The railway plans to order 5,900 new hopper cars over four years
By Diego Flammini
Staff Writer
Farms.com
Canadian Pacific Railway (CP) is investing over $500 million to equip its fleet with new grain hopper cars with larger capacities.
The railway plans to have 5,900 new cars on its tracks within the next four years. National Steel Car in Hamilton, Ont. will provide the cars, beginning with an initial order of 1,000 cars. About 500 of the cars will be in service by year end.
The new cars should be an improvement over the older ones.
Currently, Government of Canada hopper cars can hold 93 tonnes of wheat. CP’s new cars will hold 102 tonnes. The new cars will be three feet shorter, measuring in at 56 feet (17 metres) long.
These improvements equal a 16 per cent increase in efficiency per train, CP says.
“These new railcars will revitalize our fleet and help cement our status as an industry leader in grain transportation for decades to come,” Keith Creel, president and CEO of CP, said in a statement today.
Canadian National Railway is also investing in new grain cars, it revealed last week.
These investments hould spur the optimism of farmers who have witnessed the railways’ struggle to keep up with demands, said Wade Sobkowich, executive director of the Western Grain Elevator Association.
“This is good news,” he told Farms.com today. “The railways have the responsibility of providing railcars that are suitable for loading and have enough capacity for the grain sector.
“A lot of the hopper cars are old and at the end of their useful life. We find there are mechanical problems with them and sometimes they leak. So to get new equipment out there is definitely a positive thing.”
Provisions to the Maximum Revenue Entitlement (MRE) formula within Bill C-49 allowed for the railways to make these investments, Sobkowich said.
“The Canada Transportation Act legislates how much railways can earn on grain movement,” he said. “The railways said there was something within the MRE that discouraged them from investing in new hopper cars. That element of the MRE was changed in Bill C-49, so now we see the two railways announcing new railcar investments.”