Farmers call for return of Canadian Wheat Board

Anyhoooooo. PT of Churchill and Omnitrax knew it's fate 8 years ago...

Days numbered for hopper cars.

Posted Apr. 17th, 2008 by Adrian Ewins

Almost 2,000 aluminum grain hopper cars have a one-way ticket to the scrap heap.

The federally owned aluminum cars have been scrapped at a rate of more than one a day so far this crop year, under terms of an operating agreement between Canadian National Railway and the federal government.

However, Mike Ogborn, managing director of Omnitrax Canada, which owns the Hudson Bay Railway to Churchill, says his company is interested in using some of those cars.

“We’d like to have the scrapping process stopped immediately and have a third party look at the cars to determine which are useful for movement between The Pas and Churchill,” he said.

About 450 aluminum hoppers have been disposed of since Aug. 1, 2007, according to figures from Transport Canada, representing 24 percent of the 1,902 aluminum cars in the federal fleet at that time.

That works out to more than 50 cars a month.

The aluminum cars, which all operate on CN lines, are considered by the rail company and the government to be unsuitable for service and beyond repair.

“They are reaching the end of their useful life from a safety point of view,” said Transport Canada spokesperson Maryse Durette.

“As a result, the government has accepted that these cars be taken out of service sooner rather than later.”

Omnitrax has made its views known to the minister of transport and officials of Transport Canada, but has received no positive response.

Most of the cars, which range in age from 30 to 32 years, have been out of service for the past two years and parked at various locations across West-ern Canada.

“Only a handful are left in service and they will be withdrawn and stored this year and eventually scrapped,” said CN spokesperson Kevin Framchuk.

All of the cars will be disposed of by 2012, as per the operating agreement signed between the railway and Transport Canada last year.

Some grain industry officials expressed concern about scrapping so many cars when railway service, especially on CN, is such a contentious issue.

“They are a smaller cubic capacity than desirable for grain, but they are capacity,” said Sinclair Harrison, president of the Farmer Rail Car Coalition. “It’s a shame to lose that.”

However, both CN and the federal government say scrapping the cars won’t reduce the overall capacity of the railway to move grain.

“Any capacity shortfall from the removal of these cars will be more than compensated for by a combination of upgrades to steel cars and increased operating efficiencies as laid out in the agreement,” said Durette.

Framchuk said the rail company is voluntarily increasing by 10 percent the carrying capacity of steel cars built after 1974 and is on pace to finish refurbishing 3,034 cars, as required by its operating agreement, this year, four years ahead of schedule.

He said the aluminum cars are obsolete and inefficient, carry less grain than steel cars and can’t be repaired or rebuilt due to the nature of their construction.

The estimated scrap value of the cars is about $10,000 each. The cars will be disposed of by CN, with proceeds going to the federal government.

While both Transport Canada and CN described the cars as being in poor condition and beyond repair, a Transport Canada document from six years ago painted a different picture.

According to that 2002 report, based on an inspection of four percent of the cars, Transport Canada estimated that 90 percent of them were in good condition and 10 percent were in average condition. By comparison, the steel cars were 57 percent good, 37 percent average and five percent fair.

Aluminum cars represented about 18 percent of the 12,490-car federally owned fleet at that time.

That report also estimated that the aluminum cars could be expected to have a useful life of 40 years. Since they were built in 1976-78, that means their useful life should last until 2016-18.

Days numbered for hopper cars - The Western Producer (external - login to view)

Is it 2012 or 2016-2018 yet?
GMO wheat is not a exportable item, or it soon won't be but it will be sold to the Canadian consumers.

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