Producers seeing shipping delays: ag group
Industry hopes new federal plan helps avoid grain backlog
Todd Lewis says he is optimistic that a slate of new measures from the federal government and the major railways will help prevent another costly grain backlog, but delays in northeastern Saskatchewan suggest they need time to take effect.
Lewis, president of the Agricultural Producers Association of Saskatchewan, joined about two-dozen supply chain stakeholders for what federal Transport Minister Marc Garneau described as an “unprecedented” closed-door roundtable in Saskatoon on Wednesday.
Held as part of the Liberal Party of Canada’s annual caucus retreat, the meeting was intended to facilitate what Garneau and Agriculture and Agri-food Minister Lawrence Macaulay characterized as an industry-wide desire to work together and avoid holdups.
After the meeting, Lewis said he hopes better communication between the railways, grain shippers and farmers will help identify and resolve problems quicker, but noted some farmers in the province are already experiencing delays.
“In eastern Saskatchewan there’s already concerns about a lack of service, October deliveries that aren’t going to be happening until later in the year. Some producers are already being told that,” Lewis told the Saskatoon Starphoenix.
“Certainly in the Tisdale area there’s a shortage of rail cars … They had three weeks of virtually no service so there’s hundreds of cars that they’re behind already. That’s a big oat-producing area, and those oat producers are putting their oats in grain bags as we speak.”
Slow-moving grain has long been a concern for Saskatchewan farmers. A massive backlog in 2013-14 is estimated to have cost Western Canada $6.5 billion; the total cost of last winter’s holdup is not known, but thought to be significant.
Speaking to reporters after the meeting on Wednesday, Garneau and Macaulay acknowledged that problems may crop up but emphasized the steps taken by Ottawa as well as Canadian National Railway Co. and Canadian Pacific Railway Ltd. to improve service.
Those measures include Bill C-49, which has provisions aimed at streamlining service and making the railways more accountable, and multi-year, multimilliondollar investments in new locomotives, hopper cars and railway infrastructure by both CN and CP.
“It’s hard to solve everything instantaneously, but there’s major investments taking place,” Macaulay said.
Those investments, Garneau added, give the industry “resiliency, particularly when we face things that we can’t totally predict ahead of time” — a reference to cold winter weather, thought to be a major contributor to both recent backlogs.
“That’s one thing that was indicated quite clearly here today, it’s that the co-operation, open dialogue also with the investment is so vitally important. Are things answered immediately? No. But they will be,” Macaulay said.
Garneau added that his government believes pipelines are the best way to move oil, and said projects — like the governmentowned and stalled Trans Mountain pipeline expansion — would “have an impact on how much is transported by train.”
J.J. Ruest — who took over as CN’S chief executive after the railway, under pressure from Ottawa amid fears of a backlog, ousted its former CEO and issued an unprecedented apology — said hearing from producers and shippers was productive.