Many rural communities have watched their infrastructure disappear. Rail lines have been ripped out and country elevators demolished. But some have stemmed the loss by buying short-lines from the national railways and investing in producer car facilities.
Contrary to popular belief, producer cars are more popular than ever, says Ron Shymanski, chairman of Torch River Rail. The short line has been running in north-east Saskatchewan since they bought the line from Canadian Pacific (CP) in 2008.
Before buying the track, their record for producer cars shipped totalled 135. In 2014, they handled about 600 cars, Shymanski says.
And, with a new one million dollar producer-car loading facility in Choiceland, Shymanski thinks they’ve got the customer base to double that number.
In central Alberta, Battle River Railway has been running a short line since 2010. Ken Eshpeter, the chair and CEO of the short line, says they averaged about 550 producer cars a year when Canadian National (CN) owned the line, and their best years saw about 800 producer cars.
“Last year we moved 2,100 cars. And this year we could move 3,000 cars,” says Eshpeter. Battle River Railway is working on its third producer loading facility. Eshpeter thinks they could move 5,000 to 6,000 cars of grain within a couple years if they knew they could get the cars.
One reason Battle River Railway shareholders formed a co-op and bought the 50-mile short line was to staunch the infrastructure loss, Eshpeter says. Eshpeter notes 25 elevators used to line 60 miles of that track. Today one elevator stands alone on the line, which runs south-east from Camrose to Alliance.
Grain handling and transportation infrastructure has consolidated since Quorum Corporation began monitoring the system 15 years ago. Since then, Western Canada has lost 9.6 per cent of its rail network, which now stands at 17,600 route-miles, according to Quorum’s latest report on the 2013-14 crop year. Eshpeter says that although that number may sound small, losing those short lines and sidings had a huge impact on rural communities.
In the same time period, 618 elevators vanished from the Prairie landscape, a loss of 61.6 per cent of the facilities, Quorum noted in the report. The 386 facilities that stand today hold just under 6.9 million tonnes, a storage capacity close to what the smaller, more numerous elevators held when Quorum began reporting years ago.
But Choiceland’s infrastructure has grown, Shymanski says. The producer car loading facility and short line employ four full-time staff.
“I think we run a fairly efficient operation the way it’s set up because we have the same people that run the railroad, load the cars, rather than have a train crew that brings out the cars and then they sit and wait ‘til the cars get loaded,” says Shymanski. “Our guys do everything.”
Farmers are allocated bins to load their grain using a key-lock system, Shymanski explains. Staff then move grain from the bins onto the cars.
“It’s just like going to the gas pumps with a card lock. They can haul 24 hours a day, seven days a week,” says Shymanski. He adds they now move far more cars from non-shareholders than the short line’s shareholders. Farmers from communities as far as 150 km away haul their grain to Choiceland, he adds.
The producer car facility’s popularity is no mystery. Short lines are one way for farmers to improve their bottom lines, Shymanski says. Torch River Rail’s facilities are working well and their rates are far lower than what they would be at a terminal, he says.
Torch River Rail’s grain flows south, for the most part. Quaker takes oats from the short line. Bunge, CWB’s Mission Terminal and Andersons Grain Group are also customers.
Last year’s transportation issues “put a kink into the whole plan because we were set for a terrific year,” says Shymanski. He says they had several cars booked and lots of interest from producers. “We really started a fire here. But it kind of started smoldering when… we couldn’t get the cars or weren’t getting cars to meet demand.”
The order-in-council promoted east-west traffic, he adds, and hurt southbound traffic. But overall things are going well with the short line and new facility, he says.
Battle River Railway is relatively close to Vancouver. The order-in-council negatively affected them, but they weren’t hurt as much as Saskatchewan short lines further from port, Eshpeter explains.
Eshpeter says the short line did eventually get cars, but they came a lot later in the year. Battle River Railway’s interior B.C. market was most affected.
“We got no cars for 27 consecutive weeks to deliver grain to that market,” he says.
The short line’s Alliance and Forestburg facilities clean and market peas. Battle River Railway also ships wheat and canola, and runs a tourism operation on the line. They also pull some oil, the idea being to intersperse the oil cars with grain.
“But in a way, it’s caused a real hassle because we never are spotted the number of cars that we actually ordered of grain cars for any particular run,” says Eshpeter. “It’s always a surprise.”
But despite the challenges of running a short line, Eshpeter is glad shareholders were able to buy the track. The short line cuts time spent hauling grain, employs locals, and keeps about $2 million in the community each year, Eshpeter says. It gives people a sense of ownership, he says.
And it works for farmers, he adds. “If we can figure out a way, as a group of farmers, to work together, I’ll continue to haul my grain in producer cars. I’ve done it most of my life. And we can seek out markets that work for us. And we can bring the benefits back to the farmers.”
While big companies look at the dollars and cents of infrastructure, “we look at it from a lifeblood perspective,” says Eshpeter.