The Future for Mega Bulk Terminals

The Future for Mega Bulk Terminals

Joel Shirriff, P Eng, Vice President, Global Practice Lead Terminals and Transportation, Ausenco, Vancouver, Canada

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The world is currently experiencing a noticeable recovery in the petroleum and mineral resources sectors after suffering a major downturn for the last two years. This downturn saw market prices for nearly every resource commodity sink to such low levels that production was curtailed to minimal levels by many companies as they struggled to stay in business. 

This had a ripple effect on the downstream export logistics networks, as the reduced output resulted in excess capacity at the existing bulk terminals, and even halted planned expansions at some facilities. The largest impact in this area was seen in the coal sector, as both thermal and metallurgical (steel making) coal prices fell dramatically, and the throughput at the dedicated mega terminals for coal shrank to match mine production rates. 

On average, coal production dropped approximately 40% in cash value and 10% by weight from peak 2012 levels, equating to more than 80 million tonnes per year (Mt/y) of excess capacity at the mega coal terminals around the world.

The opposite approach was taken in the iron ore sector, where output was actually increased in an effort to reduce production costs. This kept the iron ore mega terminals in Western Australia and Brazil busy, but also had the effect of further depressing iron ore commodity prices and drove many smaller producers to shut their operations, and halted development of new resources around the world. This is reflected in the global rates for usable iron ore production which peaked in 2014 at 2,330Mt/y, but fell only 4.5% over 2 years to 2,230 Mt/y in 2016.


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