Special crop shippers say they are reluctant to complain about railway service for fear of reprisal, an allegation senior executives at the country’s two national railways contend is unfounded.
An Alberta pulse crop processor, who requested anonymity, said he wanted to confront the railways about something he heard at the recent Canadian Special Crops Association meeting in Lethbridge, but was too scared to speak up during the question and answer session.
What raised his ire was a comment by Judy Harrower, assistant vice-president of agribusiness with Canadian Pacific Railway, who told delegates there were too many shipping origins for special crops.
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She said there are 120 shipping points for canola and board grains, which comprise 92 percent of the company’s grain-related business, and another 100 shipping points for special crops, which make up the remaining eight percent of CPR’s handlings.
Harrower said there needs to be consolidation so special crops start moving in larger blocks of shipments from fewer origins.
“Frankly, this will result in efficiencies for the industry. It will result in faster transit times and an improvement in the overall cycle,” she told the CSCA delegates.
The processor wanted to take issue with Harrower’s assertions.
“That really bugs me when they say stuff like that,” he said during a telephone interview following the Lethbridge conference.
“Trains are inherently far more efficient than trucks, so why are we doing more trucking and less training?”
He wanted to ask Canadian National Railway’s representative, Wayne Atamanchuk, if his company was also pushing for consolidation, since the shipper’s plant is on a CN line.
And he wanted to complain about how, for a six-week period last year, his company received only five percent of the cars it requested from CN.
But instead of grabbing the microphone and voicing his list of concerns, the pulse processor kept his mouth shut.
“Like everybody else I’m afraid of backlash from CN,” he said. “And it will happen.”
Mark Hemmes, president of Quorum Corp., Canada’s government-appointed grain transportation monitor, said that kind of comment is indicative of the culture of fear that is prevalent among small- and medium-sized grain shippers.
Hemmes, who just completed a study on special crops grain movement in which he talked to 29 shippers, estimates about half of the country’s grain exporters have stories where they feel they have been subjected to strong-arm tactics by CN and CPR.
“A lot of people truly believe that if they piss off the railway all of the sudden their transportation capacity that is tight today is going to disappear tomorrow.”
He said those suspicions are probably 90 percent perception and 10 percent reality. What he suspects is happening in a lot of cases is asset management by the railways that is being interpreted as punitive action.
“People feel threatened by something they don’t understand and I think that’s a large part of it,” Hemmes said.
“They view the behaviour of the railways being a personal affront when they’re basically screwing everybody.”
CN spokesperson Jim Feeny said the allegations of reprisals are absurd.
“We’re kind of at a loss to understand why this kind of complaint would be made.”
He said a company that is unwilling to listen to its smaller customers would not send a representative to the CSCA’s annual meeting.
Feeny is perplexed by the allegations that railways are vindictive corporations because CN has a policy of encouraging shippers to come forward with complaints so they can be resolved on a one-on-one basis.
The response was similar at CPR.
“Hearing about a fear of reprisal from our customers is a surprising thing,” said Leslie Pidcock, CPR’s manager of corporate communications.
“Customer relationships are very important to CPR, they are part of the culture of CPR.”
Pidcock dismisses the idea that the railways operate as bullies, pushing their weight around.
“It’s a competitive business. We fight for all the business that we get. We’re out there trying to deliver a superior service.”
Marc Comeau, spokesperson for the Canadian Transportation Agency, which handles railway service complaints, said nobody in the office can recall a complaint containing allegations of railway reprisals.
However, according to the Alberta pulse crop shipper, the grain industry abounds with stories of processing plants that couldn’t get cars for weeks after lodging a complaint.
He said that monopolistic behaviour has led to a culture of fear in the grain shipping industry.
“I don’t have the option of taking my business across the street, so I’ve got to keep my mouth shut. I can’t speak up against bad service,” he said.
“They can treat anyone any way they want. The grain is all coming to them anyway.”
Hemmes said while suspicions of retaliation are overblown, there probably is some truth to the allegations because like in any business, there could be consequences for ticking off suppliers. Only in this circumstance the supplier happens to be the lifeblood of the businesses located along its tracks.
“Any shipper who doesn’t manage their relationship with their sole provider of transportation capacity is kind of a fool because the possibility for them to come up with any kind of excuse to short you on capacity is going to be there,” said Hemmes.
He said he suspects the railways are not eager to dispel the notion that there will be reprisals because it limits the complaints.
“It probably works to the advantage of the railways that people think that they’ll play the mean bastard,” said Hemmes.
Feeny rejected that comment as baseless.
