As of week 38, or the week ending April 22, a cumulative 24.143 million metric tons of all grains have been unloaded at the western ports of Vancouver, Prince Rupert and Thunder Bay. This is the lowest cumulative volume reported for this week in four years, while just 493,500 metric tons higher than the previous five-year average (2012/13 to 2016/17).
At 19.530 mmt, receipts at West Coast terminals are the lowest in three years although remains just over 1 mmt above the previous five-year average, while Thunder Bay receipts are the lowest in four years and are roughly 242,000 mt below the five-year average.
Over the past five crop years, an average of 72.7% of total western terminal receipts were realized in the first 38 weeks of the crop year, or 73.1% of the crop year. This ranges from a low of 66.3% of total western terminal receipts realized in the first 38 weeks in 2013/14 to a high of 76.6% of western terminal receipts realized in the same period in 2015/16. The average five-year pace of unloads would project to total crop year receipts of 33.2 mmt, which would still be the lowest volume unloaded in four years.
This comes at a time when both railroads are trying to get back on track following a disastrous winter shipping season, while CN has nicely recovered from a brief halt in operations given the recent threat of strike.
As reported by the AG Transport Coalition, in week 38, CN Rail spotted 91% of the empty hoppers requested for loading at prairie points, the company's best weekly performance seen since week 3 and only the fourth week of the crop year where the company spotted 90% or more of the cars requested. At the same time, the company did not outright cancel any hopper cars for week 38, the first time since week 9, while cancelling 22,243 cars in total so far this crop year.
Focus has shifted back to CP Rail, following a superior performance over the course of the winter months. In week 38, CP spotted just 53% of the empty cars ordered for loading, matching the company's week 36 performance while close to its weakest performance shown over the crop year.
It is interesting to note that the problem does not lie with shipper demand, according to AG Transport Coalition data. As of week 38, hopper car demand is pegged at 324,251 cars for the coalition members, described as responsible for 90% of all prairie shipments. This volume is 1,557 cars or .5% lower than reported in the same period of 2016/17.
While both railways struggle to get back on track with grain, they face demand in every direction they look. CBC.ca reports that oil companies are looking to rail, given the lack of pipeline capacity. In today's piece titled Oilpatch, it said leaders wait desperately to ship more crude by rail with pipelines maxed out. The author noted that Alberta has rail terminal capacity for oil of 600,000 barrels/day, while is shipping only 100,000 barrels. It is suggested that the current rail backlog is expected to be cleared in the last half of this calendar year when oil companies are expected to benefit from increased service.
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