Railway Carloadings Increase in August

(Statistics Canada)

The Canadian railway industry saw an increase in cargo loadings in August, as traffic originating on domestic railways as well as traffic received from American railways rose. Total rail freight traffic increased to 25.1 million metric tonnes in August, up 19.6% from the same month last year.

Freight loadings originating in Canada rose 18.1% from August 2009 to 22.6 million metric tonnes. The industry's core transportation systems, non-intermodal and intermodal, both contributed to rise.

Non-intermodal freight loadings, which are typically carried in bulk or loaded in box cars, rose 18.0% from August 2009 to 20.1 million metric tonnes. The commodity groups that saw the largest increases in tonnage were iron ores and concentrates, potash and iron and steel (primary or semi-finished). While the loadings of a majority of commodity groups rose in August, a number of groups registered declines. Those with the largest decreases were lumber, other cereal grains and wood pulp.

Intermodal freight loadings, which involves transporting freight through containers and trailers loaded onto flat cars, increased 18.6% from August 2009 to 2.4 million metric tonnes.

Rail freight traffic received from the United States rose to 2.5 million metric tonnes in August, up 34.7% from August 2009. The increase stemmed largely from non-intermodal freight loadings, which rose 37.3%.

From a geographic perspective, 53.6% of the freight traffic originating in Canada was loaded in the Western Division of Canada, with the remainder loaded in the Eastern Division. The Eastern and Western Divisions, for statistical purposes, are separated by an imaginary line running from Thunder Bay to Armstrong, Ontario. Freight loaded at Thunder Bay is included in the Western Division while loadings at Armstrong are reported in the Eastern Division.

CN Rail Stoppage Averted, Contract Agreement Reached

(Courtney Tower — BarCode Border)

CN Withdraws Work Rules Threat

A threatened strike or lockout in the Canadian National Railway system is off. Late Friday, a tentative three-year collective agreement was reached with 2,700 operating employees, who still must vote to ratify it.

After a week of last-ditch negotiations in Montreal, CN withdrew demands to eliminate two sets of jobs and from its announced plan to impose new work rules on the workers starting Monday. Contract talks had broken off last spring in what a federal conciliation commissioner, in a scathing report blaming both sides, called an atmosphere of “dysfunctional” relations.

CN briefly announced Friday night that it “will have labor stability with this group for the next three years,” but gave no details. However, Bryan Boechler, a spokesman for Teamsters Canada Rail Conference, representing the conductors, trainmen and switching yard workers, told The Bar-Code Border that CN's imposition of new work rules was “off the table.” CN President Claude Mongeau had written to all these employees with this threat if the union would not agree to a new contract.

Read more at The Bar-Code Border.

Railway Carloadings Up in July

(Statistics Canada)

The volume of cargo carried by Canadian railways rose in July, as both commodity loadings in Canada and traffic received from the United States increased.

Total freight traffic originating in Canada and received from the United States rose to 24.7 million metric tonnes, up 19.6% from July 2009. Compared with July 2009, freight loaded in Canada increased 17.4% to 22.3 million metric tonnes in July. The Canadian railway industry’s core transportation systems, non-intermodal and intermodal, both contributed to the rise in cargo loaded.

Non-intermodal freight loadings, which are typically carried in bulk or loaded in box cars, rose 18.5% to 19.9 million metric tonnes. The commodity groups with the largest increases in tonnage were iron ores and concentrates, potash and iron and steel (primary or semi-finished). In contrast, several commodity groups registered declines. Loadings of lumber led the way, followed by wood pulp and other cereal grains.

Intermodal freight loadings, transported through containers and trailers loaded onto flat cars, increased 8.3% to 2.3 million metric tonnes in July, compared with the same month the previous year.

Rail freight traffic coming from the United States rose to about 2.5 million metric tonnes in July, up 44.3% from July 2009. Non-intermodal freight transported from the United States contributed to the increase.

