CN Rail expecting more eastbound shipments of grain and other commodities from Western Canada

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CN Rail is preparing for more eastbound shipments of grain and other commodities from Western Canada.

As part of its federally-mandated plan for moving grain in 2022-23, the railway says it’s not only anticipating a much larger crop in Western Canada after last year’s drought, but it’s also expecting a re-balancing of trade corridors to the east, including rail shipments to Thunder Bay when the St. Lawrence Seaway is open, and direct rail shipments to St. Lawrence River ports when the Seaway closes for winter.

“Given the unique circumstances that will surround this upcoming crop year, especially with the changes in trade flow patterns caused by the war in Ukraine, the eastern Canadian supply chain is going to be an opportunity,” says David Przednowek, CN’s assistant vice-president – grain, in the interview below. “If we can tip that balance a little bit back more to the east, not only for grain, but for other commodities, that’s going to help get more product to market.”

In addition to the fallout from the war in Ukraine, the railway sees increased utilization of the eastern corridor as a risk diversification strategy following stoppages along the mainline between Edmonton and the Port of Vancouver due to wildfires and flooding in southern B.C. over the last year.

One of the big factors that limits grain movement east is freeze-up at Thunder Bay, which typically occurs around December 20. After that, he says there are three terminals on the St. Lawrence at Montreal, Quebec City, and Trois-Rivieres that are connected to CN’s network and have been “significantly under-utilized.”

“That’s going to be an opportunity, when the Lakehead closes, to be able to move more grain through the supply chain during that winter period,” says Przednowek.

Overall, the railway says it’s prepared to move 744 thousand tonnes of grain and processed grain products per week outside of winter, and up to 595 thousand tonnes per week during winter. CN is adding 500 new hopper cars to its fleet in 2022, and plans to add another 500 in early 2023, with delivery of another 750 hopper cars in 2023 and 2024. As part of the 2022/23 grain plan, the railway also says it’s adding 57 new locomotives and planning to hire more than 500 new employees in Western Canada.

CN and CP Rail are required under federal legislation to submit annual grain movement plans at the start of a new crop year.

Listen to CN’s David Przednowek discuss the upcoming grain shipping season with a larger crop expected, the anticipation of more shipments east, the possibility of a Teamsters strike/lockout, and more:

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