In a determination issued today, the Canadian Transportation Agency (CTA) ruled that revenues of both the Canadian National Railway Company (CN) and the Canadian Pacific Kansas City Railway Company (CPKC) were above their respective maximum grain revenue entitlements for the crop year 2022-2023.
- CN's grain revenue of $1,079,522,039 was $3,457,939 above its entitlement of $1,076,064,100.
- CPKC's grain revenue of $943,886,400 was $3,369,407 above its entitlement of $940,516,993.
CN and CPKC now have 30 days to pay the amount they exceeded their 2022-2023 revenue entitlements, in addition to a five percent penalty of $3,630,836 for CN and $3,537,877 for CPKC. Regulations require these payments to go to the Western Grains Research Foundation.
An increase in the volume of grain moved this crop year
In the 2022-2023 crop year, 45,303,841 tonnes of Western grain were moved. This represents a 60 percent increase in volumes compared to the last crop year, which saw 28.4 million tonnes transported. The increase in the volume of grain was due mainly to improved growing conditions following the drought experienced in Western Canada during the 2021-2022 growing season.
Determining the Maximum Revenue Entitlement
The Canada Transportation Act requires the CTA to determine each railway company's annual maximum revenue entitlement (MRE) and whether each entitlement has been exceeded. The revenue entitlement is a form of economic regulation that enables CN and CPKC to set their rates for services, provided the total amount of revenue collected from their shipments of Western grain remains below the ceiling set by the CTA.
Additional Resources
About the Canadian Transportation Agency
The Canadian Transportation Agency (CTA) is an independent regulator and quasi-judicial tribunal with the powers of a superior court. The CTA's mandates are:
- To help ensure that the national transportation system runs efficiently and smoothly in the interests of all Canadians: those who work and invest in it; the producers, shippers, travellers, and businesses who rely on it; and the communities where it operates.
- To provide consumer protection for air passengers.
- To protect the human right of persons with disabilities to an accessible transportation network.
