Floods in British Columbia over the weekend are wreaking havoc on Canada's two major railways whose service to Western Canada is temporarily suspended due to washouts along their main rail lines.
Both Canadian National Railway Co. and Canadian Pacific Railway Ltd. said their rail network in the B.C. interior has been out of service since Sunday following heavy downpours and mudslides.
Executives from both companies told an investor conference hosted by the Bank of Nova Scotia on Tuesday that rail engineers are "battling" trying to get their rail network operational again.
"We're still sort of uncovering what it all means, but certainly that's our busiest corridor out in that region," said CP Rail Chief Marketing Officer John Brooks. "Time will tell but they're battling trying to get our main line back opened up."
Brooks added that service outage is hurting all of CP’S commodity shipments and specifically pointed to how its grain shipments - already under pressure this year following drought conditions - will be impacted by the rail washout.
He noted that some of its shipping lines, specifically potash, have been diverted to other western ports that haven't been affected by the floods. A CP Rail spokesperson said the outage is located north of Hope, B.C., about 120 kilometres east of Vancouver.
CN Rail Chief Operating Officer Rob Reilly said the company's rail line is expected to be out of commission for "a couple more days" as engineers look to repair the tracks. He described the current situation as a "hiccup" and is viewed internally as a "short-term challenge.”
"Quite frankly, we'll probably be out a couple more days," Reilly said.
"We've got some significant spots and it puts probably both railroads out for that period of time. The volume will still be there. So then it'll look to recover the railroad over the next several days coming out of that."
CN Rail Chief Executive Officer JJ Ruest told investors that the current outages represent about five per cent of the total railroad's shipping volumes in the quarter, but said the company could make up any lost revenue by raising some of its shipping prices to move cargo within Western Canada.
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