With the lowest cargo volume in 71 years for iron ore and the worst in 77 years for coal, the two chief backbones of U.S. Great Lakes shipping, fleet leaders are expecting better shipping in 2010 – but only mildly better.
The third biggest item for Great Lakes shipping, limestone, was down to its lowest level in 25 years, since the recession year of 1984, to 23.5 million net tons.
Iron ore shipments of just 31.8 million net tons, were at the lowest level recorded since 1938, when lakers carried 21.6 million tons, the Cleveland-based Lake Carriers’ Association said today.
Coal for the steel and power plants of the Great Lakes basin fell 25 percent from last year to 29.9 million tons, its lowest figure since 1932.
With only a few small commodities still to report next week, U.S. lakers will have carried about 35 percent less cargo overall than in 2008, LCA vice-president Glen Nekvasil told The Journal of Commerce.
Nekvasil says collapsed demand from steel plants of the United States and Canada started to come back late last year but they still have about 30 percent of their capacity idle.
“We need the U.S. consumer to start buying steel products again,” Mark Barker, president of Interlake Steamship Co., a prominent U.S. lake carrier, said in an interview.
“We are tied principally to iron ore, coal and stone,” he said. “Demand for iron ore grew in the U.S. and Canada in the later months, and I think recovery this year likely will stay steady at the current rates.”
“I think stone will continue to be weak and that coal will be steady at about the current rather poor levels.”
“We ended the year a little better than we began it, but we need a turn-around in the economy to do better.”
Seven of the 55 vessels comprising the U.S. fleet did not sail in 2009, including two of Barker’s big vessels, and several sailed for very short periods, all for lack of business.
The World Steel Association forecasts only a moderate 9.2 percent return in world steel demand in 2010, much more in China and India than in North America. And Joseph Carrabba, chief of Cleveland-based Cliffs Natural Resources, a major mining company, says, “We are going to be pretty cautious going into the first half of 2010.” He does, however, expect to sell more North American iron ore than the 17.4 million tons in 2009.