If you look at a map on the US and look to the north you see blue or a waterway from the Atlantic Ocean to Buffalo across to Cleveland over to Chicago and up to Duluth and it is easy to see both great history and economic activity connected to the Great Lakes. Great American cities were form and expanded because of the movement of goods and services on the waterways. Many of us take the movement of goods on the waterways as normal or we do not give much thought to it.
In an article by Nicolas Van Praet and Eric Atkins of the Globe and Mail, the levels of the St. Lawrence River is lower than normal. The levels have dropped even though the water in the Great Lakes is monitored and controlled by the International Joint Commission, the primary source of water for the St. Lawrence River is Lake Ontario and according to the International Lake Ontario-St. Lawrence River Board, Lake Ontario has seen its driest conditions since 1966. The reason is as much as we in the north east like and dislike snow, the snow and the important snow melt is down meaning less water is flowing into the Lakes.
The lower levels in the St. Lawrence means ships carrying goods have to lightened or carry less goods or do more trips. The formula is each reduction of 10 centimetres of water represents about 3,000 metric tonnes that has to be removed. More trips mean higher fees. If you think about the ship which caused the blockage in the Suez Canal earlier this year, it was a massive ship moving containers, to keep up with the demand of moving containers.
Linking to dividend paying stocks, climate change affects logistics which affects the supply system which affects prices. When climate changes the normal, alternatives need to be found and alternatives always mean extra time and effort and higher fees. The alternatives are trains and trucks, but the cost is higher.
There are more questions than answers, till the next time – to raising questions.