CN’s October rail-fuel schedule shows how lagged diesel indexes reach project costs
The eligible monthly intermodal tariff uses an August diesel reference, separating fuel-adjustment timing from the equipment’s delivery date.
- Publish date: 2026-10-09
- Category: HVDC & Substations
- Original source: CN
- Reading time: 2 min
What the primary source establishes
CN’s published CN 7405 schedule lists an October 2026 intra-Canada surcharge of 34.20%, against 30.29% for September; its separate US column is 43.70% for October. The October basis is August’s US on-highway diesel average of USD 5.462 per gallon. This is an effective tariff schedule, not an October retail-diesel observation. The undated page was checked on 9 October. The page provides no publication timestamp.
How the costs connect
Our economic interpretation: a lagged fuel clause can move while the latest pump price is moving differently. CN 7405 applies to eligible intermodal linehaul freight charges, rather than the value of a transformer or the full installed project. CN’s mileage-based carload and weekly intermodal schedules have different formulas. Their rates must not be combined simply because they are all called fuel surcharges. The separate US percentage is not an exchange rate.
An explicitly illustrative calculation
In an explicitly illustrative eligible intra-Canada shipment, hold the linehaul base at CAD 10,000. October’s 34.20% adds CAD 3,420, yielding CAD 13,420 before other charges. September’s 30.29% would add CAD 3,029 on that same assumed base. The difference is CAD 391, corresponding to 3.91 percentage points of the base, not a 3.91% increase in the equipment price. This is arithmetic, not a binding carrier quotation.
What buyers should record
For Canadian energy-equipment delivery, identify the actual tariff number, origin, destination, eligibility and surcharge base in the offer. Keep terminal handling, specialist lifting and onward road transport separate. The October monthly schedule should not be replaced with a weekly rate or with the US column. Confirm whether the supplier has already included fuel so the buyer does not add the same adjustment twice.
The monthly lag matters when reconciling a rail quote with a fuel-market headline: the reference month and the transport month can differ. Ask the forwarder to identify the rail linehaul base, the applicable tariff and whether drayage, terminal handling and storage are separately billed. Truck legs may use another fuel formula altogether. A project’s landed-cost comparison should therefore align service boundaries and billing months before adding the rail surcharge to other logistics charges or applying currency conversion.
US–Canada freight, fuel and currency effects on project costs