Canadian railways make progress on easing grain logjam

Tue Mar 18, 2014 4:55pm EDT
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By Rod Nickel

WINNIPEG, Manitoba (Reuters) - Canadian grain shipments by rail have picked up since earlier this month when Ottawa ordered Canadian National Railway Co and Canadian Pacific Railway Limited to improve service, CN and a grain-handling group said on Tuesday.

Transportation bottlenecks have left crops landlocked after a record-smashing harvest and frigid winter in Canada, the world's biggest canola exporter and No. 2 wheat shipper.

Grain handlers have seen "a slight improvement" in railway service during the past week and a half, helped by milder weather, said Wade Sobkowich, executive director of Western Grain Elevator Association, whose members include Cargill Ltd, Richardson International and Viterra.

CN, the biggest Canadian railway, spotted an average of 4,320 grain hopper cars per week at country elevators for the past two weeks, up from an average of 2,964 cars per week in February, said CN spokesman Mark Hallman.

The railway is in process of adding 500 more hopper cars, and intends to continue spotting more than 4,000 cars per week until Port of Thunder Bay, Ontario opens in early April, Hallman said. After that, it can move closer to the government-ordered target of 5,500 cars per week, provided there is strong collaboration from grain companies, he said.

Orders for tens of thousands of grain cars have gone unfilled in the requested time since August. Each hopper car contains about 90 tons of grain.

Canadian Pacific spokesman Ed Greenberg declined to disclose the number of cars it has recently deployed, but said the railway company is moving a record volume of Canadian grain.

Estimates of the number of hopper cars available last week vary by grain company, but last week may have been the busiest in 2014 so far, Sobkowich said.   Continued...