A link in the chain: Short line railways play a role in Canada’s supply chain

Great Sandhills Railway, based at Leader, Sask.

The pandemic has taught us many things over the past two years, and one of the major lessons is how fragile the world’s supply chains are. It did not take long for issues to emerge as COVID-19 set in. Canada learned early how quickly the pandemic could disrupt the beef industry (and toilet paper!).

COVID-19 has wreaked havoc on semiconductors, causing a global chip shortage that saw companies pause or reduce production on everything from vehicles to computers. Garage door parts became scarce. Both paper and lumber became hard to find. Not much of the supply chain has remained untouched by the pandemic. This has led to governments around the world and here at home examining how to prevent widespread supply chain issues from recurring whether pandemic-related or caused by something else entirely.

Addressing the issue

In January 2022, the Government of Canada hosted a National Supply Chain Summit to discuss the challenges facing the Canadian supply chain and to look for solutions. As well, a new national Supply Chain Task Force has been created to consult with industry to gather recommendations for action on supply chain issues. Finally, the Summit also announced a new $50 million call for proposals under the National Trade Corridors Fund (NTCF) to support fluidity across the entire Canadian supply chain, including easing congestion at the country’s ports.

A piece of the puzzle

As the country grapples with the ongoing supply chain issues and how to fix them, the Western Canadian Short Line Railway Association (WSCLRA) and its members may be part of the overall solution.

In the early days of the pandemic, short line railways such as the Great Sandhills Railway, stepped up as the country shut down. Great Sandhills Railway, based at Leader, Sask., helped immediately store the now-unneeded rail cars for Class 1 rail carriers. “We have the capacity to store thousands of cars in our network,” says Aaron Wenzel, general manager at Great Sandhills Railway and WSCLRA board secretary. “As the Class 1 railways needed our help, we did what we needed to support them.”

In more “normal” times, Great Sandhills moves grain, fertilizer, concrete, feed and a variety of products through its network, serving a local inland grain terminal and Pembina Pipelines, one of its major customers. Great Sandhills Railway is an important part of the local economy in rural Saskatchewan, connecting Burstall, Mendham, Leader, Prelate, Sceptre, Porteeve, Lancer, Abbey, Cabri, Battrum, Pennant, Success, Cantuar, and Swift Current, and interlines with the Canadian Pacific Railway at Swift Current.

Since the start of the pandemic, Great Sandhills Railway has seen demand for its network jump dramatically, and how it can support the national supply chain in ways not considered before COVID-19 arrived. “We more than fulfilled our commitments to the railway network during COVID,” says Wenzel. “We can also see now how vital short line railway is for the supply chain and the ways in which we can help going forward.”

 The future ahead

Great Sandhills Railway already has experience with NCTF, having had two projects funded to date. The company received $4.2 million in funding to upgrade its to increase the maximum speed of the line to 25 miles per hour (mph) from 10 mph, and $7.6 million to construct three loop tracks, and build a repair shop at the North West Terminal.

“The improvements to our infrastructure are great,” says Wenzel. “Now, we’re focused on building surge capacity close to the interchange so that we can better serve our customers and the national system. Short-line railways have an important role to play not only in Saskatchewan but across the country.”

The current National Trade Corridors Fund (NTCF) call seeks expressions of interest until March 31, 2022, with full project proposals due by the end of June 2022.