SIC 4432
FREIGHT TRANSPORTATION ON THE GREAT LAKES-ST. LAWRENCE SEAWAY



This category covers establishments primarily engaged in the transportation of freight on the Great Lakes and the St. Lawrence Seaway, either between U.S. ports or between U.S. and Canadian ports.

NAICS Code(s)

483113 (Coastal and Great Lakes Freight Transportation)

Industry Snapshot

In late 2002, the U.S. Flag Great Lakes Fleet consisted of 67 vessels, 58 of which were in active service. According to the Lake Carriers' Association, the active fleet included 48 dry-bulk carriers, six tankers, and four cement carriers. In addition to engaging in the transportation of domestic freight on the Great Lakes and upper St. Lawrence River, these ships also carried freight between U.S. and Canadian ports. Federal cabotage laws required that cargo shipped between U.S. ports be carried in ships built and registered in the United States and owned and crewed by U.S. citizens. Ships of other maritime nations also sailed the Great Lakes-St. Lawrence Seaway. Any U.S. flagged ships involved in international trade other than to Canadian ports would be classified elsewhere. According to the U.S. Coast Guard, in recent years an estimated 500,000 private sector jobs were dependent on Great Lakes commercial shipping. The Maritime Association placed actual shipboard jobs in the Great Lakes at about 1,300.

The principal cargoes shipped on the Great Lakes-St. Lawrence Seaway are iron ore and coal. Freighters carry iron ore mined in Minnesota and Michigan to steel mills in Illinois, Indiana, Michigan, and Ohio. A single Great Lakes freighter can carry enough iron ore to produce the steel needed to build 87,000 automobiles. The second-largest cargo is coal, mined primarily in West Virginia, Kentucky, Pennsylvania, Ohio, and Illinois, and shipped to utilities and factories in the upper Great Lakes states and Canada. Great Lakes freighters also carry low-sulfur Western coal shipped initially by rail to Superior, Wisconsin. The U.S. fleet typically hauls millions of tons of cargo annually during a nine-month navigation season. The principal cargoes of foreign transporters are wheat, barley, corn, and other grains from the Midwest and Canada that are destined primarily for European markets. In 2002, dry-bulk cargo shipments via the Great Lakes amounted to 162.3 million net tons, down from 164.6 million in 2001 and 176.3 million in 2000.

Nearly all of the U.S. flag ships engaged in freight transportation on the Great Lakes are members of the Lake Carriers' Association, founded in 1880 and one of the oldest active trade organizations in the United States. The Cleveland-based organization lists 14 members who owned 63 vessels. This includes two steel companies that operate ore carriers. The fleet includes 60 dry-bulk carriers and three double-hulled tankers. Their collective cargo capacity is more than 1.8 million tons.

Background and Development

The Great Lakes constitute the single largest body of fresh water in the world, covering more than 95,000 square miles. Lake Superior alone covers 31,700 square miles, making it the world's largest freshwater lake. With their connecting waterways, the five Great Lakes—Superior, Michigan, Huron, Erie, and Ontario—also constitute the world's largest inland water transportation system. Eleven hundred miles separate Duluth, Minnesota, the westernmost point of Lake Superior, from the St. Lawrence River, which stretches another 800 miles to Quebec, where it empties into the long, narrow Gulf of St. Lawrence. This waterway provides access for the transport of goods from the heart of the Midwest directly to the Atlantic Ocean.

This massive, interconnected waterway has been an important trade route for more than three centuries. As early as 1660, French explorers were transporting furs by canoe from the upper reaches of Lake Superior to Quebec on the St. Lawrence River. In 1679, the explorer Sieur de La Salle built the Griffin, the first commercial vessel on the Great Lakes. Built and launched above the falls on the Niagara River, which connects Lake Ontario and Lake Erie, the Griffin was also the first ship to sail on the upper Great Lakes.

La Salle sailed the Griffin to Green Bay, then a French outpost on the western shores of Lake Michigan, where it was loaded with furs. The five-man crew of the Griffin then set out on the return trip, while La Salle headed south to explore the Illinois River. The Griffin never survived its maiden voyage, however, as it was apparently lost during a violent storm. Father Louis Hennepin, who sailed with La Salle, later wrote an account that suggested the Griffin foundered on Lake Dauphin, the French name for Lake Michigan. In 1890, a lighthouse keeper discovered seventeenth-century artifacts and four skeletons in a cave on Manitoulin Island in Lake Huron, but the Griffin and the chest of gold coins it reportedly carried were never found.

