Conference Board of Canada: Infrastructure Study

Canadian exports bound for Europe and Asia are increasing. A new report by the Conference Board of Canada, out Thursday, explores whether or not Canada’s rail-to-marine networks will be able to accommodate forecasted growth in freight rail volumes through 2025.

Volumes of Canadian exports bound for Europe and Asia will increase pressure on Canada’s rail and marine freight infrastructure. The objective of this report is to explore whether or not Canada’s rail-to-marine networks will be able to accommodate this growth through 2025. The report first details Canada’s recent and changing trade patterns in terms of commodities, their origins, and their destinations.

Conference Board of Canada
Building for Growth: Trade, Rail, and Related Infrastructure

Report At a Glance:
• Canada’s economy relies on commodity exports, and these commodities rely on rail to reach port.
• This report explores the ability of Canada’s rail-to-marine network to accommodate growth in freight rail by forecasting interprovincial freight rail volumes through 2025.
• Growth in rail freight volumes is forecast to occur more quickly than in the past, and will be concentrated within Western Canada.
• Great Lakes ports, St. Lawrence ports, and Atlantic ports already appear capable of handling the forecasted rail volumes, but B.C. ports will require expansion to accommodate the projected increases.
• Canada’s Class I rail carriers, CN and CP, will need to continue to invest strongly in rail infrastructure over the next decade in order to accommodate the increased demand.

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Based on the results of our analysis, we conclude that growth in rail volumes through 2025 may occur more quickly than it has since 2001, both in terms of tonnage moved and rail carloadings. In aggregate, the tonnage of forecasted commodities shipped by rail is predicted to increase from 200 million tonnes in 2011 to 260 million tonnes in 2025. Correspondingly, rail car- loadings are expected to increase from 2.4 million in 2011 to 3.2 million by 2025.

The majority of this growth is forecast to occur within Western Canada. The largest increases in rail volumes, in absolute terms, originate in Saskatchewan and Alber- ta for transport into the United States. Also large is the growth in shipments from Saskatchewan and Alberta to British Columbia. Collectively, the increased shipments between these four origin-destination pairs are predicted to account for over 50 per cent of the total growth in rail carloadings between 2011 and 2025.

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Across all origins, rail volumes destined for B.C. are anticipated to increase by 17 per cent between 2011 and 2025. The major commodities that are expected to propel this growth include wheat, forestry products, and energy products. The vast majority of wheat and energy product shipments would originate in the Prairie prov- inces, while the majority of forestry product shipments would originate in British Columbia.