Business

Stressed supply chains snarled anew as B.C. floods wash out rail lines, roads

The complex problem of moving goods from Point A to Point B has been made even more complicated by record-breaking rainfall and flooding in B.C. that have washed out rail lines and highways in the Lower Mainland.

Problems are the result of record-setting floods in B.C.

CN says its rail network has experienced a number of mudslides and washouts near Yale, B.C. (Graham Hughes/The Canadian Press)

The complex problem of moving goods from Point A to Point B has been made even more complicated by record-breaking rainfall and flooding in B.C. that have washed out rail lines and highways in the Lower Mainland.

Experts say the floods have taken an already tight supply chain and made it even tighter, at the worst possible time.

"It's not going to be good," said Barry Prentice, a professor of supply chain management at the University of Manitoba in Winnipeg.

Most highways in and out of Vancouver have effectively been shut down, bringing truck traffic to a crawl. While trucks are used for shorter haul distances of comparatively smaller loads, trains handle the bulk of transport.

All rail traffic in and out of the Port of Vancouver has been halted, the port confirmed to CBC News in a statement Tuesday. "A timeframe for re-opening of the rail lines will be known once damage assessments are complete," spokesperson Matti Polychronis said.

WATCH | Major highway in B.C. washed away 

Coquihalla Highway severely damaged by cascading river

6 months ago
Duration 5:04
The surging Coquihalla River caused a section of Highway 5 to wash away near the Caroline Mine area close to Hope, B.C.

Rail traffic into Vancouver is halted because of problems down the line, both of Canada's major rail lines told CBC News Tuesday.

CN Rail said its network has experienced a number of mudslides and washouts near Yale, B.C., and one of its trains partially derailed in an area of the province that has seen almost 300 millimetres of rain in recent days.

"There were no injuries, fire or spill, or dangerous goods involved," CN said of the train that partially derailed.

Both companies have a rail line in the area, but Prentice says under normal circumstances, all traffic moving south would be on one line while the other company's line would handle all northbound traffic.

CN says its derailed train was on the CP-owned line and said it has not yet been able to assess the damage or begin repairs. CP confirmed to CBC News in an email that it has had a "track outage" near Hope, B.C.

"CN's crews are ready to safely tend to the affected sites but await a stabilization of conditions to begin the work," CN said. "CN will continue to monitor the affected sites and will begin construction efforts once it is deemed safe to do so."

Bad timing

And there may be more. The province's transportation ministry shared images on Twitter of other sections of rail line near Lytton, B.C., that appear to have been damaged.

Prentice says the rail outages come at a time when demand is high, because farmers in Western Canada are in the midst of shipping their crops to the coast for export.

"Any time you have a landslide or a break in the mainline, it backs up traffic, and you want to get that fixed as quickly as you can," Prentice said.

A single train can sometimes carry as much as what 400 trucks could haul, he said.

"In this particular case, the situation is more extreme because they can't even get started to work until the weather clears somewhat."

It's a concerning situation not just for those looking to export but also those looking to bring in supplies.

Henry Braun, the mayor of Abbotsford, B.C., told CBC News that dairy farmers in the area are anxious.

"They're going to be devastated because we're going to run out of feed in four or five days," he said. "They only have so much in storage."

Ports already congested

The outage will only exacerbate the situation at the Port of Vancouver, which was already congested because of previous supply chain issues related to the pandemic.

The rail lines in question are the main arteries in and out of the port. "The mere fact that those trains are stalled means that it's going to back up further because those ships are still underway," Prentice said.

Adel Guitouni, a business professor at the University of Victoria, says the pandemic followed by recent natural disasters have underscored just how fragile global supply chains are.

"It would have a huge impact, and it would be felt not just in B.C. but across the country," he said in an interview. "You start having shortages in places and a lot of accumulation in other places."

Depending on the extent of the damage, he thinks the rail companies will likely have most of their lines back up and running within a week or so, but clearing the global backlog in supply chains will take much longer.

"This will take until probably 2023 to see some kind of getting back to normal," he said

Impact on 'life blood of the railroad'

On a conference call with investment analysts on Tuesday morning, CP's executive vice-president John Brooks called the Lower Mainland area of B.C. that has been hit by floods this week "the life blood of the railroad."

"I know the team was active this morning working with our customers to find alternative markets or directions to send [rail cars]," he said

The company was working to divert some affected traffic toward Portland, Ore., he said.

"It's too early to tell what the ultimate impacts are, [but] they will get that main line open as soon as we physically can and we'll be ready ... as an operating team to get that freight back moving certainly as quickly as we can."

It's the second time this year that the province's rail system has been waylaid by natural disasters, as the wildfires around Lytton this summer caused both companies to partially shut their networks temporarily.

ABOUT THE AUTHOR

Pete Evans

Senior Writer, CBCNews.ca

Pete Evans is the senior business writer for CBCNews.ca. Prior to coming to the CBC, his work has appeared in the Globe & Mail, the Financial Post, the Toronto Star, Canadian Business Magazine and — believe it or not — Circuits Assembly Magazine. Twitter: @p_evans Email: pete.evans@cbc.ca Secure PGP: https://secure.cbc.ca/public-key/Pete-Evans-pub.asc

With files from the CBC's Meegan Read

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