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Grain backlog no longer a problem

The railways are filling more car orders, but also unfilled earlier sales were lost

This year’s grain shipping backlog is mostly gone.

“Members (of the Western Grain Elevators Association) are fairly current right now after having to defer sales, and not make new sales, and make adjustments to their sales books to reduce the amount they can sell during peak price periods,” WGEA executive director Wade Sobkowich told reporters May 24. “So now they’re current, but it was out of necessity because they had to adjust their demand downward because they just weren’t getting the cars.”

About 30,000 cars ordered by grain companies didn’t get delivered by the railways on time, he said.

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Those cars represent cumulative unfilled demand, but unfortunately some of it is gone now, Sobkowich said.

According to the latest Ag Transport Coalition data CN and CP Rail delivered 92 and 84 per cent of that week’s car orders on time, he said.

While CN’s performance was poor much of the winter, it has improved a lot since March, Sobkowich said.

CP’s performance declined in the late winter, but has improved more recently, he said.

“So while the railways have caught up, the railways always improve in the springtime when farmers are seeding and when there’s road bans so it’s not a surprise to see the percentages increase in this particular period of time,” Sobkowich said. “But we can’t lose sight of the fact that the poor service they provided in the fall and the winter is something we’ll never recover from.”

The backlog was much bigger in 2013-14. That one cost WGEA members $90 million in tangible losses from contract extensions and demurrage, he said.

“But there are intangible costs like deferring sales into future, non-peak price periods. How much did you lose there? Hard to measure. And cost to reputation as a reliable supplier of grains, oilseeds and pulse crops? Can’t measure those things. The best indication I can give right now is that it will be about two-thirds to three-quarters of the impact that it was in 2013-14.”

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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