The Canadian Pacific line serving Peterborough Industrial Park - Date unknown Brendan Wedley.

26 September 2012

Rail Important to United Canadian Malt Firm Hopeful Another Operator Will Take Over Rail Line

Peterborough Ontario - United Canadian Malt relies on rail service for the delivery of raw grain to the plant on Lansdowne Street West, but the company was told in late August that Canadian Pacific Railway will abandon the line.
 
It's a three-year process for CP Rail to divest itself of the tracks and the company remains hopeful that another organization will step in to operate the line, United Canadian Malt general manager Monte Smith said Tuesday.
 
"That line is extremely important to deliver rail cars of grain," he explained. "This issue of the rail abandonment, or them trying to get rid of the lines, is a concern for this business.
 
"It's not a nice idea, or a comfortable idea, for us to deal with."
 
City council received a report Monday revealing CP Rail's plan to close the line to United Canadian Malt and the line that goes to Peterborough Industrial Park in the southeast corner of the city. CP Rail doesn't have any customers in the industrial park and the track's condition has been left to deteriorate.
 
Mayor Daryl Bennett has expressed hope that Shining Waters Railway, the organization that wants to resurrect commuter rail service between Peterborough and Toronto, will step in to operate the lines in Peterborough to maintain freight service.
 
Smith shared that his company hasn't started planning for operating without rail service to the plant.
 
"I'm not looking at that possibility right now," he said, pointing to the possibility of another company taking over the rail line. "We have three years to make our plans and to check into what we need to do."
 
"We're going to kind of roll with that as it goes along."
 
The company gets about 20 to 40 shipments by rail each year, Smith said.
 
The loss of rail service would increase the cost of putting the raw material into production, Smith explained.
 
"That's a significant financial impact to the company," he said.
 
The plant, which started as Ovaltine Foods in 1929 and changed to United Canadian Malt in 1987, employs about 20 people, Smith said.
 
About two years ago, the city tried to keep rail service to the south-end Peterborough Industrial Park by taking over and repairing the rail spur within the industrial area at a cost of about $375,000.
 
Planning and development services director Malcolm Hunt referred questions about the companies that were using the rail service at the time to CP Rail.
 
Hunt said the last significant rail service customer in the industrial park was Imperial Pipe, which left the industrial park about two years ago.
 
Last summer, the swing bridge over the Otonabee River just north of Lansdowne Street was operational, Hunt said.
 
Now the bridge is left in the open position and CP Rail estimates it would cost about $400,000 to repair the structure, Hunt told council.
 
Hunt downplayed the significance of losing rail service to the industrial park.
 
From time to time, various industrial companies interested in moving to the area have expressed interest in the option of using rail service, "but rarely has it been a key determinant in their choice of location," he said.
 
Brendan Wedley.