As harvest operations begin across the prairies, CN Rail is monitoring the impact of weather on the harvest and working with customers as it prepares to ramp up grain movement.
David Przednowek,Vice President of Grain for CN Rail says with the seasonal decline that they usually see in shipping, they move some of the hopper car fleet into long-term storage, and it's time to bring them back out and get them ready to roll.
"Harvest has had a hard time getting started with the way the rains have been going through," said Przednowek. "Cooler, wetter weather in some areas has delayed crop maturity, which could actually benefit crop filling in regions where it matters most."
This slow start has led to a noticeable dip in grain shipment volumes through August. According to Przednowek, the decline is largely due to historically low carry-in stocks. "The trade and market participants have done a good job drawing those stocks down," he explained. "Now, it’s all about waiting for harvest to come on to recharge the pipeline. It’s up to the new crop to drive volumes and prime the pump."
CN Rail is working closely with customers to assess demand signals, but the pace of shipments will depend on the weather and the harvest. Przednowek notes "It’s been a choppy and slower onset than expected, and it really comes down to crop maturity and harvest conditions."
He says in the meantime, they are focusing on their strategic approach to asset deployment. "Ideally, you want a steady ramp-up in demand, it makes it easier for everyone," he said. "When it’s slow like this, you’re just parking trains under the spout at the elevator where you think and the customer thinks harvest is going to come on so you can fill trains."
The company also faces logistical challenges in reactivating its hopper car fleet. "Theres a lot of assets (hopper cars) sitting at customer facilities and elsewhere just waiting for harvest to come on. We’ve got cars in long-term storage that weren’t needed during the slower months. Those need to be inspected and pulled out, which is a key part of managing the ramp-up efficiently."
He says as the harvest progresses, CN Rail is poised to respond quickly. "If the weather cooperates, we’ll see a sharper and more severe ramp-up in shipments."