Struggle for Control. The next ships to sail the Great Lakes after the ill-fated Griffin were warships built on Lake Ontario in the years leading up to the French and Indian War, in which France and England struggled for control of the profitable North American fur trade. The first naval battle fought on the Great Lakes took place in 1756, and the English commander fled without firing a shot. However, British forces eventually captured Quebec and Montreal, the two most important French settlements. In 1763, France ceded Canada and most of its possessions east of the Mississippi River to Great Britain. The English established a shipyard at Navy Island on the Niagara River and built the first commercial ships to sail the upper Great Lakes since the Griffin.

In 1783, following the Revolutionary War, the Treaty of Paris established the Great Lakes as the boundary between the United States and Canada, with the exception of Lake Michigan, which was entirely in U.S. territory. However, the Great Lakes remained the "English Seas" until Oliver Hazard Perry defeated the British fleet in the Battle of Lake Erie during the War of 1812. The Battle of Lake Erie was the last naval engagement fought on the Great Lakes. Neither the United States nor Canada now maintains warships or fortifications on the lakes. Although the international boundary runs down the middle of the lakes, the two countries have granted admiralty and criminal jurisdiction to each other covering the entirety of the Great Lakes.

Canals Expand Great Lakes Trade. The Great Lakes and the St. Lawrence River were always connected by natural waterways, but not all of those waterways were navigable. Fur traders were able to portage around the spectacular falls on the Niagara River or the much smaller falls on the Saint Mary's River, which linked Lake Superior with Lake Huron. But larger ships of commerce were unable to sail the entire stretch of the Great Lakes or navigate the Lachine Rapids on the upper St. Lawrence River.

The Erie Canal, completed in 1825, was the first navigable waterway to link the Great Lakes with the Atlantic Ocean. It connected the city of Buffalo, at the eastern edge of Lake Erie, to Albany, 363 miles away. From there, ships were able to reach the harbor at New York by sailing down the Hudson River. The St. Clair became the first ship to travel all the way from Detroit to the Atlantic, lowering its masts at Buffalo so it would fit under the bridges as it was towed down the canal by mules.

With the opening of the Erie Canal, the cost of transporting freight from Lake Erie to New York fell from $120 a ton to $4 a ton. Several other canals were also dug in the early nineteenth century, linking other inland waterways with the Great Lakes. The Ohio-Erie Canal, also opened in 1825, ran from Cleveland to Akron, Ohio, and then followed the Scioto River to the Ohio River. The Miami-Erie Canal linked the Great Toledo with the bustling Ohio River port at Cincinnati. The Illinois and Michigan Canal, completed in 1848, is often called the single most important factor in the development of the state of Illinois. It linked the growing port at Chicago with the Mississippi River.

In 1829, a Canadian company opened the Welland Ship Canal, which further encouraged trade on the Great Lakes by making it possible to sail between Lake Erie and Lake Ontario. The original canal linked Lake Ontario with the Welland River, which flowed into the Niagara River above the falls. A laborious system of 40 locks lifted and lowered the ships. In 1833, the canal was extended from Port Robinson on the Welland River to Port Colborne on Lake Erie, entirely bypassing the 25-mile-long Niagara River. Canal reconstruction conducted between 1873 and 1887 reduced the number of locks to 25; a new canal completed in 1932 further reduced the number of locks to eight.

The opening of the Welland Canal left only Lake Superior cut off from the rest of the Great Lakes, since the 42-mile-long Saint Mary's River contained several stretches of rapids and a 19-foot waterfall. In 1668, French trappers established a portage and trading post on the river at the city of Sault Sainte Marie. Then in 1797, the Northwest Fur Company, an English enterprise, built a single-lock canal around the falls, which allowed canoes and flat-bottomed boats to navigate the river. However, the canal was destroyed by American troops during the War of 1812. In 1850, John Jacob Aster's American Fur Company built a tramway to carry cargo between Lake Huron and Lake Superior, but the need remained for a navigable waterway. With the growing importance of Lake Superior trade, entire ships were sometimes dragged between the lakes on wooden rollers.

Soon after Michigan became a state in 1837, Governor Stevens T. Mason announced plans to build a canal on the American side of the Saint Mary's Falls. However, the proposed canal would have crossed the Fort Brady military reservation, and a detachment of U.S. soldiers stopped the project less than a week after it was started. Michigan then began lobbying Congress for permission and a federal grant to build the canal. For years the request went nowhere, reportedly blocked by Henry Clay, the powerful senator from Kentucky, who declared Lake Superior "beyond the farthest bounds of civilization, if not the moon."

