodities annotated by "ft", $3.00 r e d u c t i o n ia a u t h o r i z e d f o r u n i t i z e d s hipments, s u b j e c t t o T a r i f f Rule No. 1,0. APPENDIX V I I I Source: S h i p p i n g Report, I n t e r n a t i o n a l Seaborne S h i p p i n g , P a r t IV, DBS # 54-206, Queens P r i n t e r , Ottawa. 1967. Deep Sea E x p o r t s , F i l e s of N a t i o n a l Harbour's Board, Vancouver. 1968. 1969. Aust Ceylon China F i j i Hong Ccmia Kong In d i a Japan Korea New Paki s P h i l Snspare Taiwan Z e a l d MaTysia T h i l d Fie a t ' 95 1485 55 145 F i s h 25 25 D a i r y Prod 5 565 F r u i t 30 70 Vegetables 35 35 Prep. Food 155 10 445 Fodder 65 Beverages 25 25 H i d e s , S k i n s Crd AnVegFd 15 20 T e x t i l e s 5 Iron scrap 45 Other s c r a p Asbestos 15820 Lumber 14230 5 575 370 Plywood 510 Woodpulp 5645 125 Newsprint 2260 605 1925 Paper 395 10 760 Tallows,Fats ChemSjPlasik: 4745 10 55 F e r t , E x p l o s 6145 S t e e l 5 75 20 A2,Ci}ZnNiPb 225 1745 140 5 1115 Machinery 700 5 60 A u t o s , P a r t s 150 25 45 Tools,Equip 10 105 P e r s o n a l Gd 235 530 K i s q G e n e r a l 60 935 10 Wheat f l o u r 29650 790 16255 6030 80 270 885 94725 5 565 85 610 . 1 0 34570 50 1055 170 5 170 65925 200 3095 105 510 1485 10200 6100 46700 2415 128650 150 445 20215 2255 409460 31580 18275 1500 35 45 90 0 5 20 110 20 1020 10 45955 190 5 240 48 830 110 5 1935 4500 175 365 88780 40 385 315 185 20 40 25 20 45 190 10 65 5 35 25 55 10 1540 180 1715 400 1140 330 2645 1400 1505 605 1775 5 20890 50 100 345 2380 990 35 55 165 10 55 15 95 10 20 75 790 A% 15 25 30 350 35 65 16410 1515 915 260 25 755 52990 32515 T50 22f545 751620 2265 137830 4839o 15 355 55 30 170 3755 97710 10800 20385 2700 26585 5680 Meat F i s h D a i r y Prod F r u i t V e g e t a b l e s Prep. Food Fodder Beverages Hides£kins Crd An,VegPd Iron scrap Asbestos Lumber Plywood Pulpwood Newsprint Paper Tallow Rits Chemicals F e r t i l i z e r S t e e l AlCuNiZnPb Machinery AutosParts Tools.Equip P e r s o n a l Gd Misc Wheat f l o u r Aust Ceylcn 15 955 240 95 65 30 22500 9440 8360 3240 915 2650 7085 336O 655 715 155 195 120 525 China F i j i Hong In d i a Japan Korea • Ocenia Kong  30 110 55 90 19790 185 150 45 25 65 170 600 70 460 40 80 25 38O 2890 1215 125 3990 10 155 125 35 99105 1545 15 20 235 100 8095 10 540 1720 75 45 350 103980 215 4340 460 5550 9305 38505 230 46765 1555 2720 29475 30460 665 32345 2895 675 75 50 590 755 New P a k i s PhilSrgpore Taiwan Zeald l'.'ialysJa  TrrLld 50 690 10 120 30 5 25 50 10 25 005 105 5 340 1365 1990 1515 625 20 380 215 1685 320 55 850 1250 95 5950 2305 220 390 30 20 425 10 015 235 335 4240 1590 180 220 55 50 80 170 585 130 35 10 35 55 15 125 70 225 75 15 50 A n i - < 1 9 5 0 0 , n 8 4 5 o 101110' 61315 30 18230 284905 3365 4910 2015 40 20 2830 695 10 20 330 565 2695 2880 30 15 25 3860 18305 7430 6320 7595 COMMODITY ITEM Aust Ceylcn China F I J I Oosrua Hong Kong In d i a Japan Korea New Ze a l d P a k i s PhilSngxxe Taiwan MaT,\sia Ohild Meat 5 380 1205 15 10 F i s h 955 30 40 1845 375 10 100 D a i r y Prod 125 105 F r u i t 40 60 115 V e g e t a b l e s 10 60 Frep.Food 40 5 30 10 5 30 