If not for the recession that has battered the world economy for much of the past year, this might have been a troubled year on the grain transportation front.
The Canadian Wheat Board and exporters of non-board grains knew that they had a big crop to move and lots of sales opportunities as 2008-09 got underway.
What they didn’t know early in the crop year was whether they’d have the vital third component of a successful grain marketing year – transportation capacity.
As things turned out, that was no problem.
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The recession sent transportation demand from virtually every sector of the North American economy into a tailspin, enabling grain to come in and pick up the pieces.
Total loads on wheels among Class 1 railways across North America have been down by 25 to 30 percent this year, with only grain close to average.
Instead of scrambling for rail cars, motive power and lakers to move a bigger-than-usual crop, transportation has been way down on the board’s worry list.
“We’ve certainly been in more of a comfort zone when it comes to securing capacity,” said David Przednowek, senior manager of ocean freight and terminal operations for the Canadian Wheat Board. “If this had been a typical year, we wouldn’t be in this situation.”
As a result, the board is projecting 2008-09 export shipments will total 19 million tonnes.
That’s nine percent more than the previous year and the highest total since 1999-2000, when the marketing agency exported 19.3 tonnes.
The 2008-09 total includes 13.6 million tonnes of wheat, 3.7 million tonnes of durum, 1.5 million tonnes of malt barley and 250,000 tonnes of feed barley.
The board originally set an export target of 17.6 million tonnes for this crop year, but was able to take advantage of additional rail and vessel capacity due to the downturn in shipments of other bulk commodities to boost its shipments.
As of mid-June, canola exports were on pace to exceed 7.6 million tonnes, up from 5.7 million a year ago.
Exports of pulse crops are forecast by Agriculture Canada to be 3.2 million tonnes, up slightly from last year. Total exports of the major western Canadian grains, oilseeds and pulses could exceed 30 million tonnes.
Looking ahead, Przednowek said it’s likely the situation will be much the same when deliveries of the new 2009 crop get underway in late September.
“The availability of capacity in the fall will depend on the pace of the economic recovery, and I don’t think that’s likely to happen by the end of September,” he said.
