They state that because containerships travel at high speeds and are nearly always in motion except for loading and discharging cargo, they are very sensitive to fuel prices. In 2000 when oil was $20 per barrel, it cost $3000 to ship a 40-foot container from Shanghai to the U.S. East Coast.  Today (in May with oil at $130 per barrel) it costs about $8000 including inland transportation to ship the same container. At $200 per barrel those cost would be $15,000.

 

The economists claim this is having an impact in capital intensive manufacturing whose products carry a high ratio of freight costs to the final selling price.  An example is steel. It requires only 1.5 hours of labor per ton and is seeing changes in trade patterns with Chinese steel exports to the U.S. down 20 percent while U.S. production is up 10 percent.  This trend may help countries close to the U.S., like Mexico.

 

They wrote that "American importers are starting to do the math and are already shifting some business from China to Mexico". The goods that have seen the fastest growth, they point out, are ones that are more freight-intensive and directly compete with China, such as furniture, iron and steel, rubber and paper products.

The U.S.-Flag Great Lakes fleet moved 11.9 million tons of dry bulk cargo in May, a two percent decrease compared to a year ago. The lack of dredging continues to have a significant impact. The largest vessels are still losing 6,000 tons or more each trip because of the dredging crisis.

 

The rising water level on Lake Superior, home to five of the six U.S. iron ore loading ports, also helped the trade in May. The months's top loads were about 1,200 tons more than a year ago. The dredging crisis however, still has an impact. The largest vessels could have carried another 5,000-6,000 tons on each trip if the money was made available for the Corps of Engineers to restore the Great Lakes navigation system to project dimensions. With rapid water level fluctuations possible, more dredging is the only way to guarantee maximum vessel capacity.

 

Lakes Limestone Trade Down

Limestone shipments on the Great Lakes totaled 4.2 million net tons in May, a decrease of 3.4 percent compared to one year ago.  May stone cargos were nearly 11 percent off the month's five-year average. Demand is sluggish in some markets but the dredging crisis continues to limit deliveries. For example, one vessel lost 15,000 tons of stone in just three trips because of having to light load. For the year, the limestone trade on the Great Lakes is 7.4 million net tons, a decrease of nearly 6.7 percent compared to this time last year. Shipments are more than 14 percent behind the five-year average for the January-May timeframe.

 

Lakes Fleet at Full Strength

Essar Announces new Minnesota Steel Plant

 

 

U.S. Steel importers will use the Doha Round of multilateral trade negotiations to seek changes in U.S. anti-dumping and countervailing duty practices.  The American Institute for International Steel (AIIS) says recent Commerce Department rulings, such as 505 percent countervailing duty against an Indian maker of hot-rolled sheet, and combined anti-dumping and countervailing duty rates of 701 percent against a Chinese pipe producer, are "protectionist and absurd." AIIS wants U.S. anti-dumping and countervailing duties to expire after five years.

 

The Great Lakes Water Resources Compact has passed the legislatures in all eight Great Lakes states.  The Compact was signed by the Governor of Ohio in late June making Ohio the sixth state to pass the Compact. As part of the approval in Ohio, Ohio voters will decided a State constitutional amendment in November that bars the Compact from affecting ground water ownership. The Compact will be in force, even if the constitutional amendment does not pass. The Governor of Pennsylvania signed July 4 and the Governor of Michigan signed July 9. 

 

In a recent editorial, The Morning Journal in Lorain, Ohio, also suggested that water could become a driving force to bring business, jobs and residents back to the Great Lakes region from areas of the country that lack water.

 

The Compact is designed to protect the Great Lakes and to prohibit future diversions of Great Lakes water outside the basin. It ensures that each Great Lakes state will be have the same protections while allowing each state the flexibility to manage its own water use. The Compact was signed by all eight Great Lakes Governors and two Canadian premiers in 2005 following five years of negotiations.

 

Toledo Blade, June 6, Ceremony will mark launch, 50 years ago, of Edmund Fitzgerald 

Toledo Free Press, June 6, Special Report: Local sailors remember Toledo port during Fitzgerald's heyday
Niagara Gazette,  June 9, Lake Ontario: Water levels topic of meeting today
The Sault Star,  June 10, Algoma Center renames ship after Sault's Dool
Duluth News Tribune, June 12, Taconite shipments up, limestone down
Dayton Daily News, June 15, Ohio taking steps to protect Great Lakes
Toledo Blade, June 15, Great Lakes accord must still navigate rough waters
Business North, June 15, Lake Superior levels get hearing at Duluth Depot
Hamilton Spectator, June 17, Port peers into its future
Milwaukee Journal, June 17, Boats, words collide in dispute between marina and skipper
The Chronicle Journal, Thunder Bay, June 18, Do water levels matter?
Thunder Bay's Source, June 17, Report on Great Lakes water study Tuesday
Northwest Indiana Times, June 19, Mississippi flooding delaying barge traffic for port
Chicago Sun-Times, June 20, New Fish disease threatens to spread

Superior Telegram, June 20, County: Shippers can fund invasive species cleanup
RedOrbit, Dallas, Texas, June 22, Researchers test bleach, vitamin C for ballast cleanup
Toledo Blade, June 23, Port Huron ship-shape for visit

Youngstown Vindicator, June 29, Great Lakes Compact nears overdue ratification by states