Mr. Keith Creel reports

CPKC PUBLISHES ANNUAL GRAIN SERVICE OUTLOOK REPORT

Canadian Pacific Kansas City Ltd. has published its 2023/2024 Grain Service Outlook Report, which outlines the company's plan to safely and reliably transport Canada's grain crop for export to international markets.

"As we look toward the upcoming 2023/2024 crop year, CPKC is once again well prepared to move Canada's grain crop to market, just as we have throughout our 142-year history," said Keith Creel, CPKC president and chief executive officer. "We have the capacity and the team to deliver for our grain customers and the Canadian economy during the upcoming crop year."

The report outlines CPKC's strong commitment to its grain customers and unique position to supply rail transportation to Canada's agricultural sector as the first transnational railway that provides a single-line connection between Canada, the United States and Mexico. This powerful new rail network provides Canada's grain shippers with access to markets across North America, including many new markets in Mexico, and enhanced routing options for shipping Canadian grain and grain products overseas. Additionally, CPKC has completed its more-than-$500-million investment to purchase 5,900 new higher-capacity grain hopper cars.

Notwithstanding CPKC's robust preparation and investments, there are several factors constraining Canada's export-driven grain supply chain, including:

• The recent strikes at port terminals across British Columbia, including at the Port of Vancouver, Canada's largest port, once again demonstrated the damaging and compounding impact of labour disruptions on supply chains. The prolonged duration of the strike means that supply chain recovery will stretch into 2024, potentially impacting grain transportation this fall.
• The federal government's commitment to introduce legislation prohibiting replacement workers by the end of 2023 would lead to even more frequent and longer labour disruptions at Canada's railways and ports.
• The persistent challenge of loading grain onto vessels during periods of rain or snow in Vancouver must be resolved to maximize supply chain capacity and reliability.
• The government's decision to resurrect extended interswitching on the prairies risks undermining rail efficiency and capacity. This policy incentivizes inefficiencies, causing higher transportation costs for all users of the rail network, and drives Canadian investment dollars and jobs to the U.S.
• Low demand for Canadian grain transportation at certain times during the 2022/2023 crop year, and in particular throughout the spring period, resulted in significant unused capacity on CPKC's rail network, undermining Canada's ability to maximize grain exports to global markets. Maximizing Canada's grain exports requires customers to use the available supply chain capacity throughout the entirety of the crop year.

Despite these avoidable headwinds, CPKC has the capacity and the team to deliver for grain customers during the 2023/2024 crop year.

About Canadian Pacific Kansas City Ltd.

With its global headquarters in Calgary, Alta., Canada, CPKC is the first and only single-line transnational railway linking Canada, the United States and Mexico, with unrivalled access to major ports from Vancouver to Atlantic Canada to the Gulf of Mexico to Lazaro Cardenas, Mexico. Stretching approximately 20,000 route-miles and employing 20,000 railroaders, CPKC provides North American customers unparalleled rail service and network reach to key markets across the continent. CPKC is growing with its customers, offering a suite of freight transportation services, logistics solutions and supply chain expertise.

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