Railways feeling the heat over grain backlogs
TRANSPORT New criticism from U.S. group, Sask. premier
TORONTO• Canadian railways are continuing to feel the heat over their struggle to keep up with the demand for grain shipments.
While grain farmers on the Prairies have been airing complaints for months, the railways faced new criticism this week in the U.S. from the National Grain and Feed Association, which lamented the “systemic shedding of resources by Class I carriers,” including CP and CN.
In a letter to the U.S. Surface Transportation Board, which regulates railways, the NGFA said grain and grain product companies were increasingly having to rely on truck transportation to get shipments moving.
On Friday, Saskatchewan Premier Scott Moe added to the chorus, telling delegates of the Saskatchewan Association of Rural Municipalities that farmers are struggling to pay their bills as a result.
“Our reputation, Saskatchewan’s reputation and Canada’s reputation as a reliable supplier of commodities, as a trustworthy business partner is being damaged,” Moe said.
In an interview with the Financial Post, Moe said the federal government should consider an order in council “mandating volume based deliveries of our rail companies,” if CN and CP do not sufficiently address the problems.
He also said that he supports inner-switching, which would allow one company to come in and haul the grain if another railway is not able to meet the demand.
The troubles in Western Canada came to a head in February.
According to the Ag Transport Coalition, a group of agricultural associations, CN filled only 17 per cent of the hopper car requests for the week ending Feb. 24. That equalled the worst performance since the grain year started.
That week, CP provided 50 per cent of hopper car orders. At the time, Ag Transport Coalition said the five weeks leading up to Feb. 24 were the five worst weeks this year for on- time order fulfilment.
Ottawa asked CN and CP to submit service improvement plans, which were filed this week.
CN said it had created a 24/ 7 situation room at its Network Operations Centre in Edmonton to prioritize rail car movement, and that it was leasing 130 locomotives to increase capacity in Western Canada.
CP said it had made significant progress in resetting its network, and that grain shipments had increased 22 per cent in the week ended March 10. It is also adding locomotives and employees.
Earlier this month, CN’s CEO Luc Jobin suddenly quit and its chief marketing officer Jean- Jacques Ruest was named interim CEO.
CN spokesperson Kate Fenske said greater demands for other commodities and bad weather this winter had affected service, but insisted that “CN is prioritizing the movement of grain.”