Fodder 117780 315 20 Beverages 30 40 170 35 15 10 25 35 15 Hides S k i n s 5 8855 1395 60 20 95 Crd AnVegpd 85 65 195 40 T e x t i l e s 105 5 20 235 Iron Scrap 3230 220 3830 195 Asbestos 23975 860 7245 11210 4320 1870 2235 Lumber 2610 860 365 28065 950 15 Plywood 35 460 295 6745 880 Woodpulp 9940 60 83850 2695 675 595 1265 Newsprint 3365 610 45 4550 1595 370 1605 3145 185 Paper 695 25 1550 140 5 15 50 115 335 TallowFat 1910 150 29815 Chems 5365 25 8100 385 250 45 45 F e r t i l i z e r s 18860 141555 55 S t e e l 245 5 10 25 215 65 AlCuNiZnPb 740 110 2790 2755 4420 1530 420 5 2495 1845 1295 2815 Machinery 575 45 515 15 845 585 350 Autos P a r t s 190 5 105 115 420 TooIs,Equip • 455 10 10 5 145 170 P e r s o n a l Gds 170 . 30 35 110 75 35 10 25 25 5 10 Misc 375 10 5 5 120 30 260 20 75 10 210 30 10 15 Wheat f l o u r 80 5940 15 740 10 80 3140 APPENDIX IX Source: Shipping Report, International Seaborne Shipping, Part IV, DBS # 54-206, Queens Pri n t e r , Ottawa. 1967. Deep Sea Imports, F i l e s of National Harbour's Board, Vancouver. 1 9 6 8 . 1969. 1970. COMMODITY Aust Ceylm China F i j i Hong India Japan Korea New ITEM Oaaaia Kong Zeald Fish 10 65 1300 235 Nuts 8560 80 110 55 55 Macaroni Meat 9000 1370 SausageCase 210 60 Dairy Prod 60 1230 Vegetables 20 140 20 30 40 710 F r u i t 8500 265 21000 880 Coffee Tea 410 25 255 410 1710 Misc Food 4320 2950 90 2960 500 Wine Liquor 1800 35 330 15 Unmilled Cereal 2130 Wool,Hair 480 130 Textiles 520 2910 740 8200 700 20 Jute-woven 4150 Misc Fabric 3960 F e r t i l i z e r 1720 SteelProds 11690 255 135: 188970 370 140 Mach & Equip 550 1190 93000 40 Autos 5300 ChemsPlastic 60 285 3760 Lumber 220 4900 Plywood 50 310 7830 PaperBldg Bd 20 500 BrickTileGlas 270 3730 Cement 4550 Mine Prods 3050 160 1350 11420 1495 HouseHold Gd 230 5 590 19820 680 40 Misc,General 270 1090 2680 2265 1 8 2 1 0 10 Pakis P h i l 3ngx>re Taiwan TrUd Malysia  10 1350 150 400 4 0 7 6 0 1 2 7 2 5 22485 394470 415 1645 8465 2065 i i 160 440 45 1015 565 430 180 1770 40 1270 725 390 20 1500 590 5105 85 300 100 190 80 60 870 1815 3770 50 435 70 15600 250 80 120 I63O 545 150 195 260 4230 280 190 3115 29505 7840 1570 COMMODITY Aust. Ceylon China F i . i i Hong India Japan Korea New Pa k i s P h i l Sngxre Malysia 'Taiwan Trald ITEM Gosnia Kong Zeald F i s h 70 320 45 3870 155 5 60 15 Nuts 140 8090 - 85 265 830 35 Meat 6055 2780 D a i r y Prod 350 1475 Vegetables 170 10 625 2420 F r u i t H83O 24100 1455 2300 390 150 Coffee Tea 1260 80 120 10 790 215 20 Misc Food 100 500 3385 35 1280 120 20 1155 WineLiquor 1700 170 10 1845 C e r e a l .mil 1695 Wool, H a i r 3^55 1115 T e x t i l e s 70 2660 9630 615 23950 3025 25 105 235 1135 8015 Jute-woven 6545 350 65 Rubber 400 2375 Toys&Games 15 65 4945 7900 10 330 S t e e l P r o d s 11435 145 565 55 146600 45 45 100 310 Mach&Equip 815 95 1880 37830 65 440 Autos 720 21515 5 ChemFertiz 1-75 5090 Lumber 85 4425 2030 515 7100 220 Plywood 9035 1940 1290 19865 PaperBldgPrd 390 Glas&Prods 645 30 • .15 5600 3735 Cement 4000 Mine Prods 250 . 50 1850 85 105 6005 280 385 HouseHold Gd 185 5 765 50 1500 55 10 65 35 5 M i s c , G e n e r a l 650 3465 155 10065 60 85 3? 