Canada Markets

As of week 20, or the week ending Dec. 22, the Ag transport Coalition reports the total hopper car demand from shippers at 176,952 cars, up 2,949 cars or 1.7% from the same period last crop year. This bears watching, given that the most recent supply and demand tables for December forecasts exports for Canada's principal field crops at 50.975 million metric tons, down 1.943 mmt or 3.7% lower than the volume reported for 2018-19.

When compared to the three-year average for this period, the current demand is only 1,049 cars or 0.6% lower, which range from a low of 173,998 cars to a high of 180,897 cars over the 2016-17 through 2018-19 crop years.

So far this crop year, Canada's two major railways combined have supplied 95.4% of the cars wanted for loading, or 168,755 cars of the 176,952 cars ordered. While this is below the 96.5% achieved over the same period in 2018-19, more cars have been spotted this crop year due to the increased demand for hopper cars for loading.

The attached chart shows the unfulfilled demand, which consists of outstanding orders, rejected cars, railway cancellations and shortened supply, as reported for the six primary shipping corridors. This is shown for 2019-20 (blue bars) as compared to the previous crop year (grey bars) and the three-year average (brown bars).

The current unfulfilled demand as of week 20 totals 8,197 cars, of which 5,360 cars or 65.4% is due to CN cancellations linked to that company's strike. As of the same week in 2018-19, the unfulfilled demand totaled 6,184 cars, with cancellations by both railways totaling 2,118 cars, while on average over three years, the unfulfilled orders totaled 9,626 cars, with cancellations averaging 4,959 cars.

When the year-over-year data is considered, the poorest performance is seen at the Port of Prince Rupert, served solely by CN Rail. Unfulfilled demand totaled 1,803 cars as of week 20, 1,293 cars higher than the same period in 2018-19. The best performance can be seen in the United States/Mexico corridor, with unfulfilled shipper demand totaling 100 cars, down from 438 cars reported this time last crop year.

Unfulfilled demand for the largest shipping corridor, or the Vancouver Bulk corridor, totals 3,515 cars, just 142 cars more than reported for the same period in 2018-19.

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