After failing to meet thousands of grain car orders on time earlier this crop year CN says it’s running out of grain so it’s “temporarily parking roughly 1,200 hopper cars.”
However, those cars are available if needed, CN said in a news release May 2.
“CN said today it has met all grain orders in Western Canada for the third straight week, is current to demand and is seeking additional export orders from grain companies.”In an April 4 interview Sean Finn, CN Rail’s executive vice-president of corporate services and chief legal officer, predicted cars would get parked this month.
“But… we won’t take the pedal off the gas until we’re comfortable we have no unfilled orders,” he said.
Parking rail cars is normal this time of year, Western Grain Elevator Association executive director Wade Sobkowich, said in an interview May 4.
“It happens every year,” he said, when farmers start seeding and road weight restriction are on. “We have a peak demand period and it ends around the end of March. And then demand for grain shipping goes down. But the whole point is, what was demand, and what is demand. We need the movement when we demand it, not eventually. But yes, I would say right now that is the case that CN is performing very well. “
Ag Transport Coalition data for the most recent week showed CN delivered 91 per cent of cars orders on time, he said.
“We consider that to be very good,” Sobkowich said.
“CN performance has improved in a big way and that needs to be recognized.”
CN spotted a weekly average of 5,756 and 6,158 cars in March and April, respectively.
“The decisive action we took in March to deploy more crews and locomotives has led to dramatic improvements in the movement of Western Canadian grain,” said Doug MacDonald, vice president of bulk at CN. “We’ve met all of our car orders for the last three weeks and spotted more than 5,500 cars every week since early March. Sustained sequential improvement across our network in the last two months is enabling us to solicit more orders from grain companies.”
In the meantime, CP Rail’s service is declining performing, Sobkowich said, delivering just 53 per cent of ordered cars on time last week.
It might be confusing to some that CN has a 25,000 car backlog, but is running out of grain to ship. Those 25,000 cars represent cumulative unfulfilled demand for the time period, Sobkowich explained. Since some of that car demand has disappeared because of reduced export demand and a slow down in farmers delivering grain, the so-called backlog isn’t as large.
CN is performing well now, but Sobkowich wonders if it will continue, “including next winter when there is a very high likelihood that it’s going to be cold.”
CN has promised to do better. As part of CN’s record $3.4 billion capital program in 2018, the company is investing in new trade-enabling infrastructure and equipment, its release said. In addition to 350 new box cars and 350 new lumber cars ordered for this year, CN expects in June to take delivery of the first of 60 new GE locomotives due in service in 2018.
This spring, CN started its largest-ever infrastructure investment program, which includes $400 million to build new track and yard capacity to handle increased traffic across CN’s Western Region, and to Chicago.
The infrastructure program includes new siding and double track projects benefiting grain, forest products, intermodal, coal and potash business.
After adding hundreds of train conductors to the field so far this year, CN continues to hire with a particular focus on crews in Western Canada. Approximately 1,250 more qualified train conductors will be in the field before next winter, compared to the number of conductors available before last winter.
“Hopefully then that means that they’re going to maintain this service level now because fool me once shame on you, fool me twice shame on me,” Sobkowich said. “It’s hard not to be sceptical that this isn’t going to go back to the way it was.”