Grain backlog still looms large as CN returns to normal service after strike

MONTREAL — Canadian National Railway Co. says service is back to normal less than a month after a strike brought it to a screeching halt, but big grain backlogs remain a concern for Western farmers.

Todd Lewis, president of the Agricultural Producers Association of Saskatchewan, says that “back-to-normal shipping won’t clear up the backlog” of some 10,000 hopper cars’ worth of corn, canola and other grains that built up during the eight-day labour stoppage.

Contract extension penalties and demurrage fees — issued by a shipping line when freight exceeds the time allotted at a terminal — remain a threat for farmers and grain elevators trying to clear out brimming barns and silos.

Wade Sobkowich, head of the Western Grain Elevator Association says the $130-million backlog of Prairie grain may lose much of its value if trains can’t ship it to port before spring, when prices typically drop amid heightened global supply.

CN chief executive JJ Ruest says he is pleased the company’s recovery plan is working and that train movements have recovered to “normal ranges” with safety top of mind as it continues to clear the backlog.

Resource industries are facing less dire backlogs. Canadian Propane Association CEO Nathalie St-Pierre says levels of the fuel in Central and Eastern Canada, where propane shortages loomed during the strike, are back up to 70 per cent, but called for a more efficient return to full capacity to safeguard against problems during the cold winter months.

This report by The Canadian Press was first published Dec. 20, 2019.

Companies in this story: (TSX:CNR)

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