60 55 620 38430 14240 25230 313845 7795 4680 44-535 2220 1400 2060 8660 5300 775 7220 F i s h Nuts Meat D a i r y Prod Vegetables F r u i t C o f f e e Tea Misc Food Wine L i q u o r C e r e a l M i l l d Wool,Hair T e x t i l e s Jute Rubber Toys&Games S t e e l P r o d s Mach&Equip Autos ChemFertiz Lumber Plywood Paper BldgPd AsbstGlasPds Cement Mine Prods HouseHoldGd M i s c , G e n e r a l Aust Ceylon 50 10700 25 8750 75 I870 995 60 30 25975 565 65 245 40 35 715 480 170 _ 9 2 1 China F i j i Hong I n d i a Kong  Japan Korea New Z e a l d 10 9145 50 180 330 1110 120 1470 835 2990 70 220 105 210 51770 15 5 6 3 0 50 420 670 125 35 110 5 3740 10 11320 1 6 3 2 5 5665 520 2750 5 5 115 30 30 140 905 15 m° 5 180 1120 260 30045 465 60 555 5130 260 25 95 5 120 35 150 2995 20 18060 10 1125 185 1205 9140 196940 38355 31680 7680 6270 10935 570 6315 3615 8320 1115 1Q225 50 24020 3035 65 495 80 8160 5 470 795 5 20 15 5 115 P a k i s PhilSngxre Taiwan Tmld Malysia  50 100 20 840 35 1880 250 20 760 185 36O 1070 1475 30 2595 5 30 5 15 25 2500 950 20 640 7805 20 560 530 810 378805 7085 5 315 1390 2840 4035 210 2390 145 280 21200 2820 95 40 105 255 5 20 15 45 70 15 75 45 60 75 10 970 9675 2895 42300 6620 1830 10225 885 COMMODITY Aust Ceylon China F i j i Hong Indi a Japan Korea New Pakis P h i l Shgoore Taiwan ITEM (tenia Kong Ze a l d I'/iaTysia F i s h 55 405 5 4400 70 105 60 120 35 25 Nuts 3895 85 240 185 1060 55 Meat 12065 9730 D a i r y Prod 35 15 3065 Vegetables 335 115 1430 F r u i t 5155 660 22090 110 1215 1465 C o f f e e Tea 1200 80 130 610 290 20 Misc Food 115 600 4050 85 1270 205 370 Wine Liquor 2110 200 135 Feed, Mill Cer 775 190 CrdAn-VegPd 50 135 195 50 Wool 140 70 T e x t i l e s 100 610 910 440 11140 540 65 30 280 90 1305 Jute 4885 3050 Rubber 20 510 2375 Toys Games 25 100 5905 7590 95 20 65 10 1035 S t e e l Prod 6285 550 325 30 231245 49055 1780 1010 Mach&Equip 655 2320 30 80 100 70 1090 Autos 95 31560 ChemsFertz 50 475 8530 1360 Lumber 20 445 1850 20 2150 1445 Plywood 10910 2020 1320 175 16135 Paper&Prod 1225 4685 AsbestGlas 80 50 8160 Cement - 4415 MineFd(proc) 455 15 175^0 125 ApparlPootwre 85 1230 9070 130 9925 2490 75 550 9715 HouseHoldGd 250 480 55 295 65 25 85 5 Misc, Generl 1055 405 15 3375 270 11170 135 130 10 120 180 1045 28880 9145 27655 436955 12005 4445 7945 42415 1200 230 6735 5210 5190 Tni ld 2470 10 APPENDIX X Source: S h i p p i n g Report, I n t e r n a t i o n a l Seaborne S h i p p i n g , P a r t I, DBS # 54-202, Queens P r i n t e r , Ottawa. 1967. 1968. COMMODITY ITEM Aust Ceylon China CONTAINERIZABLE PRODUCTS F i j i Hong I n d i a Japan Korea Gosnia Kong New Z e a l d P a k i s PhilSngnre Taiwan Malysia Thild Meat 16200 368O F i s h 10 10 1240 N u t s O i l s e d 6 0 0 2 3 7 0 1 1 2 1 0 2 5 6 0 980 D a i r y Prod 1 7 7 0 Wheat&Prod 10 30 1 2 7 0 Vegetables 10 1 1 0 15 30 80 F r u i t 1 9 3 0 0 225 5 6 3 0 C o f f e e Tea 6 2 3 0 160 1 0 0 2 0 10 5 6 0 9 1 0 Misc Food 4280 4 5 0 50 480 1060 630 70 80 Beverages 750 10 AnimVegOil 60 7900 20 250 1 5 8 2 0 Wool,HairHds 2 7 6 0 1840 Feeds 120 50 T e x t i l e s 1240 3610 1 4 1 8 0 4 9 3 0 50 