Frustration building Railway targets are being met, but producer car orders are still months behind schedule
Prairie grain is flowing to export position at a near-record pace, and Canada’s major railways are consistently meeting the million-tonne-per-week targets that Ottawa put in place earlier this year.
However, that is cold comfort for Saskatchewan grain grower Glynis Oliver, who farms with her husband, Chris, near Speers, Sask.
Earlier this year, the Olivers contracted three rail cars of wheat to CWB.
The couple were told that their producer cars would be delivered in mid-June to a loading site at Hamlin, Sask..
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However, the cars still haven’t arrived, almost five months later and more than a year after the Olivers harvested the grain.
Farmer frustration is mounting.
“It’s a gong show,” said Oliver.
“Nobody can tell you when the cars are coming. And when cars do arrive, nobody seems to know who they belong to. Nobody can tell you anything.”
Sensing a breakdown in the producer car delivery system, the Olivers have since attempted to deliver some of their CWB-contracted grain to elevator companies with facilities in North Battleford, Sask.
No luck.
Despite the fact that CWB has — or at least had —Â commercial grain handling agreements with competing elevator companies such as Cargill, Viterra, P&H and Pioneer, none of the companies would agree to take delivery of the Olivers’ grain.
Each company offered a slightly different explanation, but the end result was the same: no delivery opportunities for CWB grain.
CWB is now allowing some producers to back out of delivery contracts and sell their grain to competing grain companies.
It’s the best option available in a bad situation, but it’s not ideal for farmers or for CWB.
Many farmers are attracted to the prices offered through CWB’s pooling programs, but they simply can’t take advantage of the opportunity.
For CWB, the result of each broken contract is another lost sale and another frustrated farmer.
That’s a big deal for a company that is navigating its way through a government-imposed privatization process.
The Olivers are not alone in their frustration.
Oliver knows one farmer near Hafford, Sask., who is still waiting for cars that were supposed to be delivered in late February.
Remi Gosselin, a spokesperson for the Canadian Grain Commission, said his organization is working with Canada’s major railway companies to ensure the timely delivery of producer cars.
Gosselin said the demand for producer cars increased dramatically in early 2014.
“Last year, I think we had 21,000 producer car orders, the likes of which had not been seen in recent memory,” he said.
Of those 21,000, approximately 16,000 orders were sent to Canadian National Railway and Canadian Pacific Railway. However, it is not clear how many of those cars have been delivered.
Gosselin said the grain commission has no control over when producer cars are spotted in the countryside.
It is responsible for processing producer car applications and sending orders to the major railway companies, which is known as allocation.
However, it has no say in when allocated cars are delivered to producer cars sites.
As well, there is no reliable way to track the difference between the number of cars allocated or ordered and the number of cars delivered to producers.
“We only track the number of cars that … are ordered,” Gosselin said.
“CGC is not responsible for spotting. What I can certainly say, though, is that we’re working with the railways to address the backlog and that means improving the allocation process and seeking information on (the status) of producer cars. But in terms of spotting, again, the CGC is not in control of those cars.”
CN declined to comment about the backlog of undelivered producer cars.
Oliver said CN’s automated system for tracking the status of individual producer cars has been of little help.
“We’re told to check the CN website every Friday … and type in the platform ID number and the order reference number that we’ve been provided for each car,” Oliver said.
“Every week it tells you the same thing: shortfall.”
Inquiries to CN’s producer car hotline have also failed to provide useful information on the status of her cars.
“I’ve been told so many times that we’re next on the list … I just don’t believe it any more,” she said.
“Two or three producer cars don’t matter to CN. Obviously, they’re going to want to deliver 100-car trains to main-line locations because it’s … the easiest way to make money off moving that grain.
“I don’t know what kind of a carrot or a stick you’d have to use to get them to come out to our more remote locations.”
Statistics provided by the grain commission show that it has handled nearly 11,600 producer car applications since Aug. 1.
That number includes nearly 3,500 car orders submitted to major railway companies, 6,700 car orders that have been processed but have yet to be sent to railways and 1,400 applications that have been cancelled, rejected or are pending acceptance.
