Grain hopper car sale resurfaces

Railway Age, March, 2004 by Alex Binkley

A dormant proposal to dispose of the 13,000 grain hoppers owned by the Canadian government has been revived by a group called the Farmer Rail Car Coalition based in Saskatchewan. It hopes to have control of the cars by Aug. 1, the start of the new crop year.

Coalition President Sinclair Harrison has been trying for sever years to convince the government to turn over the cars to Prairie grain farmers for whom they were built. After meeting cabinet ministers and government officials in January, Harrison said there is a lot of political support for the coalition's proposal. However, the government has yet to agree to transfer ownership of the cars to the Coalition. It hopes to get them for a nominal sum.

The hoppers were mainly built in the 1970s and operated by Canadian National and Canadian Pacific. The former government announced in 1996 that it wanted to sell the cars to help reduce the deficit. However it shelved that plan because of disagreements among western farm groups and questions about the real value of the hoppers.

The railways say the cars should be auctioned off to the highest bidder. Estimates of the value of the cars have ranged from $C35 million as scrap to $C150 million as cars that could be operated as a lease fleet. The cars are all in service now but thousands of them were stored between 2002 and mid-2003 because drought shrunk the grain crop. Harrison said the coalition would set itself up as a leasing company. Grain shippers and companies could lease hoppers from the coalition, although it's likely the railways would be the main customers at first. The coalition would charge a fee for car use, which would go to paying for administration and maintenance and for their eventual replacement.