CN apologizes for grain backlog
COMPANY PROMISES IMMEDIATE ACTION TO CLEAR BACKLOG OF GRAIN SHIPMENTS
Canadian National Railway Co. is apologizing for failing to keep grain shipments moving reliably by rail, and says it’s taking immediate steps to clear the backlog — including mobilizing more train cars and workers.
The move comes just two days after CN dumped its president and CEO amid growing complaints that the backlog of shipments is compromising Canada’s reputation as a reliable exporter, costing sales and putting farmers in a cash-flow crunch.
“We apologize for not meeting the expectations of our grain customers, nor our own high standards,” JeanJacques Ruest, who took over the helm of CN from Luc Jobin on an interim basis, said in a statement early Wednesday.
“The entire CN team has a sense of urgency and is fully focused on getting it right for farmers and our grain customers, regaining the confidence of Canadian businesses and protecting Canada’s reputation as a stable trade partner in world markets.
“Moving the Canadian economy is in our DNA. We can and we will do much better and that starts today — no excuses.”
Among other things, the company said it’s offering incentives for key operating employees to delay retirement and postpone vacations, and to entice recently-retired employees to return to work.
It’s also deploying qualified managers to operate extra trains and adding train crews in Western Canada.
CN said it has leased 130 locomotives to increase capacity, almost all of which are now in use. And it’s investing more than $250 million this year to build new track and yard capacity in Western Canada.
Farm Credit Canada, the country’s largest agricultural lender, announced Wednesday it would offer credit to grain farmers who have been unable to pay off last year’s loans because there are no rail cars to take their grain to ships waiting in port. Farmers typically have to pay back existing debt before they can access credit for the new seasons inputs, such as seed and fertilizer.
“We will support customers as needed and continue to ensure they have the financial means to get their crops in the ground this spring,” said Michael Hoffort, president of Farm Credit Canada, noting a similar program was used during the grain crisis of 2014.
According to the Ag Transport Coalition, CN and Canadian Pacific combined provided only 38 per cent of the rail cars ordered by grain shippers during the week of Feb. 12 — CP delivered 66 per cent of its orders and CN just 17 per cent.