Sentiment changed dramatically after 1844, when William Burt, a deputy U.S. government surveyor, accidentally discovered vast amounts of iron ore along the shores of Lake Superior. Jacob Houghton, a member of the surveying team, later wrote, "As we looked at the [compass], to our astonishment, the north end of the needle was traversing a few degrees to the south of west. Mr. Burt called out, 'Boys, look around and see what you can find.' We all left the line, some going to the east, some going to the west, and all of us returned with specimens of iron ore, mostly garnered from outcrops."

In his first State of the Union Address in 1851, President Millard Fillmore told Congress that a canal bypassing the Saint Mary's Falls "would be national in its purpose and benefits." In 1852, Congress granted Michigan a 400-foot right-of-way across the Fort Brady reservation. It also donated 750,000 acres of federally owned land in Michigan to pay for the project. In 1853, the Saint Mary's Falls Ship Canal Company broke ground on what would become the first of the Soo Locks.

The Saint Mary's Canal was completed in July of 1855. The brig Columbia, with six barrels of ore from the iron range at Marquette, became the first vessel to pass through the locks and sail down the river onto Lake Huron. More than 14,000 tons of ore were carried through the canal in 1856, the first full year of operation. That figure had risen to more than 153,000 tons by 1861, in time to play a major role in providing munitions for the North during the Civil War. In 1876, more than a million tons of iron ore, copper, grain, and other cargo passed through the canal, which by then had been expanded with a second lock to handle larger ships. In 1881, Michigan relinquished control of the canal to the federal government. The Canadian government opened the Sault Sainte Marie Canal on its side of the river in 1895. In 1900, 19 million tons of iron ore were shipped from the Great Lakes. By 1905, the tonnage had nearly doubled to 37 million tons. In 1855, the cost of hauling iron ore was $3 a ton; by 1900, it was 60 cents.

A second canal was built on the U.S. side of the Saint Mary's River in the early 1900s, and the twin Davis and Sabin Locks were opened. The original South canal was expanded in 1943 with the MacArthur Lock. The largest of the Soo Locks, the 1,200-foot Poe, was opened on the South canal in 1969. The Soo Locks have been called the single most important development in the Great Lakes shipping industry. Each new lock was bigger than the last and gave rise to bigger and wider freighters.

Great Lakes Freighters. Although steamships made their appearance on the Great Lakes in 1816, they were primarily engaged in passenger service or package delivery. A few masted steamers were used as cargo carriers in the mid-1800s, but nearly all freight was carried in wooden sailing ships. The most common freighters were known as Great Lakes schooners and were characterized by long, narrow beams. By one account, there were more than 1,700 schooners plying the Great Lakes in the 1870s, carrying grain, lumber, coal, and iron ore. The last full-rigged schooner ever built on the Great Lakes was the Cora A, launched in 1889 at Manitowoc, Wisconsin.

In the 1880s, however, shipbuilders began turning to steam and steel. The first Great Lakes freighter to be built of iron was the Onoko, launched in 1882. The Onoko was 300-feet in length, had a vast unobstructed cargo space, and could carry up to 3,000 tons. The Onoko, which operated for 33 years before being lost on Lake Superior, became the prototype for hundreds of Great Lakes freighters that would follow. Most freighters mimicked the Onoko's long, low-riding cargo hold with a forecastle for crew and bridge and a housing at the stern for the engines.

The earlier Poe Lock, which opened on the Saint Mary's River in 1896, could handle ships with twice the cargo capacity of the Onoko, and the Great Lakes shipping industry was quick to take advantage. The 412-foot Sir Henry Bessemer, with a capacity of 6,700 tons, was launched the same year the lock opened. The 454-foot Malietoa, launched in 1889, could carry 7,500 tons, a record that lasted until the 540-foot Augustus B. Wolvin took on 10,500 tons in 1904. More than 100 freighters the size of the Wolvin were launched in the first decade of the twentieth century, but even those giant ships were outclassed by 600-foot freighters with 15,000-ton capacities when the Davis and Sabin Locks opened in 1914 and 1919, respectively.

The first freighter to carry 20,000 tons was the Wilfred S. Sykes, launched in 1949, following completion of the MacArthur Lock. The Sykes, owned by the Inland Steel Corporation and still in operation in 1993, was nearly 700 feet long and 70 feet wide and had a draft of 37 feet. The largest of the U.S. locks, also named Poe for the one it replaced, was dedicated in 1969 and opened the way for the latest generation of Great Lakes freighters—1,000-foot supercarriers capable of taking on loads of 60,000 tons or more.

