Short-line railways are usually designed to save local rail service and help farmers get grain to the main line.
But one potential short line could help all prairie grain growers, says the Canadian Wheat Board.
The board has proposed setting up a separate railway company to move rail cars in and out of the port of Vancouver.
The idea of a port railway is included in a package of proposals put forward by the board in its latest submission to Willard Estey’s grain handling and transportation review.
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The board says setting up a rail company or a “specialized port logistics service co-ordinator” would reduce car turnaround times, increase port capacity, improve rail service to terminals and allow main line carriers to concentrate on long haul movements.
“This entity would have the sole objective of maximizing port efficiency and throughput,” said the board, adding it would handle all commodities and be paid for by all stakeholders in the port.
The port railway would pick up rail cars from the main line carrier at the yard and distribute them to export terminals. The board said this would eliminate interchange disputes, which sometimes result in inadequate rail service to terminals.
The board cited the example of Port Colborne, Ont., where a recently established port railway has resulted in better service, according to users at the port.
“This is to be expected, because short lines are able to achieve efficiencies in local service that main line carriers are not,” said the board.
Bob Harris, the board’s general director of transportation, rejected suggestions that setting up a separate rail company or port logistics co-ordinating service would add another layer of bureaucracy, regulation and cost to the transportation system.
“Is that regulation or just good management?” he said in an interview. “I say let’s have the best possible management structure we can for the system in order to get every last dollar for the farmer.”
Ian La Couvee of CP Rail said the railway couldn’t comment on the port proposal without knowing more details.
“We are not against anything that’s going to make the grain logistics more efficient but we’d like to see how they would propose that operation working,” he said.
The port logistics co-ordinator is just one of 10 proposals the CWB put forward to Estey:
- Car Allocation – Allocate cars to companies on the basis of their grain handlings in the last one or two months, rather than the previous 12 months as is now the case, or based on the tonnage farmers have committed to that company through contracts.
- Financial Incentives – Institute financial rewards for efficient car loading, replacing the system of car penalties for poor performance. Rewards would also be paid for timely deliveries.
- Tendering – Make more use of tendering to draw in small volumes of grain needed to meet specific sales to niche markets.
- Competitive Rail Access – Put more competition into rail transportation and provide shippers with access to alternative carriers in moving grain to market, through such things as joint running rights.
- Scheduled Train Service – Regularly scheduled grain trains would allow for better planning and marketing by everyone from farmers to exporters.
- Railway Service Agreements – Railways would sign contracts guaranteeing a certain level of service at country and terminal elevators during specified times. Incentives and penalties would be involved.
- Regulated Freight Rates – The railways’ duopoly requires continued government regulation of freight rates that reflect variable costs and provide a reasonable return for the rail companies.
- Terminal Handling Agreements – Contracts would set out responsibilities in moving CWB grain through export terminals and onto vessels, with financial rewards and penalties.
- Information Flow – Develop a system to gather and distribute information on car orders, car spots at primary elevators, loads on wheels, car arrivals at port and cars spotted for unload.
