Much-needed Canada grain piles up amid rail bottleneck

The world sorely needs more grains and Canada has a bin-busting harvest this year -- but shippers fear there aren’t enough rail cars to transport it all.

There were almost 2,400 outstanding grain-car orders for the nation’s two major carriers, Canadian National Railway Co. and Canadian Pacific Railway Ltd., according to the latest data from the Ag Transport Coalition. That’s the worst backlog since flooding blocked access to Vancouver’s port in late 2021, stranding wheat and canola in the Prairies. 

“We have to make up these orders,” Wade Sobkowich, executive director of the Winnipeg-based Western Grain Elevator Association, said Tuesday in a phone interview. “We were concerned going into this year and unfortunately it feels like our concerns are founded.”

Shippers are worried about the railways’ ability to haul grain as Canadian farmers harvest the nation’s third-biggest wheat crop on record and 42% more canola than a year ago. Sobkowich said Canadian Pacific has fallen behind orders for three weeks and grain companies will have to defer sales if the trend continues.

“CP is working diligently with grain customers,” spokeswoman Salem Woodrow said in an email, noting the railway supplied more than 6,500 hopper cars last week and shipped 709,342 metric tons of grain and grain products, a 10% increase from a week earlier.

CN spokesman Jonathan Abecassis said a two-day washout on a section of the railway’s network disrupted certain supply chains, but the company has resources in place to move anticipated grain volumes over the course of the current crop year, according to an emailed statement.

Canada’s harvest rebound comes as world grain supplies have been uncertain following the war in Ukraine. Transport woes are also hampering the US crop as drought is drying up the Mississippi River, resulting in fewer barges to move corn and soybeans.