OTTAWA — When CN Rail vice-president Sandi Mielitz appeared before MPs last week to talk about this year’s grain hauling mess, she said there is industry agreement on at least one point.
The practice by some grain companies or buyers to use rail cars as storage for grain that cannot immediately be moved to market should be penalized.
Storage of Canadian Wheat Board and non-board products have tied up as much as 10 percent of the CN car fleet for weeks on end, she said.
“There appears to be clear industry consensus that the railways be allowed to charge demurrage to shippers who delay the unloading of cars,” she told MPs.
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Beyond that, there was little agreement.
The committee hearings, designed to produce quick recommendations to the government on how to get the grain moving and customers satisfied, became a forum for conflicting views that have characterized the Prairie grain debate for decades.
Even on the basic question of whether the system is in a “crisis,” there was disagreement.
With the Seaway opening and the railways adding thousands of new leased cars to bring the rail car fleet up to record levels of more than 30,000 cars, there were assurances that the grain backlog would be cleared up by the end of the crop year.
Still, there were suggestions the congestion has cost farmers at least several hundred million dollars in sales and severely damged Canada’s reputation in world grain markets.
Evidence suggested that a number of factors combined to create the crisis.
- Extraordinary weather
- Shortage of cars for lease
- Union/management problems which have disrupted weekend loadings in Vancouver
- Inefficient use of some cars
- Increased volumes of specialty crops in the system
- Increased movement south into the United States where car turn-around times are double the Canadian average.
Possible solutions were more controversial.
The committee hearings offered an early glimpse of the positions that will dominate upcoming debate on the future of the Prairie grain handling and transportation industry.
To the delight of Reform MPs and some Liberals, many witnesses promoted a deregulated system, introduction of market principles or incentives and an end to “equity” as a guiding principle for car allocation.
Doug Campbell of the Canada Grains Council, Hubert Esquirol of the Western Canadian Wheat Growers Association, Paul Earl of United Grain Growers and in some cases the railways, teamed up to promote deregulation of the system.
Their proposals ranged from allowing a “market-driven car allocation process” and introduction of private cars for the exclusive use of the grain companies that provide them, to suggestions from some quarters that the Western Grain Transportation Act system be totally dismantled.
Is the problem too much government? asked Bloc QuŽbecois agriculture spokesman Jean-Paul Marchand.
“We have specialized in that for about 100 years,” replied Campbell. “I think it’s time to move on.”
It was “the first breath of fresh air in here for awhile,” said Manitoba Reformer Jake Hoeppner.
But while some MPs applauded proposals to reduce government control and to make sure union rules or practices do not hold up grain movement, others found the proposals stifling and dangerous.
Need more control
Roy Atkinson of the wheat board advisory committee suggested there is need for more central co-ordination in the system, not less.
He said a move toward the American system is not in the interests of Canadian farmers.
One of the growing problems is the unco-ordinated use of the rail system by specialty crops.
To those suggesting a massive overhaul of the system, the Canadian Wheat Board’s Bob Roehle replied: “We’ve got a migraine but we don’t need brain surgery.”
Along with the pools, the advisory committee called for penalties against the railways if they are responsible for not moving the grain.