9 3 8 0 40 160 60 Jute 180 36060 5 4 0 0 Rubber&Pds 2860 30 870 295 40 33480 10 4 o Chem&Prods 420 60 3220 30 30 10 Wood&Prods 20 100 30 638O 230 40 6 7 0 0 1 6 1 7 0 90 MineProds 3 6 2 8 0 20 4570 3 6 9 0 4 4 8 0 50 230 S t e e l P r d s 2 1 0 0 1190 120 2 9 7 8 0 30 20 2 0 0 G l a s B r i c k 2 2 0 5990 40 Mies,Hshld 2 0 4 8 0 510 130 9 6 7 0 7130 6 4 9 0 0 320 1 2 6 0 520 4 8 0 7080 6 9 5 0 1 0 3 4 9 0 2 1 3 9 0 130 2 6 5 5 0 7 1 2 3 0 1 2 2 4 3 0 1 7 0 0 1 3 0 0 0 1 5 8 6 0 5 9 8 0 7 2 1 2 0 2 3 4 8 0 2 3 9 0 COMMODITY Aust Ceylon China F i j i Hong In d i a Japan Korea New Pakis P h i l Srgpie Taiwan Ohild ITEM Kong Z e a l d Malysia Meat 26990 10 12240 F i s h 10 40 1 8 0 0 -N u t s O i l s e d 2890 2 3 8 0 1 6 7 0 858O 4 7 0 1 3 9 0 D a i r y P r o d 1 2 0 1 5 5 0 Wheat&Prod 30 40 20 10 1 0 3 0 680 Vegetables 1 1 0 170 2 2 0 40 2 2 0 110 F r u i t 3 2 8 2 0 10 420 800 830 4 6 2 0 50 C o f f e e Tea 8490 2 5 0 1 0 1 9 0 150 800 60 Misc Food 4 3 7 0 116,0 120 2520 2180 - 120 l l 6 0 " 130 Beverages 1240 10 40 Molasses 1 5 4 3 0 -AnimVegOil 30 1320 740 20 3630 1 7 4 0 0 Wool,HairHds : 3 4 6 0 10 Feeds 90 240 T e x t i l e s 1360 3 8 0 0 8990 8000 60 3 6 6 0 60 240 240 140 Jute 1140 19940 1 9 1 0 Rubber&Prds 1870 2 5 0 740 400 20 140 3 4 1 7 0 10 2 1 0 Chems&Prods 370 50 130 120 7670 30 50 50 Wood&Prods 420 270 5 4 0 1 1 5 8 0 310 1 6 8 9 0 2 7 2 7 0 230 2 8 0 Mine Prods 3 0 3 9 0 60 2 5 3 0 910 1 0 8 9 0 2 3 0 0 S t e e l P r o d s 1 2 6 0 610 350 5 2 6 1 0 10 20 320 280 180 G l a s B r i c k 1 7 2 0 1 1 7 8 0 Misc, Hshld 4 3 2 0 120 9 6 1 0 9510 2 6 4 8 0 410 390 4 7 0 2 7 0 8 5 5 0 5 9 3 0 80 1 0 7 6 6 0 — 1 7 5 4 0 143440 2 0 8 8 0 2400 3 7 3 7 0 17570 3270 52630 5 0 0 2 1 4 7 0 8 5 6 7 0 i 8 6 0 PORT OF VANCOUVER ILWU-CMEA LONGSHORE AGREEMENT February 1,1970 - J u l y 31, 1972 26.05 CONTAINERS: Any c o n t a i n e r which i s d e s t i n e d f o r , or comes from, any person who i s not the owner of the cargo i n , or to be p l a c e d i n such c o n t a i n e r , who c o n s o l i d a t e s o r r e c e i v e s c o n s o l i d a t e d cargo which comes from or i s d e s t i n e d to any p o i n t w i t h i n the Vancouver L o c a l Area, or the P r i n c e Rupert P o r t area s h a l l be packed or unpacked, as the case may be, on the dock by persons employed under the terms and c o n d i t i o n s of t h i s C o l l e c t i v e Agreement. A l l c o n t a i n e r s o t h e r than the above s h a l l move f r e e l y to the dock a r e a and thence to the s h i p from p l a c e of o r i g i n or from the s h i p to dock a r e a and thence to d e s t i n a t i o n , as the case may be, without p a c k i n g o r unpacking by persons covered by t h i s C o l l e c t i v e Agreement. The above p r o v i s i o n s i n t h i s s e c t i o n s h a l l a p p l y i n r e s p e c t to deepsea v e s s e l c o n t a i n e r movement on l y , and the p r e s e n t Coastwise p r a c t i c e now i n e f f e c t c o n c e r n i n g c o n t a i n e r s , c r i b s and boxes s h a l l continue f o r p r e s e n t Coastwise o p e r a t i o n s . D e f i n i t i o n : The term "Vancouver L o c