From a geographic perspective, 55.3% of the freight traffic originating in Canada was in the Western Division of Canada, with the remainder loaded in the Eastern Division. The Eastern and Western Divisions, for statistical purposes, are separated by an imaginary line running from Thunder Bay to Armstrong, Ontario. Freight loaded at Thunder Bay is included in the Western Division while loadings at Armstrong are reported in the Eastern Division. Read more

Port Authority, CN Sign Pact to Boost Efficiency, Move More Cargo

(Montreal Gazette)

The Montreal Port Authority and Canadian National Railway Co. said Monday they have signed a framework pact aimed at raising the port’s efficiency and boosting its share of cargo shipped between Europe and Ontario and the U.S. Midwest. CN will benefit by carrying more cargo onwards. Read more here.

Railway Carloadings, March 2010

(Statistics Canada)

The volume of cargo carried by Canadian railways increased in March, as both commodity loadings in Canada and traffic received from the United States rose. Total freight traffic originating in Canada and received from the United States increased to 25.5 million metric tonnes in March, up 16.1% from March 2009.

Compared with March 2009, freight loaded in Canada rose 14.0% to 23.0 million metric tonnes in March. The Canadian railway industry’s core transportation systems, non-intermodal and intermodal, both contributed to the rise in cargo loaded.

Non-intermodal freight loadings, which are typically carried in bulk or loaded in box cars, rose 14.3% to 20.7 million metric tonnes. The commodity groups with the largest increases in tonnage were potash, coal, iron and steel (primary or semi-finished) and other metallic ores and concentrates. Read more here.

Port Calls for Commercial Approach in National Rail Freight Service Recommendations

(CanadaNewsWire)

In an effort to highlight the critical importance of rail service to the success of Canada’s Asia Pacific Gateway, Port Metro Vancouver is calling on Ottawa to implement a commercial approach to defining, measuring, monitoring and ensuring a high level of rail service. The Port proposed its recommendations on Friday in a detailed submission to the Transport Canada Rail Freight Service Review Panel.

“Optimal rail performance is a critical factor in achieving the Port’s goal to develop the most reliable and consistent supply chain in North America,” said Robin Silvester, President and CEO, Port Metro Vancouver. “We are confident that the Rail Freight Service Review will lead to meaningful and actionable recommendations for government’s consideration in its effort to maximize Canadian trade.”

Access the complete report here.

Domestic Intermodal Primed for Growth

(Journal of Commerce Online – Bill Mongelluzzo)

Rail likely to benefit as shippers cut transportation costs, carbon footprint

Domestic intermodal rail weathered the economic recession better than most transportation modes, and the industry appears now to be on the verge of experiencing unprecedented growth. The growth in domestic intermodal will be driven by shipper requirements to reduce transportation costs, improved reliability of intermodal services by all rail carriers and corporate America’s desire to reduce its carbon footprint.

“The changes are so profound I believe we are at an inflection point,” Brian McDonald, vice president of intermodal at Union Pacific Railroad, told the Los Angeles Transportation Club.

UP is a case in point. Domestic intermodal was the only sector of UP’s 40 commodity lines to grow during last year’s recession. In fact, UP handled a record number of domestic intermodal units in 2009.

Changing customer requirements will be a primary driver of domestic intermodal growth. Traffic managers are acting under a mandate to reduce transportation costs, and substituting domestic intermodal for over-the-road trucking is the quickest way to cut costs over longer distances, McDonald said. Read more here.

Obama’s Money Trains

(Journal of Commerce Online – John D. Boyd)

More than half of high-speed rail grants will go into freight corridors to build up inter-city passenger service

It took nearly a year and a stubbornly high unemployment rate before the Obama administration recast its long-awaited $8 billion in rail system grants as part of a jobs strategy.

But when the White House unveiled its list of winners for high-speed rail funding, to boost passenger train service between cities, it quickly became clear large parts of it would go into the freight rail corridors that also carry Amtrak trains.

For instance, of the 13 funding corridors that traverse parts of 31 states, just two would be true high-speed passenger lanes with “bullet trains” that would need their own walled-off tracks away from freight operations. Read more here.

