Farmers and business leaders from northeastern Saskatchewan say better rail service to the Port of Churchill could deliver a huge economic benefit to the province.
At a recent meeting in Tisdale, Sask., members of the Hudson Bay Route Association heard that reopening the Canadian National Tisdale line, an unused section of railway that runs from Birch Hills, Sask., to Hudson Bay, Sask., would result in improved port access for agriculture, forestry and mining.
In an average year, the Port of Churchill, owned by OmniTrax Canada, handles about 600,000 tonnes of grain.
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The cost of moving grain from the Tisdale, Sask., area to Churchill is usually considered to be about $25 to $35 per tonne less than the cost of moving the same grain to a port on the West Coast.
Some members of the HBRA say federal plans to end the Canadian Wheat Board’s marketing monopoly on wheat and barley exports could significantly reduce the amount of grain moving through the Port of Churchill.
The CWB has already announced that it is no longer signing up grain in a program known as the Churchill Storage Program.
That program paid grain farmers in the Port of Churchill catchment area to hold back deliveries of No. 1 and No. 2 red spring wheat for delivery through the Port of Churchill the following calendar year.
The Port of Churchill has a short shipping season and limited storage capacity.
Grain that is contracted through the storage program must be stored on farm until ocean going vessels begin arriving at the port, usually in July or August.
In addition to receiving a $2.50 per tonne premium, producers who took part in the program received an additional storage payment of $1 per tonne per month for providing on-farm storage.
Brad Chase, president of OmniTrax Canada, said the uncertainty surrounding the future of the wheat board traffic could have a detrimental impact on the port’s overall volumes.
However, growing export demand in other sectors of the Saskatchewan economy could help to offset losses in CWB grain movement.
Exports of potash could grow significantly over the next few years.
According to Chase, Saskatchewan’s potash industry already exports a minimum of eight to 10 million tonnes of material every year.
That number could increase to as much as 15 million tonnes per year in the future if railways and port facilities can find the capacity to move that much extra material, he said.
“There is probably five million tonnes of (potash) production that doesn’t exist today that will need to leave the country (annually) to meet export demand,” he said.
“That is going to be an east-west move and it’s going to be a significant amount of tonnage. I’m not sure what railway capacity is there today, but it (potash expansion) is going to compete with grain.”
