Blockade impact long term

Farmers and business leaders say it could take weeks or months for the agriculture industry to recover from a crippled rail network.

They said the impacts of numerous transportation issues, including blockades by protesters along a Canadian National Railway line, have been enormous to the national economy and the country’s reputation as a reliable exporter.

The blockades followed a late harvest, a CN strike, and recent bad weather along the rail line and at the Port of Vancouver. It has culminated in what people in the agriculture industry describe as a dire situation.

“The negative effects resulting from these disruptions to our railway network will take months to fully overcome and will have a direct effect on the competitiveness and profitability of Canadian farmers,” said Rick White, president and chief executive officer of the Canadian Canola Growers Association.

The blockades had been established by protesters in support of Wet’suwet’en hereditary chiefs, who oppose an LNG pipeline in northern British Columbia. The pipeline, however, has support from the 20 First Nations band councils that have signed agreements in favour of the project.

As of Feb. 24, Ontario Provincial Police moved in to dismantle the barricades near Belleville. Days before, Prime Minister Justin Trudeau urged protesters to take it down, putting onus on indigenous leaders to step in.

But as the blockades persisted, they built up to a point where some grain elevators had to delay farmer deliveries because of backlogs, according to Wade Sobkowich, executive director of the Western Grain Elevator Association.

Sobkowich said on Feb. 20 the delays are costing the grain sector $9 million a day. He attributed those costs to penalties for extending contracts and for lost productivity.

“It’s embarrassing, for one thing, and it is damaging our reputation,” Sobkowich said. “We end up looking real bad, and the next time customers buy our products, they could put a risk premium for our grain because they have no confidence we will deliver it in a timely way.”

Viterra said in an emailed statement Feb. 21 that the barricades have compounded problems.

It said each day that movement is lost, capacity in the transportation system can’t be recaptured.

“Even if these blockades were to cease immediately, it will take weeks and perhaps months for our industry to recover,” the company said, noting the ideal window for farmers to market grain is closing.

Mark Hemmes, president of Quorum Corp., which oversees the federal grain monitoring program, said it’s going to take months before the system returns to normal, possibly pushing farmer cashflow into the summer.

John Heimbecker, CEO of Parrish & Heimbecker, said on Feb. 20 the railways can’t make up for the lost time and that the bottlenecks might have cost Canada hundreds of millions of dollars.

“The losses that have occurred can’t be earned back,” he said.

Despite concerns, CN believes it’s possible for grain movement to recover.

Sean Finn, executive vice-president of CN, said on Feb. 21 it’s going to take two to three weeks for the company to get back up to speed for its western Canadian operations, as long as the weather co-operates.

He said once trains can move again in Ontario, the company could catch up in three to four weeks.

He said Western Canada has lost 35 percent of its capacity.

Reports retrieved Feb. 24 from the Grain Monitor and the Ag Transport Coalition showed more than 50 grain vessels waiting to be loaded off the West Coast. The average for this time of year is 25, according to the Canadian Canola Growers Association.

It showed that 20,000 rail car orders remain unfulfilled.

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