St. Lawrence Seaway. The St. Lawrence River is the second longest river in Canada. It flows northeast from its headwaters at the eastern end of Lake Ontario to the Bay of St. Lawrence, 800 miles away. Part of the river forms the boundary between the province of Quebec and New York State. Navigating the lower St. Lawrence, from Montreal to Quebec, was always relatively easy. However, between Lake Ontario and Montreal, the upper St. Lawrence drops from 245 feet above sea level to 20 feet in a series of rapids, making access difficult.

In 1895, Canada and the United States began discussing the possibility of deepening the upper St. Lawrence and constructing a series of locks to open the river to international trade. In 1929, the International Joint Commission, established 20 years earlier to administer the boundary waters, recommended a combined navigation and power-generation project. In 1932, Canada and the United States signed the St. Lawrence Deep Waterway Treaty, which called for building a 27-foot-deep waterway between Lake Erie and Montreal, plus the construction of four hydroelectric plants. Several commercial interests opposed the project, including the railroads and coal companies, and the U.S. Senate rejected the treaty in 1934.

In 1941, the war in Europe revived interest in the proposed seaway, and the two countries signed the Great Lakes-St. Lawrence Basin Agreement, which added a power plant at Niagara Falls to the original proposal. The proposal still needed Congressional approval, but when the United States entered World War II a few months later, the issue was set aside. In 1942, power shortages in Ontario and New York delayed production of war materials, and President Franklin D. Roosevelt considered an executive order to begin the St. Lawrence project. He dropped the idea because it would take at least three years to bring the first power plant on line. The proposal languished in Congress until 1951, when Canada announced plans to proceed on its own. Congress then began serious discussions and approved U.S. participation in the project in 1954.

The St. Lawrence Seaway opened officially on June 26, 1959. Parts of the seaway lie entirely within Canada, whereas other sections lie within the United States. Although the St. Lawrence Seaway opened the Great Lakes to international trade, Great Lakes freighters and most ocean-going vessels built after 1970 were too large to use the locks.

The Dangers of Great Lakes Shipping. Hundreds of ships and thousands of lives have been lost during violent storms on the Great Lakes. As Jacques Marquette, one of the first white men to explore the region, wrote in the seventeenth century, "The winds from the Lake of the Illinois no sooner subside than they are hurled back by the Lake of the Hurons, and those from Lake Superior are the fiercest of all. In the winter months there is a succession of storms; and with these mighty waters all about us, we seem to be living in the heart of a hurricane." In one terrible storm alone, in November 1913, more than 235 sailors were killed and 10 Great Lakes freighters lost. But the most famous shipwreck in Great Lakes history was the Edmund Fitzgerald.

In November 1975, the Edmund Fitzgerald, a freighter loaded with 26,000 tons of taconite iron pellets, was nearing the safety of Whitefish Bay, north of the Soo Locks. A brutal storm with hurricane-force winds and 30-foot waves had been battering the Edmund Fitzgerald for hours. The captain, a 44-year veteran of the Great Lakes, radioed a ship not far behind that the Edmund Fitzgerald was taking on water, but that there was no immediate danger. Suddenly, the Edmund Fitzgerald disappeared from the other ship's radar. The next day, searchers found some debris, but no sign of the ship or any of its 29 crew members.

Initial reports suggested the Edmund Fitzgerald was lifted by two waves, one at the stern and one at the bow, causing the unsupported weight of its cargo to snap the 729-foot ship in two, sending it instantly to the bottom of the lake. However, after locating and photographing the ship several months later, a Coast Guard investigation determined the most likely cause of the disaster was flooding of the cargo holds, which caused the Edmund Fitzgerald to suddenly dive bow first below the water, much like a submarine. The Great Lakes Association presented a third possibility. The industry position was that the ship hit a shoal when it came too close to an island, which tore open the hull. Whatever the cause, the ship broke in two, coming to rest in 525 feet of water with the stern half upside down.

As the size of ships operating on the Great Lakes grew, their numbers decreased. In the early 1950s, there were more than 300 U.S. flagged ships operating on the Great Lakes, but that number fell to about 120 by the end of the 1970s. A nationwide recession took a further toll on shipping in the 1980s, reducing the number of vessels to just 45 by 1986. By 1995, the number had increased to 59 ships in operation on the Great Lakes. It must be noted, however, that modern Great Lakes freighters carry substantially larger cargoes then their smaller predecessors. In 1995, for instance, the fleet boasted 13 self-unloaders that were 1,000 feet long. These 13 ships had the same carrying capacity as 65 of the older 600-foot vessels.

