Company hopes expanding elevator network will ease deliveries
Managers at CWB say they will continue to take grain deliveries at facilities owned by competing elevator companies.
However, they acknowledged that delivery opportunities at non-CWB elevators have been hit and miss and delivery challenges might not disappear overnight.
Delivery issues, combined with inconsistent car spotting at some producer car loading sites, has placed added emphasis on the need for CWB to increase its network capacity as quickly as possible.
Speaking to farmers Jan. 16 during Crop Production Week in Saskatoon, CWB pool manager Dave Simonot conceded that delivery opportunities and regional basis levels have been variable.
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“For those of you who have been delivering to the handling companies, I would say it’s been hit and miss,” Simonot said.
“Some companies are taking (CWB) grain at some locations and not at others. Some companies are taking it for a while and then they stop. And some are just not taking it at all.”
Producer car deliveries have also been problematic.
Car spotting has been unpredictable and placements in some areas have been weeks or months behind schedule.
“Some of you are using producer cars, and that’s been a very difficult and painful experience in the past year and a half,” Simonot said.
“For most of you, producer cars have not moved well.”
Gord Flaten, vice-president of grain procurement with CWB, told growers the company is working to expand its network capacity.
It has already acquired facilities in Saskatchewan, including Prairie West Terminal at Plenty, Sask., and Great Sandhills Terminal near Leader.
It also owns Mission Terminal at Thunder Bay, Ont., and is building high-throughput concrete facilities near Colonsay, Sask., Moose Jaw, Sask., Bloom, Man., and Ste Adolphe, Man.
The facility at Colonsay is already signing delivery contracts for this year and is expected to take its first grain deliveries of in July.
It will have a loop track capable of handling 134-car grain trains and will boast one of the fastest load-out rates in the industry.
Flaten said Colonsay will be capable of loading a 134-car train in 10 to 12 hours , which is the equivalent of four or five minutes per car.
Construction of CWB’s four new facilities will exceed $100 million, he added.
The projects will be financed through a combination of retained earnings and commercial debt.
“We are under construction at our first four elevators … and we have more to come,” Flaten said.
“We do also have some plans to have a west coast facility as well, so the vision is to have a full network of elevators across Western Canada with east coast and west coast terminal capacity.”
Flaten said some CWB customers have had a tough time delivering against their pool contracts.
CWB expects to re-negotiate commercial grain handling agreements with some competing elevator companies, but not all of them.
CWB’s other assets include short-line railways assets in Saskatchewan, more than 3,000 hopper cars, two newly acquired locomotives and a pair of laker-sized vessels, the second of which is still under construction at a shipyard in China.
The company’s first ship, CWB Marquis, is in Halifax.
brian.cross@producer.com
