Farmers’ grain should soon be moving faster because of an agreement struck between the Canadian Wheat Board and Canadian Pacific Railway, says the board.
Performance measures have been agreed by both sides and each will try to hit targets and improve the railway’s service, which even CP admits has been poor this winter.
CPR has so far moved about 25 percent less CWB grain this crop year than last. At the same time, CN has been winning praise from the board and other shippers for better performance and better co-operation.
“That’s almost two months difference in total grain movement,” said CWB chief operating officer Ward Weisensel.
“We’re quite pleased that we have now entered into an agreement with CP that puts in place measures and parameters that make us a lot more comfortable that we can get the job done by the end of this crop year.”
CPR said the agreement shows it is committed to improving its performance and that it willingly works with shippers and business partners.
CPR was surprised around harvest time by the large size of the 2010-11 crop, which had previously looked smaller to many crop forecasters, and did not have enough people and machinery arranged to handle it, the company has said. It brought in extra capacity, but then bad winter weather stopped it from catching up.
The CWB has been an outspoken critic of CPR’s performance this winter, with its views echoed by organizations like the Western Grain Elevator Association and many commodity groups.
Federal agriculture minister Gerry Ritz mirrored the grain industry’s sentiments at the March 17 release of his government’s response to the Rail Freight Service Review, which proposed new legislation that would give shippers a right to negotiate commercial agreements with the railways if they chose.
“CP has had some problems. They haven’t taken us seriously…. If I have any words of advice for CP, it would be ‘Pull up your socks and get in this race,'” said Ritz.
CPR also recently completed an agreement with Viterra to improve shipping.
Weisensel said the board’s agreement with CP should alleviate some problems this year.
“What we have done with CP over the course of the last couple, three weeks, is a step in that direction – an important one,” said Weisensel.
Regardless of the present agreement, the CWB will continue to support proposed legislation that would improve railway performance.
“Our focus has been on getting operational effectiveness, improving supply chain capacity, but we have also been participating in that rail service review panel because that’s more focused around the longer term solutions that balance the power between railways and shippers,” said Weisensel.
“The agreement, which applies for the remainder of the 2010/11 crop year, will enable increased collaboration and service reliability in the transportation of western Canadian wheat and barley,” said Stephen Whitney, CP Vice President Marketing & Sales. “CP and the CWB have agreed to work collectively to optimize performance in the grain supply chain, including joint initiatives such as bulk scheduling and improved order sequencing.”