Iron ore for the steel industry has long been the primary cargo for U.S. flagged ships on the Great Lakes. Therefore, the Great Lakes shipping industry was seriously affected by economic conditions that crippled Midwestern steelmakers in the 1980s, especially the influx of cheap foreign steel and a general economic recession. In bullish economies, United States and Canadian Lakes freighters carried as much as 100 million tons of ore in a single season, generally from late March to early January, before ice closed the Soo Locks. However, from 1983 until the early 1990s, the Great Lakes fleet averaged about 60 million tons per year. In 1995 the Great Lakes vessels carried 70.6 million net tons of iron ore as compared to 64.3 million net tons in 1991.

Coal was the second largest cargo for Great Lakes shippers. Most of the coal was mined in the Appalachian regions of West Virginia, Kentucky, Pennsylvania, and Ohio and shipped by rail to ports on Lake Erie. From there, it was distributed by freighters to utilities and industries throughout the Great Lakes region. Midwest coal also was loaded at Chicago and Thunder Bay, Ontario. Low-sulfur coal from the Powder River Basin in Wyoming and Montana was loaded at Superior, Wisconsin, which shared a harbor with Duluth, Minnesota. Low-sulfur coal was used by utilities on the Lower Great Lakes because burning it produced less sulfur dioxide, a major cause of air pollution. In 1995, coal shipments totaled 32.9 million net tons, down from 35.3 million in 1991.

Other Great Lakes cargoes included limestone and gypsum for the steel industry, cement, and liquid bulk products such as asphalt, gasoline, and light heating oil. In 1995 Great Lakes freighters carried 34.6 million net tons of limestone and gypsum, 4.6 million tons of cement, and 4.7 million tons of liquid bulk products. In the same year, 18.8 million net tons of grain were carried on the Great Lakes. This represented the most U.S. grain shipped on the Great Lakes since 1984 and was fueled by strong overseas markets and ample stocks from a good growing season. Dry and liquid-bulk commerce on the Great Lakes totaled 173.6 million net tons in 1995.

The 1995 navigation season on the Great Lakes was blessed by favorable weather and a favorable economic climate. The season opened on March 25 and by May 1 all 59 U.S. flag self-unloaders available for service were in operation. The season closed on January 15, 1996, for a total of 297 days. The 1996 season was expected to be a repeat of the 1995 season. This optimistic prediction was based on select sectors of a strong U.S. economy. Especially important was a growing foreign market for steel, which was expected to boost iron ore shipments, long a mainstay of Great Lakes commerce. By early 1996, industry insiders were hopeful about the year's grain shipments, but by mid-year optimism had turned to pessimism. A quick drop in grain shipments forced shipping concerns to tie up some of their vessels. Winnipeg-based Seaway Bulk Carriers was forced to sideline 12 of their 24 grain carriers. Canadian movement of grain through the end of June was down by 1.4 million metric tons as compared to 1995, while U.S. shipments were down 1.7 million metric tons compared to a year earlier. The drop was blamed on low grain supplies, not low demand or low prices. The low supply of grain was due to a late winter and wet spring, which delayed the planting of wheat in many regions.

The Jones Act. Passed in 1920, the Jones Act required that cargo shipped between U.S. ports be carried in vessels that were owned, crewed, and built by U.S. citizens. Other cabotage laws set similar standards for passenger service, towing in U.S. harbors, and salvage operation in territorial waters. Initially, the Jones Act was passed to ensure the safety of U.S. ports and guarantee that the United States would maintain a strong merchant marine. In lobbying for continued enforcement, the Lake Carriers' Association also pointed out that by protecting the Great Lakes fleet from foreign competition, the Jones Act provided the assurance that shippers needed to invest in safe, modern vessels that are manned by seaman who are certified by the U.S. Coast Guard.

In 1996, however, the Coastal Shipping Competition Act (H.R. 4006) was introduced in the U.S. House of Representatives. This bill was similar to legislation introduced in the U.S. Senate earlier in the year. These bills, if passed, would allow foreign-flag, foreign-built vessels to carry U.S. products between U.S. ports. Adherents of the legislation claim that the lack of adequate waterborne transportation vessels had a negative effect on the movement of American products between American ports. In other words, existing American flag vessels were inadequate to meet the demand. This forced businesses and consumers to purchase foreign goods that could be moved between U.S. ports on foreign vessels. Opponents of the legislation, which included the Lake Carrier's Association, believed that repealing the Jones Act would result in the loss of 125,000 American jobs on the Great Lakes and decimate the domestic shipbuilding industry.

Winter Navigation. When the Soo Canal was opened in 1855, the weather controlled the navigation season. Fierce gales would begin whipping across Lake Superior in November, sending most Great Lakes schooners scurrying for port. By mid-December, ice closed the canal completely, and shipping did not resume until the spring thaw. The steel-hulled steamers that began replacing the schooners in the 1880s were better suited to challenge the weather. As bigger and more powerful ships were able to break through the ice, the closing date was pushed back steadily to as late as mid-January. From 1974 to 1979, the locks were open year-round.