Canada’s Railways Could Be Back on Track

(Materials Management & Distribution)

After hitting bottom in 2009, all signs point to a freight rail traffic upswing in 2010: RAC

Freight rail traffic may have hit rock bottom in 2009, but the Railway Association of Canada (RAC) says that 2010 looks promising. In a release sent out late last month, the RAC reports that freight carriers saw traffic drop by 25% during the first half of 2009. The RAC attributes the drop to the recession, which cut into the overseas demand for coal, sulphur and other export commodities, as well as the movement of containerized goods in and out of Canada.

But the RAC also notes signs of improvement. For one thing, toward the end of 2009 the number of locomotives and freight cars brought out of storage rose to handle an uptick in business. Also, strong demand for Canadian grain and specialty crops kept carriers busy during 2009. And there is plenty of promising new business for the railways, including ethanol and wood pellets used in electricity-generating plants. Read more here.

Canadian Rail Chief Sees Freight Recovery; ‘Confidence Issue’

(NASDAQ – Ann Keeton, Dow Jones Newswires)

Canadian National Railway Co. (CNI) is seeing steady monthly increases in business of 3% to 4%, causing Chief Executive Hunter Harrison to turn bullish for a gradual recovery for rail freight hauling. Still, he said, “I think it’s a confidence issue,” he told Dow Jones Newswires in an interview, adding that fear of spending and investing could derail a recovery.

The head of the Montreal-based railroad company spoke Monday at a transportation symposium at Northwestern University. As railroads recover from a 20% downturn, they need to plan in the long term for adding capacity, he said.

Expansion from adding track likely won’t happen, because that’s too costly, he said. But railroads could become more efficient through mergers, Harrison said. As well, railroads should consider “open access” for some markets, where customers could decide with which freight hauler they want to work. That railroad would pay fees for access to a competitor’s track. Read more here.

Railway Carloadings, August 2009

(Statistics Canada)

The Canadian railway industry saw a decline in the volume of cargo carried in August, the result of a drop in commodities loaded in Canada as well as traffic received from the United States.

Total freight traffic originating in Canada and freight received from the United States dropped to 21.2 million metric tonnes in August, down 16.8% from August 2008. This marked the lowest amount of traffic carried for the month of August in 10 years.

Freight loaded by the Canadian railway industry’s core transportation systems, non-intermodal and intermodal, accounted for the majority of the overall drop in cargo loaded. The industry loaded 18.8 million metric tonnes of cargo in August, down 17.0% from August 2008.

Non-intermodal freight loadings, which are typically carried in bulk or loaded in box cars, fell 16.9% to 16.7 million metric tonnes. The decrease was the result of reduced loadings in the majority of the commodity groups carried by the railways. The commodity groups with the largest declines by tonnage were iron ore and concentrates (down 1.2 million metric tonnes), potash, coal, and iron and steel, primary or semi-finished.
Links to the data files can be found here.

Railway Carloadings Down in May

(Statistics Canada)

The Canadian railway industry loaded 19.1 million metric tonnes in May, down 21.4% from the same month in 2008. The drop in tonnage was the result of decreased freight loadings in both non-intermodal and intermodal railway transportation systems.

Compared with May last year, non-intermodal loadings fell 22.0% to 17.0 million metric tonnes in May. The decline was widespread, as the majority of commodity groups registered decreased activity. Among the commodity groups with the largest declines in tonnage were potash, coal, iron ore and concentrates, iron and steel (primary or semi-finished), lumber and other cereal grains.

Although overall non-intermodal loadings fell in May, a number of commodity groups saw strong gains in tonnage loaded, including wheat, colza seeds (canola) and fresh, chilled or dried vegetables.

Intermodal loadings declined 16.4% from May 2008 to 2.1 million metric tonnes. The drop stemmed from declines in both containers and trailers loaded onto flat cars.

