They arrive at an old unused dry dock that's been flooded, and as they look into the water, they see something moving in it.
The boxtrolls toss hunks of grass into the water, and the creature inside surfaces: it's a freshwater sea-cow. It looks like a dairy cow that's adapted to aquatic living.
Fish holds a conversation with the sea-cow, and then he talks to Willbury (who translates for Arthur).
The sea-cow is upset because her three calves had disappeared from this area, plus the tunnel that leads back to open water has been blocked.
Nobody knows of any more holes, so they return to Willbury's home. All this stuff is bad news.