RAC: Canada’s Railways ‘Top of the Class’

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A new Railway Association of Canada study, Strengthening All Links: Building More Resilient, Fluid Supply Chains in Canada (download below), provides “detailed insights and exceptional clarity into the complexity of modern supply chains and transit time variability amid pandemic and other disruptions.”

“Four years’ worth of evidence proves Canadian railways remained strong and reliable despite the unprecedented impacts of COVID-19 on producers and suppliers everywhere,” notes study author Jonathan Thibault, RAC Manager of Economics, Data and Research. “A global pandemic, the war in Ukraine, extreme weather events, labour disruptions and shortages, and economic uncertainty … these are just some of the concurrent challenges supply chain players have faced in recent years. Supply chain players have demonstrated remarkable resiliency through it all, and Canadian railways are top of the class.” 

The report examines two supply chains that are of critical importance to the Canadian economy, exporters and consumers. It finds: 

• The end-to-end transit time of containerized consumer goods from Shanghai, China to markets in Ontario and Quebec increased by 13.8 days (or 52%) from 2019 to 2022. In the examination of each supply chain link, the report shows that 99% of the increase in container transit times were attributed to activities at sea and at port and occurred before the shipping container had even been loaded onto a railcar. 
• The end-to-end transit time for Saskatchewan grain to reach Chinese markets in 2022 was one day shorter than it was in 2019. In the examination of each supply chain link, the report shows that railways were the strongest contributor to the reduction in end-to-end transit time between 2019 and 2022. 

“Given the sheer numbers of variable at play in modern supply chains, disruptions are expected to become more frequent, less predictable, and more widely felt,” the report notes. “As a trading nation, strong, efficient, high performing, and cost-effective supply chains are critical to Canada’s prosperity. Evidence-based responses to future disruptions will be critical.” 

Canada’s railways have called measures in Budget 2023 —namely extended interswitching (reciprocal switching) and the replacement worker ban—“misguided and harmful to supply chains precisely because they ignore evidence and facts. Such proposals threaten to weaken supply chain links, running counter to stated government objectives like improving fluidity and resiliency.” 

“Again and again, Canadian railways and railroaders have delivered despite real challenges,” says Railway Association of Canada President Marc Brazeau. “This report should make clear to policymakers that the focus now must be on tangible actions to bolster supply chains, not inefficient economic regulation.” 

This research paper has been submitted to the Canadian Transportation Research Forum and will be discussed in detail at its 58^th annual conference, May 7-10, 2023 in Toronto.