Shippers of grain and other commodities plan to lobby the federal government next week for new regulations to protect shippers and improve rail service.
A coalition of shippers is expected to meet with Transport Canada officials in Ottawa May 5 to present a wish list of proposed amendments to the Canadian Transportation Act.
“We’re trying to get changes to the rules that will inject a higher level of railway service and accountability into the system,” said Wade Sobkowich of the Western Grain Elevators Association.
The elevator association was one of a number of shipper groups that met in Winnipeg last week under the auspices of the Western Canadian Shippers Coalition to develop a co-ordinated strategy for the lobby effort.
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The coalition includes the Canadian Wheat Board, the Canadian Oilseed Processors Association and the WGEA, along with groups representing shippers of fertilizer, forest products, chemicals, cement and sulfur.
Coalition chair Ian May said the level of rail service across the country is at an all-time low, and there doesn’t seem to be anything that shippers can do about it under the current regulatory regime.
“We are dealing with two very powerful and aggressive monopolies,” he said of the two national railways.
“We know we don’t have competition, so we’re looking for ways to simulate it through regulation wherever we can, and where it can’t be simulated, to provide remedies and recourse for shippers when they’re treated badly.”
Rail service has become perhaps the biggest issue facing the grain industry in recent months, with industry officials complaining about poor performance, especially from Canadian National Railway, which has consistently fallen short of its own targets for providing rail cars to country elevators.
Shippers said last week that while they hadn’t settled on specific requests for amendments, several key issues must be addressed:
- While grain companies face financial penalties if they fail to meet certain standards set by the railways for unloading rail cars, there are no similar penalties for the railways when they fail to provide or pick up cars in a timely manner.
- The railways are free to increase tariffs and surcharges as they wish, with no mechanism for shippers to object or appeal.
- Launching a level of service complaint under the CTA is a cumbersome, time-consuming and expensive legal process that discourages shippers from taking action.
Agricore United chief executive officer Brian Hayward said the rules are tilted in favour of the railways and must be rebalanced.
“We want the government to amend the CTA to provide for a fast, effective dispute resolution system,” he said.
Previous Liberal governments twice introduced legislation to amend the CTA, but both bills died when elections were called.
Those bills provided for final offer arbitration to settle disputes between shippers and railways, set maximum rates for inter-switching and made it easier for a shipper to take a complaint to the CTA.
However, they did not propose the introduction of reverse onus running rights, which some shippers say is the key to developing competition between the railways.
Transport Canada spokesperson Cathy Cassaboon said the department is aware of shipper unhappiness, but has not yet decided what amendments it will bring forward or when that might happen.
