SASKATOON – Grain transportation woes are hitting grain farmers directly in the pocketbook, say Canadian Wheat Board officials.
The board says it can’t take full advantage of high world grain prices because the pipeline from farm to export vessel is backed up.
With wheat futures markets in the U.S. showing a drop of more than $20 a tonne from March to July, and another $20 decline by fall, the backlog could prove costly.
“This is going to cost us big time, and it’s all farmers’ money,” said board policy director Harvey Brooks.
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He said if the board could move grain through the system more quickly, it could be selling more.
The marketing agency called in grain shippers and railways last week to talk about ways to improve the flow of grain from country elevators to waiting ships.
It was agreed that once the weather improves, special shipping programs will be developed to identify what grain is most needed at export position, locate supplies in the country and get it to port as quickly as possible.
So far this crop year, grain cars unloaded at Vancouver and Prince Rupert have averaged 3,500 per week.
“That’s not very good,” said Lorraine Dodick, car allocation co-ordinator for the Western Grain Transportation Office.
A committee of senior executive officers involved in the grain handling industry has set 5,100 cars as the weekly unload target, although Dodick said a more realistic goal is around 4,700 cars.
The year is turning out to be a strange and difficult time for grain movement. For the first 10 weeks of the crop year, there wasn’t much grain in the country, so there wasn’t much to ship to ports. Since then, unloads have averaged a more respectable 4,200.
In December, heavy rains disrupted the loading of vessels at Vancouver. Then Christmas holidays resulted in the usual slowdown. The railways say they have also had to deal with an unusually high number of derailments.
Cold halts movement
Things were just starting to improve in January when the cold weather hit. The unrelenting Arctic blast has slowed grain movement to a crawl for the last three weeks.
Dodick said only in the last couple of weeks has any sense of urgency developed about the shipping problems. Even now, the shipping program for non-board products like canola doesn’t seem to be suffering too badly. But concern is growing about wheat and barley, with the board about one million tonnes behind where it had hoped to be in its export program.
“The program has slipped over the last month or so,” said CWB commissioner Gordon Machej. “There are some vessels that probably have been waiting a few weeks so we are unfortunately facing some demurrage charges.”
He said the board hopes that increased use of directional loading and solid trains, along with weekend loading in the country and weekend work at export terminals, can reduce car turnaround times and get the export program back on track.
Exports of the six major grains and oilseeds in the first 25 weeks of the crop year to Jan. 21 totaled 11.2 million tonnes, down 28 percent from the previous year. Wheat and barley shipments are down 10 percent. Rail car unloads were down 23 percent at Vancouver and 42 percent at Prince Rupert.
