Ottawa is working to address grain transportation problems, but solutions will not occur overnight, says federal agriculture minister Gerry Ritz.
“There is no easy solution to this,” Ritz told The Western Producer in a Jan. 23 interview.
“We’re doing as much as we can and quickly as we can …,” he said.
“We want to see (grain) contracts honoured, we want to see as much product move as quickly as we possibly can and we want to see as small a carryover as we possibly can.”
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In recent weeks, the federal government has faced a growing chorus of critics who feel Ottawa should have done more to prepare for last year’s record harvest and the delivery problems that ensued.
On Jan. 21, Ottawa kicked in $1.5 million toward a five-year, $3.2 million industry-led initiative aimed at identifying problems and suggesting possible solutions.
Ritz also said the Crop Logistics Working Group (CLWG), established by Ottawa in 2011, will continue to supply information for a 2015 review of railway performance to be conducted by Transport Canada.
The CLWG was put in place to identify potential logistics issues stemming from the elimination of single-desk grain marketing in Western Canada.
Until Aug.1, 2012, the Canadian Wheat Board played a central role in co-ordinating grain movement and ensuring the orderly flow of grain to export position.
It remains unclear what impact the elimination of single-desk has had on grain logistics and to what extent it has contributed to current problems.
According to Ritz, the CLWG recently completed three reports, containing recommendations for improved rail service. Those recommendations are expected to be made public soon.
Ritz also said it is likely that Railway Revenue Caps, which limit the amount that railways can charge for moving grain, will be part of Transport Canada’s 2015 rail review process.
“I’m certain that Transport Canada in their 2015 review would have that on the table,” he said.
“I don’t think anything should be off the table when you’re talking about a review but having said that, there would have to be other safeguards in place.”
Liberal MP and former agriculture minister Ralph Goodale referred to the current situation as a “costly, frustrating mess” that is costing farmers millions of dollars in lost sales revenue and demurrage charges.
The Fair Rail Freight Service Act, Ottawa’s most recent legislative attempt to improve railway performance, “is a joke,” he added.
In a Jan. 23 interview, Goodale said logistical issues plaguing grain shippers should have been anticipated and addressed long before the elimination of single-desk grain marketing.
“When the government was beginning the process of making very large changes in the western grain marketing, handling and transportation system …, we asked (Mr. Ritz), have you got a business plan in place to manage this whirlwind of change and … to make sure that nothing falls off the table inadvertently here?” Goodale said.
“The answers that came back were pretty clear. There was no cost-benefit analysis. There was no business plan and there was virtually no consultation. Now I think we’re seeing the chickens come home to roost.”
Goodale said the recently announced logistics study might generate useful information, but the onus will be on Ottawa to take action.
“The study hopefully will bring forward some useful information but the critical thing is whether the government is actually going to do anything about it.”
Ritz brushed off the suggestion that Ottawa should have done more to prepare for grain transportation problems that critics say were inevitable.
“It’s always easy to take cheap shots from the side,” Ritz said.
“Having said that, no one in Canada, even as late as July, could have foreseen the size and scope of the crop.
“Going into seeding, those same people screaming now about the size (of the crop) were the same ones telling me it was a crop failure.”