Environmentalists raised concerns in the 1980s that year-round operation might have adverse affects on water levels in Lake Superior and the lower Great Lakes and that ships forcing their way through ice-covered channels might cause damage to the shoreline. Such concerns prompted the Soo Canal to revert to a navigation season based on the formation of ice. In 1990, the Army Corps of Engineers said it found no evidence of environmental damage and set January 15 as the official closing date. In 1993, although environmental groups still objected, the Corps recommended March 21 as the official date to open the locks. The Lake Carriers' Association supported establishment of a fixed navigational season. In early 1996, however, the U.S. Army Corps of Engineers published a notice in the Federal Register proposing that the Soo Locks open on March 25, fixing the Great Lakes navigation season from that date until January 15. The Lake Carrier's Association saw this set season as a compromise they could live with.

Another issue on the Lake Carriers' Association agenda was the status of the Coast Guard's icebreaker, the U.S.S. Mackinaw. As the navigational season above the Soo Locks lengthened, freighters occasionally needed the Mackinaw to free them from unusually heavy ice build-up and to keep the shipping lanes open. For example, gale-force winter winds on Lake Superior have been known to create six-foot-high windrows of ice at the Duluth/Superior harbor in a matter of hours. The Mackinaw was also needed to break up ice in the St. Clair River north of Detroit twice in the 1980s. In the late 1980s, the Coast Guard announced that it would decommission the Mackinaw because of budget problems, but the Lake Carriers' Association convinced Congress to save the icebreaker. A modernization program that the association said would cut the Mackinaw's $3 million operating expense in half was scheduled to begin in 1993. In its annual report for 1992, the Lake Carriers' Association said, "The March 21-January 15 navigation season so necessary to the continued health of the Great Lakes economy can be attained with certainty only if the Mackinaw is primed and ready for the ice seasons that accompany the opening and closing of navigation."

By 1996, however, the Lake Carrier's Association was beginning to modify its stand on the Mackinaw. Christened in 1944 the Mackinaw, was the most powerful of the nine Coast Guard icebreakers operating on the Great Lakes. Capable of generating 10,000 shaft horsepower and displacing 5,000 tons, no windrow of ridged ice on the Lakes proved too much for the Mackinaw . Although recognizing that the 51-year-old cutter was structurally sound and internal modernization could be cost-effective, the Association questioned the economic viability of year-round maintenance on a vessel used only during the winter shipping season. Members of the Association noted that an off-season use for the vessel could not be found and that the Mackinaw was "under utilized" during the summer months. They noted that it was perhaps time to "plan for a post- Mackinaw world." One option was the possible leasing of an icebreaker. In the interim, the Association planned to continue to support the operation of the Mackinaw, and if a replacement was ever planned, the Association felt it should be a multipurpose vessel adaptable to a variety of year-round tasks. In late 1999 the Coast Guard officially announced that the Mackinaw would be decommissioned following the 2005 to 2006 season. Renovating it would have cost $147 million, but a new vessel would only cost an estimated $128 million. As of 1999, the Mackinaw averaged 134 days out of port per year; it was hoped that her replacement would sail 185 days per year.

Industry Concerns. Twenty-two of the U.S. flagged ships operating on the Great Lakes in 1993, representing almost 70 percent of the American fleet's total cargo capacity, were called Poe-class vessels. This meant they were too large to use any of the locks at Sault Sainte Marie except the Poe Lock, which was opened in 1969. In 1986, Congress authorized the construction of a second Poe-sized lock as part of the Water Resources Development Act. However, the law required that local funding pay 35 percent of the cost, and the lock was never built.

In 1992 the Lake Carriers' Association estimated a new Poe-sized lock would cost $400 million, with local costs of $140 million. In lobbying for full federal funding, the association warned that any lengthy closure of the Poe Lock would bring much of the U.S.-flag shipping on the Great Lakes to a standstill. Canadian ships and other foreign-flagged vessels small enough for the locks on the St. Lawrence Seaway would not be affected.

Another environmental concern for Great Lakes carriers was the disposal of materials dredged from ports and navigation channels. Each inch of reduced draft in waterways reduced the amount of cargo that could be carried by a 1,000-foot freighter by roughly 270 tons. With shoreline erosion, storm runoff, and airborne dirt, dredging was an ongoing requirement. Until 1970, sediment was disposed of by dumping it in deep water areas. But sediment, especially from industrial ports, was often contaminated with petroleum products and other chemicals. In the 1970s, the federal government began requiring that material dredged from harbors be stored in government-built confined disposal facilities. As a result, in the early 1990s, some harbors had not been dredged in nearly 20 years. According to the Lake Carriers' Association, disposal facilities at Duluth and Cleveland would be full by the end of the century, and all but two of the remaining 24 disposal facilities would be full by 2006.

