Frozen Great Lakes Means Frozen Assets

O N  L A K E  M I C H I G A N, March 12 -- It was almost painful to watch. The U.S. Coast Guard Cutter Sun Dew this morning, bumping and grinding along the icy vastness that is now Lake Superior. The progress was achingly slow: 500 yards in three hours.

The Sun Dew was trying to cut a swath out of Duluth harbor and open up a vital navigation channel to the barge traffic now poised to depart. Poised, but that's about all.

No one is going anywhere on the Great Lakes these days. Superior is frozen over for the first time in almost a decade. Lakes Huron and Erie are completely covered in ice as well. From Minnesota to Montreal it's the same story: the barges can't get through.

The St. Lawrence Seaway officials decided this week to postpone its opening from March 25 to March 31, hoping the icy grip will be broken by then.

"If it's longer than that," said Diane Swonk, chief economist for Bank One in Chicago, "you start to get into some more major disruptions right down the supply chain."

For manufacturers dependent on things like steel, the timing is horrible. There was a slowdown in the manufacturing sector of the economy in February, so this freeze is the last thing production plants needed.

"It will exacerbate our feeling of war, weather and worry that we have out there at this stage of the game," said Swonk.

Barge Clog Stalls Commerce

While large portions of Lakes Ontario and Michigan remain navigable, the shoreline near Chicago is clogged.

At the southern tip of Lake Michigan is Calumet Harbor, into which flows the Calumet River. That river winds its way south and west across Illinois through an array of man-made canals to the Mississippi River. Barge traffic is constant in normal conditions. And vital. Huge shipments of grain and steel find their way to the Gulf of Mexico thanks to the barges that are loaded at ports along the northwest Indiana shore.

"People don't think about how these barges travel, but they really are a major form of commerce," said Swonk. "For many of these companies, there is no other form [of transport]. They're just going to have to delay all the way down the line. And that's where the real problem lies."