Rail freight traffic coming from the United States fell 29.4% from May 2008 to 2.0 million metric tonnes. Complete statistic here.

CP Rail Laying Off 600 Workers Temporarily

(CBC News)

Canadian Pacific Railway has given temporary layoff notices to 600 employees across the country.

The railway company, based in Calgary, blamed the looming economy for being forced to temporarily lay off staff.

Spokesperson Breanne Feigel said the cuts affect train operators, mechanical employees, and track maintenance staff in its workforce of 16,000.

“We are seeing a decrease in volumes as Canada's economy is impacted,” Feigel said.

“Some of our customers are looking to hold off, or have no need for commodities or products to move, and as a result that impacts CP as a contributor to the supply chain.”

Feigel said none of the employees are facing permanent job loss. And the company expects to start hiring some of them back within a few weeks as the economy picks up.

The railway is also looking at reducing travel expenses and cutting flex days for office staff. There is also a hiring freeze on management positions.

DHS Announces Security Standards for Rail Systems

(Department of Homeland Security)

The U.S. Department of Homeland Security (DHS) announced today [Thursday] regulations aimed at strengthening the security of the nation’s freight and passenger rail systems and reducing the risk associated with the transportation of security-sensitive materials.

“By striking a sensible balance of security guidelines with certain regulatory requirements, we’re enabling the rail and chemical industries to be stronger partners,” said Homeland Security Secretary Michael Chertoff. “The results are sound security measures without excessively burdening owners and operators.”

The Rail Security final rule will require freight and passenger rail carriers to designate rail security coordinators and report significant security concerns to the Transportation Security Administration (TSA). The rule also will codify TSA’s broad inspection authority. For freight rail, the rule will ensure the positive handoff of security-sensitive materials as well as establish security protocols for custody transfers of security-sensitive material rail cars between receivers of these materials that are located in high threat urban areas, shippers of these materials, and rail carriers.

To raise the level of security in the freight rail transportation sector ahead of the final rule, both TSA and the U.S. Department of Transportation (DOT) developed security action items, along with the freight rail industry, to reduce the risk associated with the transportation of Poisonous by Inhalation (PIH) materials. These measures have resulted in an overall risk reduction of more than 60 percent, well above the target reduction of 50 percent. PIH materials are potentially harmful and include essential chemicals like chlorine and anhydrous ammonia. PIH materials represent less than one percent of all hazardous materials rail shipments.The freight rail provisions of the rule will address the transport of security-sensitive materials by rail, from start to finish, including shipment handoffs, secure areas for transfers, and reporting of shipment locations to TSA.

The Rail Security final rule has been sent to the Federal Register for publication and is currently available at the TSA website.

CN Found in Breach of Service to Grain Shippers

(Today’s Trucking)

Four out of six grain shippers have been vindicated in their cases against CN Railway, which they claim has not been providing a adequate and reasonable level of service for the movement of Western grain for crop in 2007 and 2008.

The Canadian Transportation Agency ruled that CN did not fail to meet its obligations under the Canada Transportation Act for services to Canadian Wheat Board and Providence Grain Group Inc.

However, the CTA did side with North East Terminal Ltd., Paterson Grain, Parrish and Heimbecker Limited, and North West Terminal Ltd. in similar complaints.

“Our grain terminals are now struggling to get rail cars when we need them for our markets because CN’s program requirements have been so rigid and unworkable for us,” said GNP Transportation & Logistics manager Perry Pellerin. “As a result, none but the largest grain handlers with multiple elevators could fit within CN’s service model, which strongly favored those who can ship in large rail car blocks, week after week, to a single destination.”

In its ruling, the quasi-judicial agency determined that a performance benchmark should be applied as a basis for determining whether CN is providing the shippers proper levels of service, including the confirmation of the number of rail cars requested by the shipper, as the timeliness and predictability of railcar delivery. Read more here.

Canadian National Expands Network

(Cargonews Asia)

Canadian National Railway (CN) has inked a deal with the city of Joliet regarding CN's proposed acquisition of the major portion of the Elgin, Joliet and Eastern Railway Company (EJ&E).

