Grain shipments exceed those CN promised Ottawa prior to federal
government's order-in-council stipulating minimum volumes
MONTREAL, May 28, 2014 /CNW Telbec/ - CN (TSX: CNR) (NYSE: CNI) said
today its transportation of Western Canadian grain in the 2013-2014
crop year has now surpassed its prior historical record and exceeds
what it promised the Canadian government in mid-February, a full month
before the government's order-in-council took effect requiring railways
to move specific volumes.
CN's hopper car deliveries to Western Canadian grain elevators in May
are expected to average 5,500 carloads per week -- a full 50 per cent
more than the eight-year historical average, and 38 per cent more than
the best-May ever.
Claude Mongeau, president and chief executive of CN, said: "I wrote to
Agriculture Minister Gerry Ritz in February when emotions started to
boil in the midst of the brutal polar vortex that hobbled the
operations of all railroads. This was a month before Ottawa's
order-in-council was announced, and I promised the minister that CN
would move 4,500 carloads of grain per week as soon as extreme cold
weather abated, rising to 5,500 cars per week after the Port of Thunder
Bay opened for business.
"We have done exactly what we promised, without the need for regulatory
intervention. In fact, the strength of our grain transportation
performance is unprecedented. With our rapid rebound since March, and
our solid performance last fall before winter took a toll on
operations, we are on course to break all records for Canadian grain.
Crop year-to-date, CN's grain volumes are four per cent better than its
previous best and 13 per cent above average performance. And we would
have been closer to 10 per cent above our prior record if it hadn't
been for grain companies failing to use available rail capacity last
August and early September when it was becoming clear that Canadian
grain growers would harvest a huge crop."
Mongeau said CN is now aiming to move close to 6,000 hopper cars of
grain weekly during this summer with its recently-introduced customer
fleet integration plan, and the deployment in Canada of its temporarily
surplus fleet of hopper cars used in U.S. service during the next three
months.
"Assuming grain elevator companies are capable of consistently unloading
this increased volume, these plans should propel us into even greater
record territory by the end of the crop-year in early August. With
solid supply chain collaboration, we expect to see a crop carry-over of
grain in the range of 18 million tonnes, which would be only about six
million tonnes above the average despite a massive 100-year crop."
Agriculture Canada is also projecting a carry-over of grain of 18.5
million tonnes and calling for a crop of about 62 million tonnes next
year, slightly above trend-line average and well below 76 million
tonnes in the current crop-year. If these forecasts prove to be
accurate, this will lead to another year with high stocks of grain to
move in 2014/15.
Mongeau concluded: "True supply chain collaboration and normal
commercial alignment -- not ill-advised and unwarranted regulation as
contemplated by the federal government -- is what we need to help
deliver this significant volume efficiently to the benefit of Canada's
grain-growing sector."
CN (TSX: CNR) (NYSE: CNI) is a true backbone of the economy,
transporting approximately C$250 billion worth of goods annually for a
wide range of business sectors, ranging from resource products to
manufactured products to consumer goods, across a rail network spanning
Canada and mid-America. CN - Canadian National Railway Company, along
with its operating railway subsidiaries -- serves the cities and ports
of Vancouver, Prince Rupert, B.C., Montreal, Halifax, New Orleans, and
Mobile, Ala., and the metropolitan areas of Toronto, Edmonton,
Winnipeg, Calgary, Chicago, Memphis, Detroit, Duluth, Minn./Superior,
Wis., and Jackson, Miss., with connections to all points in North
America. For more information on CN, visit the company's website at www.cn.ca.
Forward-Looking Statements
Certain information included in this news release is "forward-looking
statements" within the meaning of the United States Private Securities
Litigation Reform Act of 1995 and under Canadian securities laws. CN
cautions that, by their nature, these forward-looking statements
involve risks, uncertainties and assumptions. The Company cautions that
its assumptions may not materialize and that current economic
conditions render such assumptions, although reasonable at the time
they were made, subject to greater uncertainty. Such forward-looking
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and unknown risks, uncertainties and other factors which may cause the
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Important risk factors that could affect the forward-looking statements
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SOURCE CN