a l Area" s h a l l rcxsan the area between and i n c l u d i n g the o f f i c i a l Vancouver P o r t Area, E a s t to Hope and South to the U . S ./Canadian Border, p l u s the whole of Vancouver I s l a n d . Schedule 1 - Schedule of Wage Rates The c u r r e n t b a s i c s t r a i g h t time r a t e of pay as s e t f o r t h i n A r t i c l e 16 her e o f s h a l l be used when c a l c u l a t i n g the f o l l o w i n g h o u r l y pay r a t e s : (1) Graveyard S h i f t • »1 a.m. to 8 a.m. Mon. to Sun. i n c l . & H o i . 2 x S t r a i g h t Time (2) Day S h i f t 8 a.m. to 5 p«ro, Mon. to F r i . i n c l . 1 x S t r a i g h t Time Saturdays l i x S t r a i g h t Time Sun. & H o i . 2 x S t r a i g h t Time (3) N i g h t S h i f t 5 p.m. to 1 a.m. Mon. to F r i . i n c l . li? x S t r a i g h t Time Sat. , Sun., & Hoi. 2 x S t r a i g h t Time (4) S p e c i a l Coastwise S h i f t 1 p.m. to 10p.m. (5) Meal P e r i o d s Worked Noon - Mon. to F r i . i n c l . 1? x S t r a i g h t Time Saturdays 2\ x S t r a i g h t Time Sun & H o i . 3 x S t r a i g h t Time *0ther, D a i l y l | x S h i f t Rate (6) Day S h i f t E x t e n s i o n 5 p.m. to 6 p.m. Mon. to F r i . i n c l . li? x S t r a i g h t Time Saturdays 2 x S t r a i g h t Time Sun. & H o i . 3 x S t r a i g h t Time (7) Checkers & Coastwise 7 a.m. to 8 a.m. Mon. to F r i . i n c l . l i x S t r a i g h t Time Saturdays 2\ x S t r a i g h t Time Sun. & Hoi, 3 x S t r a i g h t Time Note: The r a t e ( s ) of pay a p p l i c a b l e under o t h e r s p e c i f i c c i r c u m s t a n c e s are c o n t a i n e d i n the a p p r o p r i a t e p r o v i s i o n ( s ) of t h i s Agreement. "-•Not a p p l i c a b l e f o r 5 p.m. to 6 p.m. Day S h i f t E x t e n s i o n . Schedule 2 - Table of H o u r l y Wage R&tes E f f e c t i v e E f f e c t i v e E f f e c t i v e Feb. 1/70 Feb. 1/71 Feb. l / ? 2 1 x S t r a i g h t Time $4.33 $4.78 $5.03 l i x S t r a i g h t Time 6.50 7.17 7.55 2 x S t r a i g h t Time 8.66 9.56 10.06 2 i x S t r a i g h t Time 9.74 10.76 11.32 3 x S t r a i g h t Time 12.99 14.34 15.09 Schedule 3 - D e f i n i t i o n s (1) Apron: Open areas on dock. (Not to be confused with e l e v a t o r aprons.) (2) Car: Railway f r e i g h t c a r s of any tjrpe. (3) Cargo: Goods o t h e r than m a i l , baggage ( i n c l u d i n g p assengers' automobiles) or express, f o r t r a n s p o r t by v e s s e l (express loaded or d i s c h a r g e d when longshoremen are working the v e s s e l w i l l be c n n s i d e r e d cargo). (4) Dock: A wharf, a p i e r , a f l o a t , a v e s s e l l o a d i n g or u n l o a d i n g t e r m i n a l , an anchorage. (6) L i f t - T r u c k D r i v e r : The o p e r a t o r of a l i f t - t r u c k . (?) Mechanized: The a p p l i c a t i o n of any s t a t i o n a r y or mobile machine to a cargo movement. (8) P a l l e t s A p a l l e t board of any type f o r use with spreader b a r s , spreader hooks or s l i n g s , l i f t - t r u c k s , t r a c t o r s or pump j a c k s , and to i n c l u d e c y l i n d e r p i p e s , t i l e p i p e r a c k s , food boxes, wheeled