Transportation meeting | Leaders of Canada’s grain logistics system try to prevent another crisis
The leaders of Canada’s grain logistics system are getting together to prevent another crisis similar to what happened last year.
“This is probably the first time in many years that we’ve got everybody in the room together to say, ‘where are we going?’ ” Canada Grains Council president Richard Phillips said about the strategic planning process.
He said 2013-14 revealed flaws in the system and a lack of communication and co-ordination that he thinks the CGC-led process can fix.
“There’s a lot of things that we need to look at. How do we really make this system hum?” said Phillips.
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“There’s room for improvement, not just with the railways, but I think with the grain companies and ports as well. It’s everybody working together to make the system what it needs to be 10 years from today, 20 years from today.”
Eliminating bottlenecks and fixing flaws in the system isn’t as easy as it sounds, industry players say. The problems often don’t come to light until critical stresses such as the cold winter and huge crop of 2013-14 throw a harsh spotlight on them.
As well, the complex, multi-player system lacks long-range forward planning that could help all members determine how to prepare for future challenges.
That’s what the CGC process is intended to fix.
Farmer and commodity groups will be pushed to honestly assess where they believe their crops’ acreage and yields will be in five years and 10 years, rather than just provide aggressive hopes.
“What we need is for all these players to be together and say, ‘look, there’s only so many seeded acres in Western Canada. What is going to give?’ ” Phillips said.
“You can’t have two million acres of corn in 10 years from today and two million acres of soybeans that aren’t there today without some other crop acres going down.”
Markets will need to be carefully balanced so that grain companies, railways and ports have a better sense of the likely future flow of crops. Each crop has its own market destinations and dynamics, which affects what flows when and by which route.
As well, railways and ports will need to make sure they’re able to carry the loads as efficiently as possible.
For all the massive investments of recent years in rail, elevator and port capacity, there is still much improvement that can be made, said Phillips.
For instance, long shuttle trains are loaded at major grain facilities in the U.S. northern tier states and then head straight to port, unload, come back to the Plains, reload and head immediately back to port.
In Canada, the 100-car unit trains have to stop short of the mountains and add extra cars to reach the 150 to 170 car lengths that are sent through the mountains.
“There’s just a lot of efficiencies I see even across the line that we’re not doing today,” said Phillips.
“When that train leaves that terminal in Tisdale, Sask., it’s not pedal to the metal all the way to the ports.”
He said serious discussions are beginning this month and all parts of the industry seem committed to taking part. He’s been particularly pleased that Agriculture Canada appears gung-ho about it because the government sets the policy skeleton from which the body of the grain industry grows.
“Agriculture Canada is leading this with us,” said Phillips.
“They are probably the biggest supporters of this.”
