With the start of construction on the Fraser Grain Terminal (FGT), a new export facility at Fraser Surrey Docks, Parrish & Heimbecker, Limited (P&H) is now well positioned to effectively double their capacity to export Canadian grain and specialty crops to growing markets in China and South East Asia from Canada’s West Coast.
“P&H has grown substantially to support Canadian farmers and overseas customer demands,” said Casey McCawley, Vice President of West Coast Operations. “This project demonstrates our unwavering investment in the supply chain to build strong business relationships with customers around the world.” Indeed, Fraser Grain Terminal is a key part in an overall program that is seeing new inland terminals constructed as well as expansions and upgrades to existing facilities.
Parrish & Heimbecker, Limited has been a name in the grain trading business for 109 years. With their origins in flour milling and grain handling — activities that are still done today — the company has grown to encompass over 1,500 employees, 60+ locations across Canada and a well-established network of trade links around the world. “We’re in the grain transportation business,” said McCawley. “P&H is committed to investing in assets that move grain from the farmgate to end users around the globe as efficiently as possible. While grain transportation is one aspect of P&H, we are diversified within the agriculture sector and in addition to being the largest Canadian-owned milling company, we’re growing our farm inputs, feed manufacturing and pea processing businesses,” added McCawley. On the West Coast, P&H is partnered with Paterson Global Foods and Northwest Terminals of Unity Saskatchewan in the Alliance Grain Terminal on the south shore of Burrard Inlet. They also have a container stuffing business in Cloverdale. Along with P&H’s current operations at Fraser Surrey Docks (FSD), P&H’s current combined capacity, stands at roughly over three million tonnes. This includes the gains seen from a recent $55 million investment at AGT for a new shiploader and gallery upgrade that was completed last fall (for more on this, see BC Shipping News’ interview with David Kushnier, CEO of AGT on Page 23).
As for the current facility operating as a joint venture with FSD for the past six years, McCawley explained that the original business plan was for a flat storage shed to handle canola meal and distiller dried grains. While planned throughput was for 250,000 tonnes per annum with a capacity of up to 500,000 tonnes, “we actually did over one million tonnes in 2017/18 because we needed the extra grain capacity,” he said, adding that even after the new facility is up and running, the existing flat storage system will continue to handle proteins like canola meal and others that don’t handle well through conventional silo storage systems.
Once completed in late 2020/early 2021, the new facility will be used to ship bulk grain products including wheat, barley, oil seeds, pulses and other specialty grains. The throughput of 3.5 million tonnes per annum (Mt/a) will bring the total capacity for the Fraser Surrey site to four Mt/a with the 0.5Mt/a from the existing joint venture facility.
The new facility will have a modern design that minimizes noise and dust from grain handling operations and will replace an aging and obsolete manufacturing warehouse on vacant port land that has not been used for several years. The main construction projects for the terminal include:
- A rail unloading station;
- A transfer system comprising one transfer tower and fully enclosed above-ground conveying equipment with a built-in dust suppression system;
- Twenty-five above-ground steel storage silos;
- Three shiploaders which will be shared between the existing facility and the new terminal, replacing the existing portable shiploader;
- A semi-loop rail track;
- Realignment of an existing rail track;
- Extension to three existing rail holding tracks in an area to the north east of the main grain facility site to reduce shunting during unloading;
- Construction of an integrated truck and railcar loading facility and container loading facility with associated container storage yard; and
- Construction of ancillary buildings — administration building, maintenance shop, and electrical rooms.
The terminal will load approximately 80 bulk vessels per year (about one to three vessels per week), including Panamax, Supramax and Handy-size ships. While most vessels will be fully loaded at the Fraser Grain Terminal facility, larger class Panamax vessels will be loaded to the maximum capacity according to guidelines for the river draft of 11.6 metres and may be topped up at a deep-water terminal. With its integrated container loading component, FGT will be the only container loading facility in the Lower Mainland able to unload unit trains. To add to its efficiency, FGT’s location on the South Fraser Perimeter Road allows convenient access to Deltaport, Canada’s largest container terminal for product not destined for bulk vessels.
P&H is working with several container shipping lines to incorporate the new terminal as an off-dock location to position inbound containers to be filled with grain for export. Containers will be trucked to container export terminals, like Deltaport but McCawley’s vision for the future also includes investment in short sea shipping to utilize FGT’s location on the Fraser River. “We could provide an economical, efficient alternative that also produces less emissions than high volumes of truck movements on congested Lower Mainland roads.” A small amount of product will be destined for distribution to customers in the Fraser Valley as well.
Getting to yes
As any applicant of a capital project can attest, the permitting process in Canada is extensive and robust to say the least. McCawley suggested a similar experience in getting approval for FGT. “It took two and a half years,” he said, “during which we completed 310 studies and a rigorous public consultation that included 14 First Nations.”
While overall feedback was positive and McCawley and his team took a direct, transparent approach to ensuring all questions received answers and all issues were identified and addressed, one snag in the process came when a small design change to the silos mid-way through the process required a repeat of the consultation process. “It was very time consuming, but we took it very seriously and I believe the community and stakeholders appreciated our efforts,” he said. McCawley developed a renewed appreciation for the history of the Fraser River and its importance to Indigenous communities.
Key to the location for FGT and for P&H’s overall logistics chain is ensuring rail capacity that can support terminal throughput. “The FGT site is serviced by CN, CP, BNSF and SRY railways. The value proposition for P&H is industry-leading car cycle times from prairie to port without having to make a lot of infrastructure investments to alleviate some of the bottlenecks you see getting to both the south and north shores of Vancouver Harbour,” McCawley said, adding that at some point, he would like to see CP being able to deliver directly to the terminal for increased efficiencies. “Right now, it is working fine but we do see efficiencies that can be gained once volumes start to increase.”
Meeting and exceeding capacity
While the terminal is under construction, P&H has laid out a multi-year plan that involves new builds and expansion of existing inland facilities. “We recently opened up a new grain terminal and crop input centre in Viking, Alberta,” McCawley said. “It has a 46,000-tonne grain storage elevator, a 25,000-tonne dry bulk fertilizer shed and is all attached by a CN 150-car loop track. We also just announced another new terminal and crop input centre to be built in Gilbert Plains, Manitoba.”
In addition to these, McCawley announced a recent partnership agreement between P&H and GrainsConnect Canada, a joint venture between Australia’s GrainCorp and Japan’s Zen-Noh Grain Corporation. Under the agreement (which is still subject to regulatory approval at the time of writing), FGT will become a 50-50 joint venture. “Together, we’ll be at full capacity at the terminal quite quickly,” he said.
That led to the question of future expansion and McCawley said there were opportunities to improve on things like rail access — for example, constructing overpasses to allow for longer trains — as well as operational efficiencies, but with Fraser Surrey Docks currently for sale (excluding FGT and the joint venture) no definitive plans have been made yet.
For now, McCawley is excited about the investments being made to ensure P&H’s growth on the West Coast.