meat r a c k s ^ o l l i e s , o r any oth e r s a f e c o n t r i v a n c e f o r s u p p o r t i n g o r c o n t a i n i n g cargo. (9) P i l e : An accumulation, o r accumulations, of cargo of any d e s c r i p t i o n on or o f f p a l l e t s i n the shed of on the apron o r dock. Inward P i l e : The p i l e to which inward cargo i s taken from the stow. Outward P i l e : The p i l e , ready f o r l o a d i n g on to a v e s s e l . Source: ILWU - CMEA Longshore Agreement. February 1, 1970 - J u l y 31, 1972. P o r t o f Vancouver, B.C. DETAILED RULES ON CONTAINERS  IN THE NEW YORK SHIPPERS ASSOCIATION  INTERNATIONAL LONGSHOREMEN'S UNION AGREEMENT OF I 9 6 9 RULES ON CONTAINERS The f o l l o w i n g p r o v i s i o n s are in t e n d e d to p r o t e c t and pre s e r v e the work j u r i s d i c t i o n of longshoremen and a l l o t h e r ILA c r a f t s a t deep-sea p i e r s or t e r m i n a l s . To assure compliance v/ith the c o l l e c t i v e b a r g a i n i n g p r o v i s i o n s the f o l l o w i n g r u l e s and r e g u l a t i o n s s h a l l be a p p l i e d : Rule 1: D e f i n i t i o n s and Rule as to C o n t a i n e r s Covered S t u f f i n g - means the a c t of p l a c i n g cargo i n t o a c o n t a i n e r . S t r i p p i n g - means the a c t of removing cargo from a c o n t a i n e r . L o a d i n g - means the a c t of p l a c i n g c o n t a i n e r s aboard a v e s s e l . D i s c h a r g i n g - means the a c t of removing c o n t a i n e r s from a v e s s e l . These p r o v i s i o n s r e l a t e s o l e l y to c o n t a i n e r s meeting each and a l l o f the f o l l o w i n g c r i t e r i a : (a) C o n t a i n e r s owned or l e a s e d by employer-members ( i n c l u d i n g c o n t a i n e r s on wheels) which c o n t a i n LTL loads o r c o n s o l i d a t e d f u l l c o n t a i n e r l o a d s . (b) Such c o n t a i n e r s which come from or go to any person ( i n c l u d i n g a e o n s o l i d a t o r who s t u f f s c o n t a i n e r s o f outbound cargo or a d i s t r i b u t o r who s t r i p s c o n t a i n e r s o f inbound cargo and i n c l u d i n g a forwarder, who i s e i t h e r a e o n s o l i d a t o r o f outbound cargo or a d i s t r i b u t o r of inbound cargo) who i s not the b e n e f i c i a l owner of the cargo. (c) Such c o n t a i n e r s which come from or go to any p o i n t w i t h i n a g e o g r a p h i c a l a r e a of any p o r t i n the North A t l a n t i c D i s t r i c t d e s c r i b e d by a 50 m i l e c i r c l e with i t s r a d i u s e x t e n d i n g out from the c e n t e r of each p o r t . Rule 2i Rule of S t r i p p i n g and S t u f f i n g A p p l i e d to Such C o n t a i n e r s A c o n t a i n e r which comes w i t h i n each and a l l of the c r i t e r i a s e t f o r t h i n Rule 1 above s h a l l be s t u f f e d and s t r i p p e d by ILA longshore l a b o r . Such ILA l a b o r s h a l l be p a i d and employed a t longshore r a t e s under the terms and c o n d i t i o n s of the Ge n e r a l Cargo Agreement. Such s t u f f i n g and s t r i p p i n g s h a l l he performed