Both major railways are struggling to move grain in a timely fashion. According to the Ag Transport Coalition, CPKC was the first to see badly lagging performance, but CN has now joined the downward swing.
The railways recovered from the brief labour disruption in August and movement was pretty good until November. However, starting in late November, unfulfilled hopper car orders started to climb. Milt Poirier puts together the Ag Transport Coalition reports with the latest report for crop week 26, which ended February 1.
“Coming out of week 26, the total backlog for CN and CP combined was more than 41-hundred cars – roughly 25-hundred for CP and 16-hundred for CN. That’s the highest level that we’ve seen in at least two years.” Poirier said.
As of February 3, there were 32 grain vessels in the Port of Vancouver – 13 of which had been in port for 13 to 33 days. Prince Rupert had six vessels in port, double what would be normal for this time of year. Over the next two weeks, Vancouver has 23 additional vessels scheduled to arrive while Prince Rupert has five more. Waiting vessels cost demurrage, which reduces the price producers are paid for their grain. Milt Poirier is not optimistic about a railway recovery.
“If nothing changes, shippers are basically going to be looking at sub-standard levels of service probably until April, maybe as long as May,” he stated.
In the short term, the protracted cold snap in Western Canada is expected to further challenge railway performance as it impacts the length of trains that can run.