One of the province’s largest chambers of commerce, the Burnaby Board of Trade, is calling on the federal government to address the soaring cost of container shipping, which has risen by over 400% in the past several months, putting small businesses and the economic recovery at risk.
In a letter to Transport Minister Omar Alghabra and Transport Canada officials, the business association representing 1,100 companies across the Lower Mainland is asking the government to play a more active role in addressing this issue with an investigation into the causes of the inflationary increases to shipping costs, a possible support fund for small businesses impacted, and expedited expansions to both technology and capacity at local port facilities.
Businesses across sectors are experiencing skyrocketing prices for container shipping, with prices having increased many multiples this year alone as supply chains struggle with the impacts the COVID-19 pandemic has had on manufacturing, consumer behaviour, and supply chains.
Some local businesses are even reporting that shippers are unable to even provide price quotes, forcing importers and exporters to accept a market price sight-unseen in order to secure container space. This situation is hurting local businesses’ ability to compete, to take advantage of market opportunity, and is directly and negatively impacting their bottom-lines.
“Just as businesses are starting to see the light at the end of the tunnel after the pandemic, they are now being faced with shocking shipping costs to get products into or out of Canada,” says Paul Holden, President & CEO of the Burnaby Board of Trade. “We understand this is a complex, globally-connected sector, but the challenge is no less acute for our business community and deserves no less attention from government,” added Holden.
Of particular concern to the board of trade is the impact of escalating prices on business cash flow. The speed and scale of the increases to shipping costs has made it nearly impossible for businesses to set appropriate prices for their goods, or to accurately bid on contracts, and as a result, businesses face the real risk of actually losing money on sales or jobs, posing a credible risk to the viability of businesses with limited cash flow, credit or capital.
The Burnaby Board of Trade is calling on Transport Canada and the federal government to commit to 5 actions:
- Investigating the inflationary pressures and accessibility challenges facing shipping in Canada and ensuring our shipping systems are working effectively to meet the needs of business
- Working with the industry to develop, and then share with all businesses, a forecast for pricing to assist businesses in future planning and budgeting
- Explore creating a funding mechanism to support small and medium businesses which have been exposed to this significant cost inflation and may face undue financial pressures as a result
- Work with the Vancouver Fraser Port Authority to implement innovations and technologies which can foster a better understanding of local and international supply chains and identify ways of maximizing our trade infrastructure efficiency
- Expediting assessments of current and future port capacity, and supporting increases to our trade infrastructure capacity through projects such as the Roberts Bank Terminal 2 project