on a w a t e r f r o n t f a c i l i t y , p i e r or dock. No c o n t a i n e r of cargo s h a l l >^e s t u f f e d or s t r i p p e d by ILA l o n g s h o r e l a b o r more than once. No t w i t h s t a n d i n g the above p r o v i s i o n s , LTL l o a d s or c o n s o l i d a t e d c o n t a i n e r l o a d s of m a i l , of houshold goods wi t h no o t h e r type of cargo i n the c o n t a i n e r , and of p e r s o n a l e f f e c t s of m i l i t a r y p e r s onnel s h a l l be exempt from the r u l e of s t r i p p i n g and s t u f f i n g . Rule 3» Rules on No Avoidance or E v a s i o n The above r u l e s are i n t e n d e d to be f a i r l y and r e a s o n a b l y a p p l i e d by the p a r t i e s . To o b t a i n n o n - d i s c r i m i n a t o r y and f a i r implementation of the above, the f o l l o w i n g p r i n c i p l e s s h a l l apply$ (a) Agreement i n the P o r t as to the geographic a r e a as p r o v i d e d i n Rule 1 (c) i s based on p r e s e n t LTL movement p a t t e r n s i n the p o r t . Should any person, f i r m or c o r p o r a t i o n , f o r the purpose of evading the p r o v i s i o n s of Rule 2 h e r e o f , seek to change such p a t t e r n by s h i f t i n g i t s o p e r a t i o n s t o , or commencing new o p e r a t i o n s a t , a p o i n t o u t s i d e s a i d agreed upon geographic a r e a , then e i t h e r p a r t y may r a i s e the q u e s t i o n whether s a i d p o i n t s h o u l d be i n c l u d e d w i t h i n the s a i d geographic area, and upon agreement t h a t the purpose of the s h i f t i n i t s o p e r a t i o n s was to evade the p r o v i s i o n s of Rule 2, then s a i d p o i n t s h a l l be deemed to be w i t h i n the s a i d geographic a r e a f o r the purpose of these r u l e s . (b) C o n t a i n e r s owned or l e a s e d by companies which are a f f i l i a t e d e i t h e r d i r e c t l y or through a h o l d i n g company wi t h an employer-member s h a l l be seemed to be c o n t a i n e r s owned o r l e a s e d by employer-members. A f f i l i a t i o n s h a l l i n c l u d e s u b s i d i a r i e s and/or a f f i l i a t e s which are e f f e c t i v e l y c o n t r o l l e d by the employer-member, i t s parent, or s t o c k -h o l d e r s of e i t h e r of them. (c) I t s h a l l be the o b l i g a t i o n of employer-members to c l e a r l y mark each c o n t a i n e r ' s documentation as to whether orjnot i t i s a Rule 1 c o n t a i n e r which i s to be s t u f f e d and s t r i p p e d a t the w a t e r f r o n t f a c i l i t y ( p i e r or dock). (d) Each employer-member s h a l l keep r e c o r d s of each c o n t a i n e r s u p p l i e d to a c o n s o l i d a t o r o r o t h e r non-owner of cargo, l o c a t e d v / i t h i n the agreed geographic a r e a , and such r e c o r d s h a l l be a v a i l a b l e to the Committee p r o v i d e d i n (g) below,. V/ith r e s p e c t to a l l c o n t a i n e r s r e c e i v e d a t or d e l i v e r e d from the w a t e r f r o n t f a c i l i t y ( p i e r or dock), a r e c o r d of the same w h a l l be made by ILA Checkers or C