Canada’s two Class I railroads continue to set records for grain moves. For the 2020-21 crop year, CN and Canadian Pacific (CP) each reported about 31 million metric tons (MMT) shipped, despite weather and other challenges.
CN shipped more than 31 MMT for the 2020-21 crop year, beating the previous record of 29.4 MMT set in the 2019-20 crop year, according to the railroad’s Aug. 3 report. It also moved more than 1.1 MMT of grain from Western Canada via containers, with grain volumes moved from Eastern Canada in addition to these levels.
CN’s 2021-22 Grain Plan (download below) reviews the railroad’s performance during the previous crop year, assesses its ability to move anticipated levels of grain during the upcoming crop year, and provides details on capacity. CN reported that it “expects to move, over the course of the 2021-2022 crop year, 25.5 to 28.0 MMT of grain and processed grain products via carload. This forecast is in the range of the past three crop years, but below 2020-2021 levels due to a material reduction in total available grain supplies year over year. Grain volumes moved using intermodal equipment are in addition to this level of projected shipments.”
“CN’s grain movement has been resilient during the pandemic, achieving 14 straight months of Canadian grain volume shipment records,” CN President and CEO JJ Ruest said. “We recognize that growing conditions across much of the Prairies have been very challenging as many producers face extremely hot and dry weather this year. Our dedicated team of railroaders will continue to work tirelessly with Canadian farmers, agri-organizations and grain customers to have the resources in place to move the upcoming harvest for the communities we proudly serve.” Ruest noted that CN remains “committed to making capacity-enhancing investments to our network and to upgrade our rolling stock.”
In May 2021, the railroad announced that it would purchase 1,000 high-capacity hopper cars from TrinityRail, part of a broader 3,500 car fleet renewal program over the next three years, which is slated to bring CN’s fleet of new-generation, high-capacity hoppers to 6,000.
CP on Aug. 3 reported hauling 30.62 MMT of Canadian grain and grain products this crop production year—more than any other in its 140-year history, and the fourth consecutive year it broke annual movement records. This exceeded last year’s record of 29.52 MMT by 3.7%. Including grain moved in containers, CP hauled a total of 31.21 MMT in the 2020-21 crop year, up 3.4% from last crop year.
The railroad reported that its 2020-21 grain movement was 15% ahead year-over-year through the fall peak, and at the end of March, it had moved 14% more this crop year compared with the previous crop year. CP noted, however, “because of market conditions and a tight supply of grain, demand started to fall off in April. Through May, June and July, shipper demand was almost 15% below the same period last year, and 25% below the fall peak demand levels.”
CP attributes this crop year’s success to the “efficiency of the 8,500-foot High Efficiency Product (HEP) train model”—which can carry in excess of 40% more grain than the 7,000-foot train model when combined with capacity from CP’s new high-efficiency hopper cars—and customer investments. The railroad said it serves 25 elevators qualified to load 8,500-foot HEP trains, 13 of which became qualified during the 2020-21 crop year. By the end of 2021, more than 40% of the CP-served unit train loaders will be 8,500-foot HEP qualified, according to the railroad.
CP also reported that it continues to take delivery of high-capacity grain hopper cars as part of its $500 million commitment in 2018 to purchase 5,900 new-generation cars, which can carry 10% more grain by weight and 15% more by volume than the older cars they are replacing. Currently, CP has more than 4,600 owned and leased new high-capacity hopper cars in active service, and plans to add 1,600 more by the end of 2021. “This capacity upgrade has increased the amount of grain CP was able to transport in each railcar by more than 1 metric ton from a year earlier, and by almost 3 metric tons since the start of the fleet renewal program in 2018,” the railroad said.
Among the highlights from CP’s 2021-2022 Grain Service Outlook Report (download below):
• “CP anticipates the 2021-2022 Western Canadian grain crop volume to be lower than the past two crop years. CP is concerned that above average temperatures and persistent dryness—experienced in early summer—may impact crop yields. This forecast is consistent with the expectation of our customers.”
• “CP is well-positioned to move grain in the 2021-2022 crop year. We expect to move in excess of 30 MMT of grain and grain products this crop year, which is aligned with last year’s forecast and the volumes we transported.”
“The challenge created by the COVID-19 pandemic over the past 17 months has underpinned the value of strong communication and supply chain collaboration,” said Joan Hardy, CP Vice-President Sales and Marketing, Grain and Fertilizers. “Despite a sharp reduction in demand this spring, CP and our customers have again broken our movement record, and we celebrate that achievement across the supply chain.”