The agreement resolves the concerns the city had related to quiet zones, operations, and communications surrounding the transaction.

The conditions of the negotiations are contingent upon approval of CN's proposal to acquire control of the EJ&E, which is being considered by the federal Surface Transportation Board (STB).

As stated in STB's draft environmental impact statement, the board has encouraged voluntary agreements between CN and communities.

CN has been actively engaged in the environmental review process and will participate in the public hearings later in the year.

RAND: Railroads May Not Be Able to Handle Increased Freight

(American Shipper)

The volume of U.S. freight is expected to double over the next 30 years, and a new study said while railroads have improved productivity in recent decades, continued incremental improvements may be insufficient to handle freight volume increases.

The study by nonprofit research organization RAND Corp. said, “Increased use of rail freight is seen as a way to accommodate increased volumes while minimizing congestion on the highway system. However, the U.S. railroad network consists of many fewer track miles than it did several decades ago, and there is concern that it has become congested and incapable of handling additional volume.”

“Concern about railroad capacity constraints appears to be justified. However, capacity is determined by many factors, including operating practices, signaling technology, and car availability, in addition to miles of track,” RAND said. “Given the complexity of the system, there isn’t enough information available today to determine whether rail performance is now stable, declining or improving.”

The report three areas for further research:

• Improved reporting and public dissemination of railroad system and performance statistics to support transportation policy.

• Continued examination of public and private cost tradeoffs between shipping freight by truck and by rail.

• Development of a national freight strategy that balances the private interests of the shippers and the railroads with the public interest associated with the relative social costs of different modes of freight transportation.

The study, The State of U.S. Railroads: A Review of Capacity and Performance Data, is available online at the RAND website.

Ottawa Orders CN Rail to Remove 12,000 Wheels

(The Canadian Press/AFP)

The federal government has ordered CN Rail to find and remove potentially faulty wheels from its trains.

The emergency safety directive from Transport Minister Lawrence Cannon comes after the Transportation Safety Board warned thousands of wheel sets could cause derailments. Since 2000, 15 derailments due to loose wheels have been reported in Canada, and at least two in the United States, Canada’s TSB said.

The potentially faulty wheel sets were assembled at a Canadian National’s Transcona wheel shop between April 1, 1998, and February 28, 2001. Of the 43,000 sets made in that period, up to 12,000 may remain in service in North America on some Canadian Pacific Railway, Canadian National Railway and U.S. freight cars.

The Transport Department says the October 15 deadline gives CN the time needed to track all the wheels on train cars throughout Canada. In issuing the order, Cannon said he wants to prevent any future derailments related to faulty wheels.

Farmers Should Get $72M Break on Freight Costs: CTA

(CBC)

The Canadian Transportation Agency has ordered a big change to the regulation of freight costs – a change that could mean $72 million in savings for Prairie farmers.

The change announced Tuesday to “revenue caps” – the maximum amounts that CP Rail and CN Rail can earn from grain shipping – means farmers will now pay $2.59 less for every tonne of grain they send to the port of Vancouver.

Biggar, Sask.-area farmer Rene de Moissac calculated that he’ll save about $5,000 this year on freight rates, but he also said he wonders how many years he was paying too much. De Moissac thinks farmers should lobby to get some of that money back.

Other observers, like Saskatoon-based commodity analyst Larry Weber, think farmers and grain companies should now lobby for an improvement in rail service. “My main concern is by lowering the rates, are we going to get any better service than we’re getting today?” he asked. “The service today is already dismal.”

The change reflects the fact that railways’ maintenance costs for hopper cars have decreased, the transportation agency said.

The president of the Farmer Rail Car Coalition, Sinclair Harrison, said years of lobbying by his group has finally paid off. “We felt that farmers were paying an excess of $3,000 per car too much,” he said. “This announcement by the CTA backs up everything we said for 12 years.”

The railways have said they will appeal the ruling.