Federal hopper cars are not for sale: Ottawa

The grain cars will remain in service until they have reached the end of their expected service life in 25 or 30 years

The Canadian government has no plans to sell its fleet of hopper cars.

Instead, the cars will remain in service until they have reached the end of their expected service life, in 25 or 30 years.

“There are no plans to sell the Government of Canada hopper car fleet, which is operated by Canadian National Railway Company and Canadian Pacific Railway Ltd. under operating agreements with the Government of Canada,” said Daphne Denis, press secretary to Transport Minister Marc Garneau.

“By 2044, all of the hopper cars in the Government of Canada fleet will have reached the end of their useful service life and will be retired, at which point the government fleet will no longer exist.”

The railways will continue to provide equivalent capacity for the cars taken out of service, Denis added.

The federal government bought 13,500 rail hopper cars from 1972-94 to carry western Canadian grain to export terminals.

Around 8,400 of them remained in service as of Dec. 31, 2016,.

The rest — about 5,000 — have been retired from service, destroyed or sold for salvage value.

Under past and current operating agreements, the federal government provides these hopper cars at no cost to CN and CP to transport regulated grain from the Prairies to ports at Vancouver, Prince Rupert, B.C., and Thunder Bay, Ont.

The railways are permitted to use the cars for domestic grain movement or for transporting other commodities when they are not being used to haul grain to export position.

When this occurs, the railways are required to pay an alternate use fee.

Earlier this year, both CN and CP announced plans to buy new, high-capacity hopper cars.

CN announced plans to purchase 1,000 high cube or jumbo hopper cars, while CP announced plans to purchase 5,900 cars over the next four years.

CP will remove federally owned cars from its fleet as new cars come online.

The timeline for eliminating all government cars from the CP fleet has not been specified.

Industry sources say other rail carriers could use government cars that are removed from service, including short-line railways on the Prairies.

However, Ottawa has not given any indication that government cars will be made available to other carriers.

Of the 8,370 cars that remain in the current government fleet, approximately five percent (420 cars) are scheduled for retirement from 2017-25, another 40 percent (3,350 cars) are scheduled for retirement in 2026 or 2027 and another 50 percent or more (4,200 cars or more) are scheduled for retirement from 2032-35.

By the mid-2040s, all of the hopper cars in the government fleet will be retired and the fleet will no longer exist.

The federal fleet does not include hopper cars owned by provincial governments or former Canadian Wheat Board cars that were included in the “commercialization” of former CWB assets.

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