MONTREAL — Canadian National Railway Co. executives say wildfires and tariff threats are unlikely to do major damage to shipping volumes this year, after the country’s largest railway beat earnings expectations for the quarter and raised financial projections for 2026.
CN said tracks in northwestern Ontario have now reopened after shutting down for more than a week due to wildfires that forced one crew to flee on foot and traffic to be rerouted through the United States.
“Our mainline in northern Ontario is open at this point, and we currently do not expect a significant impact to our business,” chief operating officer Patrick Whitehead told analysts on a conference call Friday.
Federal authorities are looking into whether CN failed to comply with the Railway Safety Act after a train near Armstrong, Ont., was engulfed in flames last week.
“The safety of our employees and of the communities we operate through is our first area of focus,” said CEO Tracy Robinson.
On the tariff front, she held out hope that U.S. President Donald Trump’s latest tariff proclamations — a 50 per cent duty on a raft of Canadian goods set to take effect Aug. 19 — would resolve in a “constructive agreement” between the U.S., Canada and Mexico.
“What we’ve embedded in our guidance as we look forward is a tariff level that looks a lot like what it is right now,” Robinson said.
The railway raised its full-year guidance Friday, forecasting mild volume growth versus the flattish figures predicted six months ago. It also now expects adjusted diluted earnings per share growth in the mid-to-high single digits instead of the low single-digit range.
The more optimistic outlook comes after CN raked in revenue from oil as well as grain and fertilizer shipments in its second quarter.
Revenues soared 16 per cent year-over-year for petroleum and chemicals and 18 per cent for grain and fertilizer. The two categories alone accounted for 42 per cent of CN’s freight revenues.
The price of petroleum and some fertilizers have spiked since late February amid supply bottlenecks brought on by the Middle East war, which helped push CN’s potash volumes to record second-quarter levels. A bumper crop also delivered record shipments of Western grain, the company said.
So far, importers and exporters have avoided rushing to ship products across the border to beat Trump’s threatened tariff deadline next month.
“Broadly speaking, no, I don’t think we’ve had a whole lot of pull-forward,” said chief commercial officer Janet Drysdale.
On Friday, Robinson addressed a deal that CN struck earlier this week with Union Pacific Corp. that would end the Montreal-based company’s opposition to its rival’s proposal for a massive merger south of the border.
The agreement would hand CN more network access in the U.S. Midwest in exchange for its tacit support of Union Pacific’s proposed US$85-billion acquisition of Norfolk Southern Corp. The settlement is contingent on the merger’s approval by American regulators.
“We’ve been talking a lot about the need for more competition,” Robinson said. “So as we’ve come to this agreement, we are satisfied that we’ve mitigated much of that concern.
“We won’t have a large voice in the merger considerations as we go forward,” the CEO added.
CN said it spent $34 million in advisory fees related to the would-be acquisition in the first six months of the year.
Competitors and customers worry the merger would cost shippers — and ultimately consumers — as well as placing unprecedented market power in the hands of a single railway, which would handle some 40 per cent of American freight traffic.
Union Pacific and Norfolk Southern argue that getting hitched would slash costs and prompt rivals to lower their rates to compete.
A second deal with Union Pacific announced on Wednesday would also give CN a quicker route between Mexico and Canada, as CN locomotives rev up to roll on UP tracks between Memphis, Tenn., and the Rio Grande.
“Whereas previously CN’s access to Mexico was via other railroads, now CN will be able to directly work with its Mexican partner Ferromex” — that country’s largest freight railway — said National Bank analyst Cameron Doerksen in a note to investors.
The company hopes to win new automotive, container and commodities business as a result, Robinson told analysts. But rival Canadian Pacific Kansas City Ltd. may yet have the upper hand on hauls between the two countries.
“We still see CPKC in a more advantaged position given that it enjoys its own network in Mexico (i.e., does not have to work with a partner) and also does not need to rely on connections,” Doerksen said.
On Friday, CN reported that net income increased seven per cent year-over-year to $1.25 billion for the three months ended June 30. Total revenues jumped 11 per cent to $4.75 billion from the same period a year earlier on higher fuel surcharges as well as the income from oil, grain and fertilizer.
On an adjusted basis, CN earned $2.08 per diluted share in its latest quarter, up from $1.87 per diluted share a year ago and far outpacing analysts’ expectations of $1.96, according to LSEG Data & Analytics.
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Christopher Reynolds, The Canadian Press
This report by The Canadian Press was first published July 24, 2026.
