Letter to E. Hunter Harrison, President and Chief Executive Officer of Canadian Pacific Railroad - Agriculture Shipment Delays

Letter

July 22, 2014

E. Hunter Harrison
President and Chief Executive Officer
Canadian Pacific Railroad
7550 Ogden Dale Road S.E.
Calgary, Alberta

Dear Mr. Harrison,

With the current year's harvest fast approaching, I write to request your immediate attention to concerns expressed by farmers and grain elevators in North Dakota on the performance of Canadian Pacific. Specifically, I request further information on the extent of the delays in North Dakota and the steps Canadian Pacific is taking to restore reliable and affordable service for rail customers in my state this year and in the coming years.

In the coming weeks, harvest will begin in North Dakota. I am greatly concerned about the ability of the grain storage and delivery system to withstand further difficulty in accessing needed rail service to move grain to market. If farmers and grain elevators are unable to move current inventories of agricultural commodities being stored at the elevators or in bins on the farm, there is a great possibility that insufficient storage space will be available to accommodate the coming harvest. The time to act is urgent. Winter wheat harvest will begin on many farms as early as next week and will be followed shortly by the even higher volumes of harvested spring wheat, barley and durum. By the end of September, harvest for corn and soybeans may be well underway as well.

North Dakota rail customers, particularly farmers and grain elevators, are in the midst of a prolonged period of difficulty in moving their products to market. Increased congestion on the rails from record high demand, paired with higher than average need for track repairs due to the lingering effects of a record cold winter, have combined to significantly delay the shipment of products to market.

In June 2014, the Surface Transportation Board (STB) recognized these problems in the region and mandated that Canadian Pacific report on its plans for service improvement. While I appreciate your timely submission of performance statistics to the STB, I respectfully request additional information related to the extent of the problems in North Dakota. For instance, it was recently reported that over 10,000 agricultural cars are past due nationwide for the customers of Canadian Pacific. What portion of these past due cars are found in North Dakota? Also, how long have the cars been late in North Dakota on average? Knowing how many cars are late in addition to how late they are will give my constituents valuable information about the extent of the troubles in North Dakota. Additionally, providing information about improvements to service metrics that have taken place, or are expected to take place, will provide Canadian Pacific the opportunity to restore weakened confidence among its customers in my state.

In addition to information related to the current situation on the ground, I write to request an update from your company on both the short and long term plans to improve the effectiveness and reliability of service to customers. In the short term, what volume of service in terms of unit trains per week does the railroad anticipate dedicating to the shipment of grains in North Dakota in the current year's harvest season? In the long term, what capital enhancements are planned in the coming months and years to expand the railroad's capacity to meet customer demand? Will the railroad make investments to add to track lines in service to carry grain? Will the railroad invest in track sidings to better facilitate two-way traffic where congestion has made progress difficult?

Thank you for your prompt attention to this important request, and I look forward to working with you on efforts to improve rail service to the agricultural producers of North Dakota.

Sincerely,

Heidi Heitkamp
United States Senate

Cc: Robert A Johnson, Senior Vice President, Operations Southern Region, Canadian Pacific Railroad

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