l e r k s . (e) F a i l u r e to s t u f f or s t r i p a c o n t a i n e r as r e q u i r e d under these r u l e s w i l l be c o n s d i e r e d a v i o l a t i o n of the c o n t r a c t between the p a r t i e s . Use of improper, f i c t i t i o u s or i n c o r r e c t documentation to evade the p r o v i s i o n s of Rule 2 s h a l l a l s o be c o n s i d e r e d a v i o l a t i o n of the c o n t r a c t . I f f o r any reason a c o n t a i n e r i s no l o n g e r a t the w a t e r f r o n t f a c i l i t y a t which i t should have been s t u f f e d or s t r i p p e d under the r u l e s , then the steamship c a r r i e r s h a l l pay to the j o i n t Welfare Fund l i q u i d a t e d damages of $250 per c o n t a i n e r which should have been s t u f f e d or s t r i p p e d . ( f ) I f any s h i p p e r s or t h e i r agents who have a t any time used, are now u s i n g , or i n the f u t u r e use c o n t a i n e r s owned or l e a s e d by employer-members, f o r the purpose of evading the p r o v i s i o n s of Rule 2 hereof, then the c o n t a i n e r s so used s h a l l be c o n s i d e r e d to be w i t h i n Rule 1 and Rule 2. (g) A commeittee r e p r e s e n t e d e q u a l l y by management and union s h a l l be formed and s h a l l have the r e s p o n s i b i l i t y and power to hear and pass judgment on any v i o l a t i o n s of these r u l e s . Any i n a b i l i t y to agree s h a l l be p r o c e s s e d as a g r i e v a n c e under the a p p l i c a b l e c o n t r a c t except as l i m i t e d by 3 (h) h e r e o f . (h) I f the purpose of p r o t e c t i n g and p r e s e r v i n g the p r e s e n t work j u r i s d i c t i o n of longshoremen and a l l o t h e r deep-sea ILA c r a f t s over any c o n t a i n e r s loaded with LTL cargo, or c o n s o l i d a t e d f u l l c o n t a i n e r l o a d s as d e f i n e d h e r e i n i s not accomplished by the p r o v i s i o n s of these r u l e s on c o n t a i n e r s , then e i t h e r p a r t y s h a l l have the r i g h t to r e - n e g o t i a t e these p r o v i s i o n s or any p a r t t h e r e o f by g i v i n g n o t i c e to the other p a r t y . T h i s p r o v i s i o n s h a l l not be s u b j e c t to a r b i t r a t i o n . Pending r e - n e g o t i a t i o n and s e t t l e m e n t of the g i v e n d i s p u t e , the employees may d e c l i n e to work any c o n t a i n e r s i n v o l v e d i n the d i s p u t e and such r e f u s a l to work s h a l l not be s u b j e c t to a r b i t r a t i o n . The r e - n e g o t i a t i o n r e f e r r e d to above w i l l not be s u b j e c t to a r b i t a x a t i o n . I n t e r p r e t a t i o n of t h i s p r o v i s i o n s h a l l not be determined by an a r b i t r a t o r but. by a c o u r t of competent j u r i s d i c t i o n . CONTAINER ROYALTY The r a t e of c o n t r i b u t i o n s now i n e f f e c t s h a l l c o n t i n u e . Source: C o n t a i n e r i s a t i o n I n t e r n a t i o n a l Year Book 1970 N a t i o n a l Magazine Co. L t d . London, 19^ 9 pp. 36-38. 

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