Opinion
Submitted by the Ag Transport Coalition
As the world grapples with geopolitical challenges and global economic volatility, Canada’s agricultural sector remains one of the country’s key economic pillars. However, this sector is increasingly facing a grave threat—not only from external factors—but from within our own supply chain infrastructure: the chronic and worsening rail service failures that are crippling Canada’s grain industry.
The current state of rail service in Canada, particularly for grain shipments, is putting the entire agricultural export sector at risk. Over the past several months, rail performance has deteriorated to a point where the very ability of Canadian farmers and agribusinesses to fulfill export contracts and meet global demand is being seriously jeopardized. As a result, Canadian farmers and exporters are losing competitiveness, facing delayed shipments, and in some cases, incurring penalties due to missed delivery deadlines. The consequences of these ongoing service issues are now reverberating through every part of Canada’s agricultural economy.
A Deepening Crisis
At the heart of the problem is the inability of the railways to meet grain shipper demand for rail equipment and to supply that equipment in a timely manner. Those failures are disrupting grain supply chain planning and activities at both country elevators and export terminals.
Since mid November, CN has supplied on average only 56% of all cars ordered by shippers in the week for which they were ordered. CPKC’s performance has been equally poor with the railway supplying only 62% of shipper orders on time over that same period. Over the last seven weeks CPKC has failed to supply more than 55% of shipper orders in any week and have averaged only 41% over the preceding four weeks.
Making matters worse is the railways’ combined performance in the critical export corridors of Vancouver and Prince Rupert. Since November CN and CPKC have supplied an average of 60% of shipper rail car orders each week for Vancouver with performance ranging from a low of 36% to a high of 75%. For Prince Rupert, CN’s performance has been equally poor with the railway supplying an average of 53% of cars ordered on a weekly basis with performance in week 29 falling as low as 19%.
Exacerbating this situation is the severe order rationing undertaken by CN, further reducing shipping capacity and delaying the movement of grain. CN Rail alone has rationed over 12,000 shipper orders this grain year, including 8,600 orders in just the last two and a half months. Critical export corridors like Vancouver and Prince Rupert have been hit the hardest, with rationing severely disrupting the timely shipment of grain. During the peak periods of this crisis, CN rationed nearly 4,800 orders for these vital corridors—impeding 42% of total demand. Meanwhile, CPKC, despite rationing less aggressively, has faced an unprecedented backlog of rail car orders averaging 4,000 cars per week over the last four weeks, peaking at 4,600 in week 29, equivalent to an entire week’s worth of demand.
These backlogs translate directly into delays for Canadian grain shipments, causing major disruptions. The impact is not just an inconvenience—it is a direct blow to the economic viability of Canadian agricultural exports.
Delays and Their Global Implications
The scope of the delays is staggering. On CN’s network, the number of delayed cars has averaged 1,500 per day since the beginning of February, peaking at more than 2,100 cars per day in week 29. That means that anywhere from 30% to 50% of all grain shipments are delayed on a weekly basis.
The resulting delays have caused gridlock at Canadian ports. Since early January, the Port of Vancouver alone has seen a 67% net increase in the number of grain vessels in port peaking at 40 vessels on March 9th. Of these, 18 vessels have been delayed in port for 13 to 34+ days due to inadequate rail deliveries. This congestion is not just an operational challenge; it has severe financial consequences. Grain exporters are facing contractual penalties and potentially losing market share to competitors who can deliver on time. As the number of vessels waiting in port increases—39 vessels arriving and only 27 departing in just the past three weeks—the situation is only worsening.
The Need for Sustainable Solutions
While extreme winter weather has been cited as a contributing factor to some of the rail service disruptions, this issue predates the cold weather. Rail service problems have been building for months, and the aggressive rationing by CN and the complete lack of viable solutions from CPKC have only worsened the situation.
The lack of reliable rail service is a ticking time bomb for Canada’s agricultural exporters. It is not simply an operational inefficiency; it is a fundamental threat to Canada’s reputation as a global supplier of agricultural products. As the geopolitical landscape becomes increasingly uncertain and protectionist policies rise, Canada cannot afford to lose its place in global markets. Rail service must be reliable, predictable, and consistent, or the Canadian agricultural sector will not survive—let alone thrive.
The Path Forward
The Canadian agricultural sector needs leadership from our federal politicians, Transport Canada, and other regulatory bodies to ensure that rail service providers meet the demands of the modern global economy. This means ensuring that rail companies prioritize grain transportation, invest in their infrastructure, and adopt sustainable, long-term solutions that go beyond short-term rationing.
Canada’s farmers and agribusinesses are among the most productive and competitive in the world, but they depend on an efficient, reliable transportation system to succeed. Without it, we risk losing our competitive edge in the global marketplace. The government must act decisively to address these rail service failures, before it’s too late.
Canada’s agricultural industry, our nation’s economic backbone, deserves better than the status quo. We cannot afford to allow continued rail service disruptions to erode the trust we’ve built with our international buyers and partners. This is a crucial moment for action—Canada’s farmers and agribusinesses are depending on it.
— Learn more about the work of the Ag Transport Coalition at agtransportcoalition.com
