News

27
Feb 2015

Complaints about poor performance persist despite gov’t intervention

By: Bruce Johnstone
Regina Leader-Post

REGINA — Nearly one year after the federal government announced tough new rules to get grain moving, complaints about poor performance by the railways and excessive grain handling charges by the grain companies seem as prevalent as ever.

For their part, Canada’s railways say they moved the better part of 42 million tonnes of grains last year — part of the largest crop in Canadian history at 77 million tonnes.

CN recently announced it shipped 18 per cent more grain hopper cars in the first half of the 2014-15 crop year than it moved during the same period last year. Since March 2014, CN claims it has exceeded its mandated grain volumes by two million tonnes.

However, the Ag Transportation Coalition, which represents producer groups, elevator companies and food processors, says that the railways are moving more grain, but not meeting shippers’ demands.

In its latest report Wednesday, the coalition noted the railways are failing to deliver hopper cars on time more often than not.

“In the crop year to date, the railways have supplied 44 per cent of customer orders in the week for which cars were ordered,’’ the report said.

“Through the first 26 weeks of the current crop year, railways have failed to supply 19,546 hopper cars ordered by shippers. This represents a shortfall equivalent to 10 per cent of shipper demand.”

“The number of hopper car orders not filled by both CN and CP has continued to increase each week since the beginning of the crop year,...indicating that the railways are not making up ground for prior week shortfalls.”

But CN has challenged the coalition’s numbers, saying they are based on “phantom orders’’ carried on a “shadow order book” visible only to the coalition. “CN does not accept the Ag Transport Coalition’s analysis and claims regarding outstanding orders and railway dwell times, which are neither comprehensive nor transparent.”

However, the Saskatchewan Wheat Development Commission blames both the railways and the grain companies for failing to deliver the goods. “Rail transportation and handling capacity has not improved and this is being reflected in even lower returns for producers and a lower share of export values as the year progresses,’’ said Bill Gehl, chair of the commission.

Gehl estimated grain prices at the elevator have dropped roughly $20 per tonne since October due to higher handling charges by grain companies.

Similarly, the Canadian Wheat Board Alliance, a pro-orderly marketing farm group, claims “excess basis” charges are costing farmers nearly $2 per bushel, which, after shipping and handling charges are deducted, leave farmers with just over $5 in their pocket from a $10 bushel of wheat, .

“It is real money that the grain companies have which should have gone to farmers,” said Kyle Korneychuk, spokesman for the CWBA.

In question period Wednesday, Deputy Liberal Party Leader Ralph Goodale asked Transport Minister Lisa Raitt, based on the latest Ag Transport Coalition report, whether she felt the railways were providing “suitable and adequate accommodation for grain shippers?”

Raitt replied that the Fair Rail for Grain Farmers Act is “working for grain farmers here in Canada, that indeed the grain is moving to the port and indeed it is happening in the framework that we expected it would.”

Read more at the LeaderPost.Com

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