Canadian National went on the offensive last week to show farmers and grain companies how the railway has shared gains during the past four years.
Meeting first with two of the three working groups that are coming up with ways to implement the Estey report, and then with reporters and other groups, CN officials said they wanted to put their facts on the table.
“We believe that many of the arguments that have been put forward are inaccurate,” said Peter Marshall, vice-president, prairie division. He declined to elaborate.
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Sandi Mielitz, vice-president of grain and fertilizers, said CN shared $190 million in rate reductions and cash payments with farmers and shippers since 1995.
In 1998, she said savings worked out to $5 per tonne of export grain shipped on the railway, or $60 million.
The officials said CN is prepared to have its figures verified by an independent source, such as the Canadian Transportation Agency, to alleviate skepticism.
The figures do not include an undisclosed settlement made with the Canadian Wheat Board after the board complained to the CTA about rail service in 1996-97.
The wheat board and other groups have claimed the railroads are now saving $200 million a year.
Mielitz would not say how much CN is saving in total, explaining she thinks it would be “unproductive” to release a number.
Last week, transport minister David Collenette announced the CTA will analyze current rail transportation costs.
Mielitz welcomed the review, saying it will be “more powerful” for the CTA to announce costs, rather than CN to release the information.
Since the end of the Crow rail subsidy in 1995, Mielitz said railways have faced more competition.
Almost 75 percent of grain delivered to CN lines is within 50 kilometres of a CP or BC Rail line, she said.
“Farmers have an opportunity to move their business around quite freely,” said Mielitz.
Grain companies can swing 11 million tonnes of grain between the two main railways, she said.
To compete with CP, CN discounts one-third of its regulated rates down from the maximum rates. And in 1998, more than 20 percent of grain delivered to CN lines was moved under incentive rates for large blocks of rail cars.
Incentives offered
The railway shares benefits with farmers by offering incentive rates to the wheat board to ship through the port of Prince Rupert.
And its rates have dropped because it has abandoned some branch lines, she said.
The new network of high throughput elevators under construction, along with a more commercial system, will help the railway deliver more savings to farmers and shippers, she said.
CN has spent $214 million on capital projects since 1995 to make its grain transportation more efficient, said Mielitz.
The wheat board will be carefully examining CN’s numbers, said director Ian McCreary.
“It’s hard to unpack their numbers in a very short time period,” he said.