Iron Ore Shipment Rates During Transition to Self-Unloaders

[Guest]

The US Geological Survey has a compendium of iron ore shipments data from the Lake Superior District, along with global data in various tables.

In table 5 you can see how direct-shipping iron ore declined starting around 1957: https://d9-wret.s3.us-west-2.amazonaws. ... s/tbl5.txt

And a link to all the tables that the USGS provides: https://www.usgs.gov/centers/national-m ... m#iron-ore

[guest]

With the rise of the self unloaders in the late 70s to early 80s, I believe the rates dropped dramatically. The old rates were set in terms of "over the rail", for example in Cleveland. So, to use an example, what the George M. Humphrey carried there 24K was several thousand tons less than the Joseph L. Block carries 30K+, arriving at CBT Sunday. So the big difference is the dock side crew. The old C&P probably had 70 to 80 employees and they had to cover two or maybe three shifts. I understand CBT has about 8 employees now. The railroad people also lost there jobs, because of the shuttle vessel delivery up the Cuyahoga river. Another example, the ore dock in Huron had been quite busy in the late 70s before the demise of the US steel industry. A story was told about a "water boy", yes someone brining water to the rig operators, making 40K a year due to overtime and a very god business. Sadly the ore dock in Huron is no more because Wheeling Pittsburg steel company it delivered to went bankrupt.

[GuestfromEU]

These are good questions and I hope somebody with more knowledge than I can respond.

What I can contribute is to say the majority of cargo on the Great Lakes (domestic within Canada and USA, not imports) is carried under a contract of affreightment. Essentially this means the shipping company commits to move X amount of cargo for customer Y to their designated ports, which are often named in the charter (contract). The shipper and end receiver do not necessarily care which ship carries their cargo, unless specific ship(s) are designated, often due to vessel size restrictions for the berth or harbour. In reality, while the 1000 foot ships are more economical in ton/mile values compared to smaller or older ships, the shipowner also must consider cargo availability, vessel position, competing traffic, and customer requests (i.e. they call to say they are running out of material). This is where the operations team at the shipowner shows their skills by adjusting schedules to maximize available vessels, combined with a range of other factors, vessel positioning for following cargos, etc. This side of the industry is something I am not greatly familiar with so I defer to others who have more knowledge.

Short summary: While self unloaders have higher operating expenses due to maintenance of additional equipment, the shipowner is paid for moving cargo regardless of the type of vessel used. The rates for moving cargo are set in charter negotiations, with consideration by the shipowner of the type of vessels used.

[Guest]

When the movement of iron ore shifted from straight deck bulk carriers to self-unloaders beginning during the early 1970s to early 1980s did this increase the rates of moving taconite in light of the increased expenditure by the various US fleets that converted many vessels to self-unloaders along with the construction of several more new vessels of that category? Although the speed at which a ship could unload itself increased the number of trips it could make during a season, it seems likely the maintenance and reduced carrying capacity incurred by the unloading gear would have increased the operating costs for the shipping companies. This was likely less important to vertically integrated fleets like USS, Bethlehem, Inland, etc. but how did this affect fleets like Interlake and Oglebay Norton (in particular the ore carriers of the latter company)? Did the increased flexibility and efficiency offset the costs of having onboard unloading gear or did demand itself drive the fleets to invest in this technology? I understand that by the mid-1980s, straight deckers had basically disappeared from the US fleet with only a handful left as gearless bulk carriers could not compete with self-unloading vessels. That being said, was this transition also fueled by increased competition and the lofty estimates of future seasonal ore tonnage movements predicted during the early 1970s that later evaporated with the downsizing of the steel industry during the early 1980s?