The Association urged the federal government to allow non-polluted sediment to be dumped in deep water or used constructively for projects such as beach replenishment. Under the Association's plan, disposal facilities would be reserved for contaminated sediment. The Association also urged the federal government to pay part of the cost of dredging and for the construction of new disposal facilities where containment was necessary.

In 1999, the estimated capacity of the U.S. Flag Great Lakes fleet (in excess of 1,000 gross registered tonnage) was 732,403 deadweight tons (DWT.) for dry bulk active carriers (plus another 222,968 DWT. for inactive laid-up carriers); 78,465 DWT. for active (plus 3,413 DWT. for inactive) ITB bulk carriers; and 9,758 DWT. for the active tanker (and 8,150 DWT. for the inactive tanker). Total 1999 DWT. capacity was 1,060,157. As of September 1999, rate hikes for cargo shipments on the Great Lakes had varied less than 0.4 percent overall from those of 1998. (This statistic was controlled by supply and demand.) However, 1998 business had been significantly better than 1997, with a 4 to 6 percent increase overall.

Current Conditions

In the early 2000s, the Lake Carriers' Association—which represents the majority of U.S. flag ships transporting freight on the Great Lakes—was comprised of 12 member companies. Together, their ships had a combined capacity of nearly two million gross tons. Of the 162.3 million net tons of dry bulk cargo shipped during 2002 (a decrease of 1.4 percent from 2001), 36 percent was iron ore, followed by coal (26 percent) and stone (22 percent). The remainder consisted of salt, cement, potash, and grain.

The total number of active vessels in the U.S. Flag Great Lakes Fleet has been declining steadily in recent years. From 66 vessels in 1998, the fleet's size fell to 63 vessels in 1999 and 2000, and 58 in 2001 and 2002. According to the Lake Carriers' Association, this decrease was attributable to downturns in the U.S. steel industry. With the exception of intra-territory traffic, the U.S. Army Corps of Engineers revealed that all categories of domestic U.S. waterborne traffic declined from 2000 to 2001. However, lake-wise traffic saw the largest year-to-year decline from 2000, falling 12.6 percent on a tonnage basis.

According to the January 6, 2002, issue of the Chicago Tribune , declining water levels across the Great Lakes have caused concern within the industry in recent years. The publication reported that levels fell to 35-year lows in the early 2000s due to mild winters and dry weather conditions. Revealing the consequences for shippers, U.S. Great Lakes Shipping Association Executive Director Helen Brohl explained: "for every inch of water Lake Michigan loses, a cargo ship must reduce its load by 90 to 115 metric tons. Per barge, that means a loss of between $22,000 and $28,000—costs that are typically passed on to the consumer—for every inch the water drops."

Industry Leaders

American Steamship Company. The American Steamship Company was founded in 1907 by Adam E. Cornelius, Sr. and John J. Borland, Sr. The Oswego Shipping Company purchased American Steamship in the 1960s and sold the company in the 1970s to the GATX Corporation. The company's headquarters are in Williamsville, New York. American Steamship's 770-foot St. Clair set a record in 1997 by delivering the largest coal cargo (45,411 tons) to a Canadian Great Lakes port west of the Welland Canal (Nanticoke).

In 2003, American Steamship operated 11 self-unloading freighters with a combined capacity of 479,100 gross tons. In cargo capacity, American Steamship has ranked as the largest of the U.S. flagged Great Lakes shipping companies in recent years. Seven of the company's lakers were Poe-class vessels, including the 1,000-foot Indiana Harbor, which carried a U.S. flag record 64,390 tons of iron ore in one trip through the Soo Canal in 1986. In the 1990s, American Steamship carried about 50 percent of the coal shipped on the Great Lakes. It also carried iron ore and stone.

Interlake Steamship Company. The Interlake Steamship Company, headquartered in Cleveland, Ohio, was another leading Great Lakes freight company in the early 2000s. In 2001, the company operated 10 vessels with a total capacity of almost 364,000 tons. In May of 1998, its Elton Hoyt 2nd , at 698 feet, became the longest vessel to ever navigate the Federal Channel in Cleveland's Cuyahoga River, known for its twisting path. In 1999, Interlake moved its Great Lakes office from Cleveland to a new $5.2 million building in Richfield.

