Rail freight rates for moving western Canadian grain to market will be going up in the 2019-20 crop year.
The Canadian Transportation Agency has announced that the Volume-Related Composite Price Index (VRCPI) will be increasing at Canadian National Railway and Canadian Pacific Railway beginning Aug. 1.
The VRCPI is used to determine how much Canada’s railway companies can charge to move grain.
Citing higher operating costs for labour, fuel and materials, the transportation agency determined that CN’s VRCPI in the 2019-20 crop will increase by 1.82 percent over 2018-19 values.
CP’s VRCPI will increase by 3.7 percent, based on higher costs for fuel, materials and investments including leased hopper cars, amortization and the cost of capital.
It remains to be seen how much extra the adjusted VRCPI values will cost grain shippers to move western Canadian grain to market.
