BobbyT wrote: ↑Sat Jan 29, 2022 2:37 pm
CN, in addition to the building and refined petroleum products, there's also significant pulp and paper that CP hauls out of SJ and ME that goes into CSX territory, that will be lost. In terms of their Maine LPG business based around the Bangor area, there is already a large new LPG terminal going in at Waterville (Fabian Oil) that is surely going to cut into that traffic (Fabian now gets much of their LPG from Bangor) and in my opinion it is only a matter of time before another terminal gets built in the Bangor area on CSX. At the end of the day, CP's real achilles heel is that CSX sourced LPG is more competitive than what CP can move into the area and eventually CSX will surely take full advantage of those economics. Nobody is saying that CP is going to go bankrupt because of CSX gaining access to Maine and the Maritimes, but it is certainly going to take a big chunk out of their current manifest traffic base.
For a few years I shipped paper for a living… a lot of it flows to the Midwest because there used to be a lot of mills there (just like here) and it’s centrally located for distribution for rapid deployment...for example you should look up Quad Sussex (Waukesha, Pewaukee too but they aren’t rail service presently) or LSC communications. The northern paper is known for durability (tear strength) and quality due to our species mix in wood basket that stretches from Maine, across Canada and up into Wisconsin and Minnesota. Also remember, there has historically been traffic for a long time on this line going out the western gateway…. CDAC, MMA and CMQ relied on that backbone traffic.
Right now CP has secured a lot of inbound pulp moves out of Toronto and western Canada (you’ll see them moving in their own cars), which is either supplement to Irving’s production plants (SJ or Lake Utopia) or for export via breakbulk or stuffed in containers (I’ve done both via SJ). Also Pixelle in Maine grabs some spot market pulp that can come in via the Moosehead or Saratoga (I’ve seen both routings) to ST. Remember the origin/destination points are important… also people tend to forget that 7 of the top 10 customers on the CMQ lines are in Canada…. Once 251 works Sherbrooke and Farnham it can easily add 40, 50 or 60 cars. Add that onto the traffic out of Maine and NB… they are well over 100 cars most trips, which isn’t as bad on the line west of Sherbrooke.
The LPG demand in Maine is growing… the home fuel mix is changing and there is a lot of new construction. LPG hot water heaters, boilers, stoves and fireplaces are all popular as they are more efficient than old oil burners, and a good alternative if you don’t have natural gas off the street.