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Canadian Railroads > Breakdown of CN & CP Grain to Vancouver, Rupert, T Bay, E Canada


Date: 01/02/19 22:38
Breakdown of CN & CP Grain to Vancouver, Rupert, T Bay, E Canada
Author: Marcus

The Canadian Transportation Agency (CTA) has released information
on the movement of Western Canadian grain, which is regulated.

Western Canadian grain is defined by the CTA as originating West of Thunder Bay or Armstrong, Ontario,
and destined for Eastern Canada, export at Thunder Bay, Ontario,
export at Churchill, Manitoba, or export through a British Columbia port.
Excluded is exports to the United States for U.S. consumption.

The market share for both railways was exactly the same as the previous year.


Metric tonnes for the crop year August 1, 2017 to July 31, 2018

To Vancouver
CN = 11,197,003
CP = 13,795,623

To Prince Rupert
CN = 5,542,416
CP = 0

To Thunder Bay
CN = 2,287,164
CP = 4,697,699

To Eastern Canada
CN = 1,924,275
CP = 1,174,105

Zero moved to Churchill, Manitoba

Average Length of Haul
CN = 1007
CP = 896

Totals
CN = 20,983,547 ( 51.7% vs. 51.7% previous year)
CP = 19,634,738 ( 48.3% vs. 48.3% previous year)

Grand Total
40,618,285
Six percent lower than previous year.

https://www.otc-cta.gc.ca/eng/ruling/r-2018-276

Both railways exceeded the maximum revenue entitlement
as defined by the Canadian Transportation Agency,
by over one million dollars each.
They are ordered to pay the overcharge, plus a five percent penalty,
to the Western Grains Research Foundation.

 



Edited 2 time(s). Last edit at 01/03/19 07:46 by Marcus.



Date: 01/03/19 00:51
Re: Breakdown of CN & CP Grain to Vancouver, Rupert, T Bay, E Can
Author: aronco

Will someone please explain what the "excess revenue" figures mean?  Is that some convoluted means of controlling grain shipping rates, a la Crowsnest Pass rates of years ago?

Norm

Norman Orfall
Helendale, CA
TIOGA PASS, a private railcar



Date: 01/03/19 01:40
Re: Breakdown of CN & CP Grain to Vancouver, Rupert, T Bay, E Can
Author: railsmith

aronco Wrote:
-------------------------------------------------------
> Will someone please explain what the "excess
> revenue" figures mean?  Is that some convoluted
> means of controlling grain shipping rates, a la
> Crowsnest Pass rates of years ago?

Yes, that's exactly what it is.

The Crow Rate was repealed in 1983 by the Western Grain Transportation Act. But the government then subsidized the railways to the tune of $600 million per year to keep the grain shipping rates down.

In 1995, as the government strove to reduce its annual deficit, that subsidy was eliminated and replaced with the current regime that sets a cap on the maximum amount the railways can earn (the maximum revenue entitlement, or MRE), which is calculated annually.  Since 2000, any "excess" above the MRE plus a 5% fine is paid to the Western Grains Research Foundation.

Under amendments to federal transportation law passed in 2018, the formula for calculating the MRE has been changed in line with lobbying by the railways. From now on, the calculation of MRE will take into account capital spending by the railways on equipment used in hauling grain.

One immediate effect of that change is that both CN and CP have placed substantial orders for new grain hoppers that will eventually replace the fleet purchased by the federal government back in the day when the Crow Rate was still in effect (and the railways back then not willing to renew their own fleets as a result). There have been several posts to Trainorders about these new cars on both CP and CN.



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