CN Rail set grain-shipping records September to April

Longer manifest trains and increased rail and shipper efficiency are paying off, CN says

[Updated: June 8, 2017] It’s been a record-breaking year for grain movement on CN Rail during the 2016-17 crop year, even with a slow start in August.

CN’s David Przednowek says investments in the grain supply chain from load to unload, and every step in between, are beginning to pay dividends.
photo: CN Rail

“Once we hit September it was full blast,” David Przednowek, CN’s director of grain marketing, said in an interview May 17. “Each individual month from September all the way through April we’ve had a record month for (moving) Canadian grain. And that’s when grain wants to move.

“It has been a record month, eight months in a row.

“It has been a really positive story.”

Between Aug. 1, 2016 and mid-May 2017, CN hauled 195,600 cars of western grain, up 10 per cent from the three-year average, Kate Fenske, CN’s regional manager of public and government affairs wrote in an email. That translated into CN moving 17.6 million tonnes — 11 per cent more than the three-year average.

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Overall, grain movement has been good this crop year, Mark Hemmes, the president of Quorum Corporation, which monitors grain shipping for the federal government, said in an interview in late April.

Total grain shipping, including by CP Rail, was up 2.3 per cent during the first nine months of the 2016-17 shipping season, Quorum’s April report states.

The Western Grain Elevators Association (WGEA) is pleased with the rail service too, executive director Wade Sobkowich, said in an interview May 30. He hopes it continues.

*That’s CN’s goal, Przednowek said, noting that since 2009 CN’s grain traffic has jumped 45 to 50 per cent.

From 2006 to 2009 CN, on average, shipped 3,600 grain cars a week. This crop year it has averaged about 5,400 a week, Przednowek said.

“The railway wants to move grain,” he said.

“It doesn’t matter if it’s commercial rates or revenue cap regulated rate, we get paid when we move a car. So the more we can move it’s worth marketshare, carloads, it’s revenues. It’s good for us, it’s good for the farmer. It’s good for everybody.”

There are lots of reasons for CN’s success this crop year, but a lack of other products to haul isn’t one of them, Przednowek said.

CN Rail is transporting more Canadian and American coal and intermodal shipments are up too, he said.

“It’s not just one thing,” he said. “It’s a little bit of everything.

“That’s one of those misconceptions that’s out there. We are moving a lot of everything and on top of that we are delivering record grain movement in the fall and winter when the farmer wants to move it, which is a good thing.”

The WGEA has complained grain shipping suffers, especially following a disruption, because of all the other products the railways haul.

A WGEA brochure says in 2015-16 the railways shipped 30,000 more grain cars than the crop year before. That same year the railways also shipped 500,000 fewer total cars.

“When shipping is down in other industries at the same time grain shipping has improved, a reasonable person draws the conclusion that capacity has shifted from these other industries to grain,” Sobokowich said. “If CN is saying that’s not the case and shipping grain has nothing to do with lower demand in other industries, then when those other industries improve we look forward to the same level of service from CN that we are experiencing today.”

More unit trains, generally good weather this winter, new CN infrastructure and efficiencies introduced by others have all contributed to CN moving more grain this crop year, Przednowek said.

“This is a grain supply chain,” he said. “It’s not a rail supply chain. So in terms of efficiency and improving cycle times you have to have a lot of things happening from all of the players in the supply chain to get those empties back into the country faster. You have more efficient loaders out there so your loading time in the country is less. Grain companies have been making a lot of investments at the ports to be able to take more traffic off.”

Some grain companies are investing in equipment to charge rail car air brakes in the winter. CN’s Winter Ready Program gives elevators a $50-a-car credit from December to March for air charging unit trains. Air pressure for braking is a key limiting factor in winter railway movement in frigid Western Canada.

“It’s a win-win with the shipper, but it also creates network capacity because you’re not wasting six or 12 hours sitting there waiting for the train to air up,” Przednowek said.

CN has also invested in “repeater cars” to help maintain air brake pressure. The cars are equipped with diesel-powered air compressors. Temperatures of -25 C or lower make it more difficult to maintain air pressure, forcing the railways to run shorter trains, reducing capacity.

And while unit trains of 100 to 112 cars, loaded at one elevator, add efficiency, Przednowek said, CN’s manifest trains also increase capacity.

“Once we get to Edmonton we accumulate traffic from our regions,” he said. “We build big trains. We probably run 170 to 200 car trains into Vancouver.

“It’s a mix. It might be two unit trains that you built at Edmonton to pull to Prince Rupert or it could be a 100-car train that you pulled from origin, plus some other traffic that wants to find its way to Vancouver. So we build more of a manifest service. We’re not as focused in pure unit train shipments as some of the other carriers are.”

Manifest trains seem counterintuitive, but Przednowek explained it this way: “You only have so many slots in a given day (on the track) that you can run to the port. Think about it. If you’re running a big train — 170 or 200 cars versus that single unit train — that’s the way I look at it.”

Communication within CN, and with shippers in the country and terminal, is also key, Fenske said.

CN’s infrastructure investments, including more and longer sidings and more powerful locomotives, are paying off, Przednowek said.

Meanwhile, grain companies are expanding export capacity at Vancouver, including finding ways to load ships in the rain, he said.

“All those things around the margins, they all add up,” Przednowek said. “It means more movement at the peak.

“It’s a grain supply chain where everybody has got to be doing their part to help pitch in and make it more efficient and that’s happening. That’s a good thing.”

*[Update]:This article originally incorrectly stated that CN Rail’s grain traffic to the United States was up 75 per cent. In fact, CN’s total U.S. cross-border traffic was up 75 per cent, including grain traffic.

About the author

Reporter

Allan Dawson

Allan Dawson is a reporter with the Manitoba Co-operator based near Miami, Man. Covering agriculture since 1980, Dawson has spent most of his career with the Co-operator except for several years with Farmers’ Independent Weekly and before that a Morden-Winkler area radio station.

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