Tuesday, January 29, 2008
http://www.statcan.ca/Daily/English/080129/d080129b.htm
Rail transportation
2006 (preliminary)
The Canadian railway industry continued its strong performance in 2006, with operating revenues increasing for the eighth consecutive year. For the year, operating revenues rose 5.9% from 2005 to $10.4 billion.
The commodities transported within, into and out of Canada in 2006 totalled 282.8 million metric tonnes, a 0.8% increase from 2005. Coal continued to be the main commodity.
Among the factors contributing to the gain in operating revenues were a favourable economic climate, increases in freight rates and higher fuel surcharges stemming from higher prices for crude oil. The increase was also a result of past and current industry initiatives focusing on the performance and profitability of the Canadian railway industry.
These initiatives include stronger customer-focused marketing strategies, improvements in service and consistency of delivery, increased training of employees, and the acquisition of more powerful, fuel efficient locomotives that allow railways to carry more freight using less resources. As well, railways have and continue to focus on extending their market reach through investments in and alliances with other carriers.
Steady growth in revenues since turn of the millennium
The success of the industry's initiatives can be seen during the period from 1999 to 2006 in which revenues grew by 34.8%, an annual average gain of 4.0%.
This increase was significantly higher than the average annual decline of 2.1% the industry experienced during the 1990 to 1992 recession. It was also more than twice than 1.8% average growth rate between 1993 and 1998 following the recession.
Freight transportation revenues, which comprised 89.9% of the total of operating revenues for the industry, grew 6.8% to $9.4 billion in 2006. In addition, passenger transportation revenues rose 4.1% to $294.5 million.
Operating expenses increased for the industry as well in 2006 but at a lesser rate than revenues. For 2006, operating expenses increased 3.8% to $7.8 billion, compared with $7.5 billion in 2005. The increase in operating expenses was mainly the result of higher costs associated with rail operations and general expenses.
From 1999 to 2006, operating expenses increased 15.8%, less than half the growth rate of the industry's operating revenues.
Rise in net operating profit
As a result of the industry's strong performance in 2006, net operating profit climbed 13.0% to $2.6 billion from $2.3 billion in 2005. At the same time, net income, after tax and extraordinary items, increased 11.8% to $1.9 billion from $1.7 billion in 2005.
The rail industry also saw its total assets grow in 2006 to $19.5 billion, a 4.6% increase over $18.7 billion in 2005. The balance of the property accounts, which include land, equipment and ways and structures, rose 3.2% to $25.9 billion in 2006. Over the last eight years, the rail industry's assets have increased 31.9%.
Employment in the rail industry continued its decline in 2006 to 34,137, down 2.5% from the 34,995 in 2005. Employment in 2006 represented 78.7% of the level of 43,356 in 1999 and only 15.9% of the 215,000 recorded in 1956.
In contrast, the average annual salary of employees continued advancing in 2006. For the year, the average annual salary stood at $71,260, up 0.8% from $70,689 in 2005 and 23.4% above $57,731 in 1999.
The total number of rail passengers edged down 0.6% from 2005 to 4.2 million. The total number of passenger-kilometres declined 1.9% to 1.5 billion. As a result, the average passenger trip dropped 1.2% in 2006 to 342 kilometres from 346 kilometres in 2005.
Total commodity tonnage edges up
On an origin and destination basis, the total tonnage of commodities transported within, into and out of Canada edged up 0.8% to 282.8 million metric tonnes.
Coal continued to be the main commodity transported in 2006. Mixed loads or unidentified freight was in second place, and wheat in third. These three commodities accounted for 28% of the total tonnage in 2006.
Compared to 2005 levels, coal declined 6.3% to 32 million metric tonnes in 2006. Mixed loads or unidentified freight increased 9.0% to 25.4 million metric tonnes, while wheat increased 16.8% to 21.8 million metric tonnes.
The surge in wheat in 2006 was the result of a good harvest year and increased orders.
From a regional traffic perspective, railways shipped 30.7 million metric tonnes from the Atlantic region to all destinations in 2006, down 2.6% from the previous year.
In terms of commodities transported between the Atlantic region and Quebec in 2006, iron ore and concentrates continued to be the main commodity transported with 20.4 million metric tonnes, a 0.4% decline from 2005.
Traffic from Quebec to the United States and Mexico accounted for 46% of all traffic originating from Quebec in 2006. The main commodity transported between the province and the two countries was paper and paper board (except printed products) at 1.7 million metric tonnes, up 4.8% from the previous year.
The United States and Mexico accounted for 46% of all of Ontario's markets in 2006. The main commodity transported from Ontario to the two countries was metallic waste and scrap, the tonnage of which rose 42.0% from 2005 to 1.6 million metric tonnes.
In the reverse direction, coal remained the main commodity transported to Ontario from the United States and Mexico in 2006. Coal increased 9.9% over 2005 to 2 million metric tonnes.
British Columbia and its ports continued to be the main destination for all commodities originating in Saskatchewan in 2006, accounting for 36.0% of Saskatchewan's traffic. The main commodity transported in 2006 was potash, which declined 21.2% to 4.7 million metric tonnes.
Within British Columbia itself, coal remained the main commodity transported in 2006, accounting for 64% of the total tonnage shipped within the province. Overall, coal declined 15.5% from 2005 to 20.1 million metric tonnes.
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The publication Rail in Canada, 2006 (
http://www.statcan.ca/bsolc/english/...tno=52-216-XWE ) is now available from the Publications module of our website.
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