Slashing in half average turnaround times for rail cars between the Prairies and ports is a daunting target, according to grain industry observers.
Last week, CN president Paul Tellier told a Canada Grains Council luncheon he thinks the industry should agree to shoot for an 11-day turnaround time for cars.
In 1999, it took 21 days on average to take rail cars from the Prairies to Vancouver and back again, said Tellier.
A transportation economist at the University of Manitoba said it’s hard to argue with targeting faster turnaround times.
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“Certainly, it’s ambitious,” said Barry Prentice, director of the Transport Institute at the University of Manitoba.
But because there are so many different players in the supply chain between farm and ocean vessel, Prentice said it won’t be easy to co-ordinate a just-in-time system for grain.
“To have everything work like a Swiss watch is just not easy in this system,” he said, noting larger unit trains, called shuttle trains will improve speed.
Prentice thinks it would be tough to achieve an average of 11 days over the entire system.
“I guess it depends on where you start counting from,” he said.
Tellier argued grain should be as quick to move as other commodities handled by rail. But Prentice said grain, unlike other commodities, is a low-value haul with seasonal fluctuations in volumes and many different grades and types.
Prentice said Tellier’s goal is premised on using the size and efficiencies of high-throughput elevators and unit trains.
Yet, the grain industry is increasingly looking at the likelihood of having to segregate more products for food safety and marketing reasons, said Prentice.
Greg Arason, president of the Canadian Wheat Board, called Tellier’s goal a “very ambitious target” that could have implications for smaller points and branch lines.
Arason thinks incremental improvements in turnaround times might be a more reasonable approach. He agreed with Tellier that it’s possible to build consensus on transportation issues with small groups of grain industry executives, but the consensus falls apart when all parts of the industry are represented in a discussion.
“I think it’s just a matter of group dynamics,” Arason said.
Not impossible
Doug Campbell, a consultant and former CN and grains council official, said railways have long had the ability to cut turnaround times to find cost savings in the system.
“It’s not only possible, it’s mandatory that it happen. But we let industry politics destroy any chance that it happen,” said Campbell.
But negotiating changes to cut the time has been a harder task, he said.
“When it gets into the (industry) group meetings, it’s the United Nations,” Campbell said.
He said CN needs healthy feeder lines run by short-line railways to get grain from the country to its main line, or else it will lose more volumes to trucks, CP Rail and Burlington Northern railway.
A spokesperson for CP said both major railways are reading from the same page on the issues of cutting time and politics from the system.
“There’s nothing really new in his speech,” said Ian La Couvée. “I think they’re getting some new mileage on some old proposals.”
La Couvée said CP has also shown it can reduce cycle times through its MaxTrax program.
