CN CHANGES WESTERN GRAIN RATES
Effective Aug. 1, Canadian National will implement a new western Canadian single-car grain freight rate scale for “regulated movement” of prairie grain to export positions.
The rate scale is 8.5 percent lower than maximum rate level permitted under the Canadian Transportation Agency for the 2000-2001 crop year. The railroad also made further rate reductions of up to $8.29 per ton off the distance-based rate level. CN said the rate reductions are needed to stay competitive with Canadian Pacific Railway.
CN has also created a program of incentive payments to efficient grain handlers. “Efficient performance by loaders and unloaders will be rewarded, and there will be penalties for non-performance — for example, demurrage for slow loading,” said Sandi Mielitz, CN’s vice president of commercial development.
Blocks of 25 cars or more qualify for incentive payments of $1 per ton; blocks of 50 cars or more qualify for incentive payments of $4 per ton; and 100 car-blocks qualify for $6 per ton incentive payments.
The railroad said these programs will produce the 18 percent reduction in CN’s western grain revenues that has been mandated for the 2000-01 crop year by the Canadian government.
Staged shipments, which occur when shippers ask CN to collect small numbers of grain cars from a variety of origins and assemble them over a period of time prior to delivery, will be assessed a $2 per ton extra. The railroad said it hopes that the charge will encourage shippers to develop their own storage facilities, instead of using the railroad’s infrastructure.