The situation facing Canadian grain farmers is almost Biblical. Their 2013 crops of wheat, canola, barley, and other grains was 40 percent greater than that of 2012 and far above average. Moreover, the harvest was a bountiful surprise forecast by almost no one.
Now a new year is underway and it seems that the greater part of that harvest remains trapped in grain elevators or, worse yet, unsold and sitting in the granaries of prairie farmers. Canadian farmers and its two major railways, it seems, all labor under a winter unlike any in recent times. Trains are cut to half their normal sizes to keep air brakes functioning in sub-zero climates. The coin of the realm in railroading, locomotives and crews, is spent.
It’s enough to lead one to prayer. Better yet, to Ottawa.
Yes, the Canadian government has decided to do what King Canute wisely declined to do, which was order the tide to quit rising. The governing Conservative Party’s transport minister. Lisa Raitt, ordered Canadian National and Canadian Pacific to effectively double their rates of grain car loading within a month or face $100,000-a-day penalties (which sounds like a lot but really is not).
This is the age-old story of Canada and the U.S. prairie states. God gives a bountiful harvest, then takes away in a winter for the ages, and railroads are left to answer for it.
The U.S. secretary of transportation, Anthony Foxx, is too wise to play the courtier to King Canute and demand railroads to do what nobody can do. Canada’s transport minister doesn’t have that luxury, the political pressure from farmers being what it is, so she ordered the tide to quit rising. With spring on the doorstep, the railroads may be able to do the near-impossible. However, I am told more than 40 grain trains are already on CP tracks inside Canada, and I cannot imagine 40 more of them having any effect other than to make the wheels turn slower and slower. Were I Claude Mongeau (CN) or Hunter Harrison (CP), I would tell my people to do all they can within the limits of their capabilities to move the grain to ports, but not to do so much that they clog the railroad and make it totally dysfunctional. A railroad so plugged with cars and trains that nothing moves (see Union Pacific in 1997 and 2004 and, for that matter, BNSF Railway’s northern transcon in 2014) is worse than no railroad at all.
CN and CP say they’ll do their best, but the bottom line is this: A penalty of $3 million a month is a small price to pay for a fluid railroad. — Fred W. Frailey
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