CP sets grain shipment record in October

Nov 09, 2018

The railway shipped more than 2 million metric tonnes of grain during the month

By Diego Flammini
Staff Writer
Farms.com

One of Canada’s national railways is celebrating a milestone achievement.

Canadian Pacific (CP) set a company record for the most amount of grain shipped in one month.

The railway transported 2.64 million metric tonnes of grain in October, making it “CP’s biggest month ever for moving Canadian grain,” CP said in a statement Tuesday.

Its previous record was about 2.34 million metric tonnes in September 2017.

Earlier in the year, the federal government mandated that CP and CN provide detailed plans on how to improve grain movement after a backlog last winter.

CP committed to investing around $500 million into 5,900 new hopper cars. About 500 of them will be in service by the end of the year.

The grain shipment record is an indication the railway’s plans are meeting the ag industry’s needs, said Joan Hardy, CP’s vice president of sales and marketing for its grain and fertilizer division.

“This accomplishment is a testament to the hard work and dedication of our operating team and the power of our operating model,” she said in Tuesday’s statement. “This requires laser-sharp focus on the supply chain details, and close collaboration with customers, elevators and ports. Together, through hard work and open communication, the system has been operating with maximum velocity and fluidity.”

The question now is if CP will be able to maintain this level of operation.

Setting records is great when there’s attention on the railway, but how it operates after the spotlight dims will be important, said Stephen Vandervalk, a wheat grower from Fort Macleod, Alta.

“They’re definitely doing a better job, but this always happens when something changes,” he told Farms.com. “They need to make sure they don’t fall back into an old routine in 18 months and we’re in the same (backlog) situation we were in before.”

Video: Will the 2025 USDA December Crop Report Be a Market Mover/Surprise?

Historically, the USDA December crop report is a non-event or another dud report as the USDA reserves any final supply changes to the final report in January of the following year in this case 2026. But after the longest U.S. government shutdown in history at 43 days and no October crop report will they provide more data/surprise and make an exception?
Our China U.S. soybean purchase tracker is now at 26.6% or a total of 3.2 mmt but for traders it’s taking too long to unfold.
The final Stats Canada production report was bearish canola and wheat projection a record crop in both (it adds to the global glut of supplies) and bullish local corn and soybean prices in Ontario/Quebec thanks to a drought. It will not help the fund flow short-term, the USDA may need to offset it?
A U.S. Fed interest rate cut of another 25-basis point next Wednesday (probability 87.1%) could help fund flow and sentiment in stock and ag commodities into year end.
More inflows into Bitcoin this past week saw prices rebound back above 90,000 with support at 82,000 and resistance at 96,000.
A V-shaped bottom in cattle suggest the lows are in after Mexico reported another new world screwworm case. Lower weights, seasonal demand and higher U.S. beef select/choice values with a continued closure of the Mexican border to cattle will result in a resumption of higher cattle futures into yearend.
Australia is expected to produce its 3rd largest wheat crop ever at 36 mmt adding to the global glut of supplies.
Reports of ASF in hogs in Spain the largest pork exporter in Europe could see the U.S. win more pork export business long-term.
If the rains verify into next week of 3-5 inches for Brazil it would go a long way to fixing the dry regions from the last 2-months, but the European weather model has been wrong for the past 2-months!
Natural gas futures are surging to the 3rd price count as frigid hold temps set in.
CDN $ is also surging to end the week on a very resilient economy and better employment numbers suggesting no interest rate cuts next week.
Finally, the CFTC report showed funds were net buyers of soybeans but sellers of corn, canola and wheat. In real time the funds have gone back to selling as they take some profits.