Officials with Canadian Pacific Railway have raised a red flag over a recent report on rail performance commissioned by a coalition of agricultural shippers in Western Canada.
On Jan. 27, the Ag Transport Coalition — comprised of producer groups and grain shippers — released a report suggesting that the country’s major railway companies are providing inadequate service to the agriculture industry.
The report was funded in part by a federal grant furnished through Agriculture Canada’s Growing Forward 2 program.
Shippers involved in the Ag Transport Coalition (ATC) have lobbied Ottawa for tougher legislation to ensure better rail service.
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On Jan. 30, CP officials issued a strongly worded statement saying Canadian Pacific “is appalled that a government-funded group … can claim it is trying to enhance the competitiveness of the agricultural supply chain.”
It is unclear how much Ottawa contributed to the ATC project.
The report was prepared by QGI Consulting, a privately-owned consulting company whose affiliates include Quorum Corporation, the federally appointed monitor of Canada’s grain handling and transportation system.
“The use of public funds to drive a single, self-serving agenda under the guise of solving large, complex supply chain issues is unconscionable.,” said CP’s chief executive officer Hunter Harrison.
“It is our belief that any discussions about commodity movement should include all pieces of the supply chain puzzle,” he added.
“It is disingenuous for the Ag Transport Coalition to say it wants to improve the agricultural supply chain if they don’t want to involve transportation stakeholders in the discussion.”
ATC spokesperson Wade Sobkowich, who introduced the report during an on-line news conference on Jan. 27, declined to comment on Jan. 30.
The ATC report and CP’s response come at a sensitive time for the federal government.
Ottawa recently launched a federal review of the Canada Transportation Act (CTA) and is under considerable scrutiny to address what agricultural shippers consider unreliable and inadequate rail service.
With railways and shippers offering two distinctly different assessments of railway performance, attention is now squarely focused on the CTA review process and Ottawa’s response to it.
The optics of using a federally funded report to lobby Ottawa for shipper-friendly rail policy has raised the ire of Canada’s major railways.
Canadian National Railway has also criticized the ATC report, saying it overlooks the fact that Canada’s largest railway companies moved record amounts of grain to market position last year.
In a Jan. 27 email, officials from CN said their railway hauled more grain during the 2013-14 crop year than ever before.
Performance so far in the 2014-15 crop year is ahead of last year’s pace.
“CN is fully in sync with the grain supply chain in Western Canada, where end-to-end balance has been restored,” the CN email stated.
“So far, nearly half-way through the 2014-2015 crop year, CN has spotted 16 percent more grain covered hoppers in Western Canada than in the last crop year when Canada reached an all-time record for grain exports.”
At the Jan. 27 Ag Transport Coalition news conference, Sobkowich, who is executive director of the Western Grain Elevators Association, said that the coalition was formed in response to “a tremendous lack of transparency in basic rail performance metrics on grain transportation in Canada.”
The coalition’s first report was based on information provided by more than 15 grain shippers, representing more than 70 percent of total grain movements in western Canada.
“Up until this point, both government and the industry really had only railway data to rely on to benchmark performance metrics,” Sobkowich said.
“Now we have a robust and credible source of quantitative data to ensure that a clear and complete picture of rail performance and grain transportation is available.”
Harrison said the Ag Transport Coalition should look broadly at the supply chain and seek input from other links in it, including ports, elevators to terminals.
“It is our belief that any discussions about commodity movement should include all pieces of the supply chain puzzle,” he said.
