EMERGENCY LEGISLATION
Gov’t asking for extension
The Saskatchewan government is asking its federal counterparts to extend provisions of emergency legislation passed during the grain transport crisis of 2013-14.
Higher crop yields and a particularly cold winter that year gave the federal government cause to pass emergency provisions to the Canada Transportation Act. Known as the Fair Rail for Grain Farmers Act, the new law obligated railways to increase their minimum carrying capacity of grain and imposed penalties for failing to comply.
It also extended the interswitching distances in Saskatchewan, Alberta and Manitoba to 160 km from 30 km, for all commodities, to increase railroad competition and give shippers access to different rail services.
Interswitching allows farmers and shippers to pay a railway to move product to a junction with another railway company if it falls in the legislated radius.
The interswitching provision is set to “sunset” or, expire, on August 1.
In a March 3 letter, Saskatchewan’s Minister of Agriculture, Lyle Stewart, wrote his federal counterpart, Lawrence MacAulay, and Minister of Transport Marc Garneau.
“Our immediate concern is the expiry of key measures made under the Fair Rail for Grain Farmers Act,” Stewart said. “Extended interswitching in particular has been a success in Western Canada. Western grain companies and shippers have used interswitching to increase rail service and access to grain cars.”
That puts the province in line with agricultural groups across Western Canada. A number of those have asked for the emergency provisions to be extended.
Norm Hall, president of the Agricultural Producers Association of Saskatchewan (APAS), said the interswitching provision significantly increased the number of railroads available to farmers wanting to move grain, while also ensuring Canadian Pacific Rail (CPR) and Canadian National Railway (CNR) stay competitive with one another.
“You’ve got McDonalds in your town, and only McDonald’s. Where do you eat? McDonalds,” he said. “If you’ve got McDonald’s and Subway, then you have a choice — and that means McDonald’s has to keep its prices in lines, its service in line. It’s the same here.”
CP and CN came out against the provisions when they were put in place. CPR challenged the decision to increase the radius from 30 km to 160 km in court.
“If there is a threat that grain company ‘A’ will call on the other railroad to take their cars to the coast, then railroad company ‘A’ has to provide at least equal service to what the other railroad is offering,” Hall said.
Levi Wood, president of the Western Canadian Wheat Growers, said there is a fair bit of uncertainty within the industry on what will be available when it comes to transporting grain at a time when a lot of grain is needed to be transported.
“The challenge in not knowing, is there’s not a huge amount of time between (August 1) and the commencement of harvest,” he said.
Stewart wrote in his letter the province is currently reviewing a federal report on the broader future of transport legislation, but that “it is essential that both houses of parliament pass the necessary motions to extend the temporary provisions in the act until consultations have been completed and a plan for the Canadian transport system has been developed.”
In a statement, Transport Canada said “a decision has not been made on provisions” and that they would sunset unless postponed by a resolution passed by both houses of Parliament.