Oglebay Norton Company. The Oglebay Norton Company was founded in 1890 by Earl W. Oglebay and David Z. Norton. Oglebay was an experienced shipping agent and Norton was a former bank head cashier acting on behalf of oil magnate John D. Rockefeller, who had purchased iron-bearing land in the Mesabi range of Minnesota. Both Oglebay and Rockefeller were associated with the Tuttle family, pioneers in iron-ore shipping on the Great Lakes. As a teenager in the 1850s, Rockefeller worked for shipping agents Isaac Hewitt and Henry Tuttle. The firm of Hewitt & Tuttle later became H.B. Tuttle & Company. In the 1880s, Oglebay became acquainted with Horace Tuttle, who was then running the company founded by his father. In 1884, Tuttle & Company became Tuttle, Oglebay and Company. Horace Tuttle died in an accident in 1889 and in the following year Tuttle, Oglebay and Company was dissolved and succeeded by Oglebay Norton.

Oglebay Norton managed sales and shipping for Rockefeller's Lake Superior Consolidated Iron Mines until 1901, when Rockefeller sold his ships and mining interests to the U.S. Steel Corporation. Oglebay Norton continued as a shipping agent for other mining interests, eventually acquiring a fleet of ships and forming the Columbia Steamship Company in 1920. The Edmund Fitzgerald was the flagship for the Columbia fleet from 1958 until it sank in 1975. More recently, the company's 1,000-foot Columbia Star set a coal cargo long-haul record of 70,903 net tons on July 6, 1997.

In 1928, the company also began manufacturing equipment for the steel-making industry. The company began shipping coal in 1936. In 1939, Oglebay Norton formed the Reserve Mining Company and began mining taconite, a low-grade iron ore previously considered useless. As high-quality iron ore reserves dwindled, taconite grew in importance. From the 1970s on, almost all iron ore mined in Michigan and Minnesota was taconite.

As of 2003, Oglebay Norton operated the largest fleet among Great Lakes shipping companies. Among its 12 vessels were two 1,000-foot freighters, the Columbia Star and Oglebay Norton, each of which could carry more than 60,000 tons. The fleet's cargo capacity was about 340,000 tons. The Oglebay Norton set a record in 1992 by hauling 59,078 tons of limestone from Cedarville, Michigan, to Ludington, Michigan. In 1986, the same ship, then known as the Lewis Wilson Foy, carried a record 72,351 tons of iron ore. In January 2002, Oglebay Norton and American Steamship entered into a multiyear agreement to pool the assets of their respective fleets, in order to improve levels of efficiency and service for customers.

Further Reading

Barker, James R. "FDCH Congressional Testimony," presented September 15, 1998. Senate Commerce, Science and Transportation Economics Reports/Data, 1998.

Bullard, Sam, and Jennifer Beauprez. "Interlake Steamship Cruising to New Richfield Home." Crain's Cleveland Business, 1 June 1998.

Bush, Rudolph. "Great Lakes Keep Losing Their Water." Chicago Tribune. 6 January 2002.

Hatcher, Harlan. The Great Lakes. New York: Oxford University Press, 1944.

Hatcher, Harlan, and Erich A. Walter. A Pictorial History of the Great Lakes. New York: Crown Publishers, 1963.

Havighurst, Walter. The Great Lakes Reader. New York: The Macmillan Company, 1967.

Katz-Stone, Adam. "The Party's About Over: MAC Will No Longer Break The Ice." Navy Times, 22 November 1999.

Lake Carriers' Association. 1995 Annual Report, 1996 Objectives. Cleveland: Lake Carrier's Association, 1996.

——. "Fleet Count Same as a Year Ago." 4 September 2002. Available from http://www.lcaships.com .

——. "Lake Carriers' Association Summary of Membership as of May 2001." 6 August 2002. Available from http://www.lcaships.com .

——. "Lakes Shipping Down 1.4 Percent in 2002." 26 March 2003. Available from http://www.lcaships.com .

"Market Watch." Logistics Management & Distribution Report, November 1999.

Oglebay Norton Co. "Oglebay Norton Company and American Steamship Company to Pool Great Lakes Fleets." 3 January 2002. Available from http://www.oglebaynorton.com .

Stonehouse, Frederick. The Wreck of the Edmund Fitzgerald. Au Train, Michigan: Avery Color Studios, 1977.

The Transportation Institute. "Industry Profile: 1999." Available from http://www.trans-inst.org/ind_profile.html .

Waterborne Commerce Statistics Center, U.S. Army Corps of Engineers. "Domestic U.S. Waterborne Traffic." 6 November 2002.



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