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CTY LTD Update
The purpose of this Information Bulletin is to bring everyone up to date
on what has happened since the CTY LTD Ratification.
Railroad workers have been fighting fatigue in the
rail industry for decades but the problem persists. We are now asking
you to help us document the problem.
CP vows steady flow of
Source: By Lauren Krugel - The Sudbury Star
Published: May 11th 2008
Canadian Pacific Railway is taking steps to make sure grain and other
high-demand commodities flow more smoothly across the continent, the
company's chief executive said Friday.
Fred Green said the railway "took away some learnings" from the past few
quarters, which were beset by weather delays and other operational
"We learned that our grain processors across Canada were built for the
era prior to the recent grain company merger activity, and we were not
adaptable enough when the forces of the severe winter impacted the
supply chain," Green told the company's annual meeting in Winnipeg.
"To address this, several organizational changes were implemented in
April to better align to our new grain world."
The railway has appointed a new vice-president of grain, and new
managers to oversee grain shipment and bulk pulp lines in the Port of
"With these leaders now in place, we will make process changes to ensure
that CP is not the bottleneck in the grain supply chain."
Green said the railway is poised to take advantage of a strong
agriculture industry, with prices of wheat, corn, soybeans and rice
surging because of soaring demand.
"With record crop prices and strong global demand, our role is to enable
the industry's success by having the right capacity in the right place
at the right time - something that will serve both CP and our clients
very well for years to come."
Over the trying winter, marked by bitter cold throughout the Prairies
and record snowfall in Eastern Canada, the railway also learned that
demand for bulk services is "robust - perhaps even stronger than we
thought, not only for today, but very likely well into the future,"
"As such, we are selectively expanding our track capacity to meet
demand, but of equal importance to drive efficiency - a cornerstone of
our game plan every year."
Tom Varesh, an analyst with Canaccord Adams, said it would be a good
idea for Canadian Pacific to lay down a second set of tracks alongside
its existing lines in some high-traffic parts of the country.
"That would allow them to bypass a slower-moving train or a train that
perhaps would be holding up this grain shipment," he said in an
At the shareholder meeting Green said the railway is "actively
advocating" expanding capacity at the Port of Vancouver so that
high-demand commodities like grain, coal and potash can be more
efficiently shipped to booming Asian markets like China and India.
"We believe it's critical that all supply chain partners are engaged in
the process. We are only as strong as the weakest link in the supply
chain," Green said.
Last fall Canadian Pacific announced the $1.48-billion acquisition of
Dakota, Minnesota & Eastern Railroad Corp., which would give the railway
access to the U.S. Midwest.
Green said he expects to see a "very smooth transition" when CP takes
control of DM&E on Oct. 30.
However, there has been some resistance to a planned expansion of that
railway into Wyoming's coal-rich Powder River Basin.
The so-called "Rochester Coalition" wants the extended railway to bypass
the Rochester, Minn., area, where opponents say a train accident could
endanger patients at the renown Mayo Clinic.
Despite the challenges ahead, Varesh said his outlook for Canadian
Pacific is "very positive," giving it a "buy" rating with an $80 share
Shares in Canadian Pacific were down $1.14 to $73.34 Friday afternoon on
the Toronto Stock Exchange, with a 52-week high and low of $91.00 and
Rising prices for coal in particular are expected to be a boon, Varesh
said. Fording Canadian Coal Trust (TSX:FDG.UN) has just settled
contracts for most of its coal sales at US$275 per tonne, compared with
US$93 last year.
Canadian Pacific's five-year contract to ship coal from Fording's mines
to Vancouver for export is set to expire in March 2009, so the higher
prices will not have an effect on the railway's business for a few