The ill-fated bid for railway running rights shows that the Prairie Alliance for the Future is on the right track, says alliance chair Kyle Korneychuk.
On May 3 the Canadian Transportation Agency threw out separate applications by Omnitrax Canada and Ferroequus Railway Co. to operate trains and pick up grain on CN Rail lines.
Korneychuk said the decision makes it clear farmers can’t depend on politicians or regulators to act in their best interests.
“We’ve gone down the regulatory road and you see where we’re at,” he said.
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“Just like always, farmers are going to have to find their own solution.”
The alliance, made up of farmers, local community groups and unionized railway workers, wants to take over operations on 1,600 kilometres of CN branch lines in Saskatchewan and Manitoba.
It wants to set up a grassroots, non-profit federation of local co-ops that would operate a regional grain collection, transportation and marketing system.
CN would lease the lines to the group on a long-term basis. The alliance would be responsible for operating trains and maintaining the track.
As of last week, the two sides were putting the finishing touches on a business plan that would set out the operational details, responsibilities and financial commitments of each party.
“Things are progressing as they should,” CN Rail spokesperson Jim Feeny said early last week.
“We expect to finalize it within a matter of days.”
Ron Gleim, chair of the Western Rail Coalition that promotes the development of short-line rail companies, said his group supports both the running rights applications and the PAFF.
The two together could have provided farmers along the lines in question with a commercial, competitive environment in both rail and grain handling, he said.
But he also wondered whether the CTA’s rejection of running rights might make CN less interested in going ahead with the PAFF plan.
“CN does not want short lines,” he said.
“They’ve made that very clear in the past. The only reason they’re talking to Prairie Alliance is because Omnitrax is there putting the pressure on, and we could have used them both.”
Meanwhile, an American grain industry official brought to Canada by PAFF said he thinks the alliance is taking the right approach.
Charlie Swayze, general manager of a farm co-operative in Kansas that operates grain elevators at six locations, said farmers in his state have lots of experience with deregulation and rail abandonment.
He said they have learned that corporations like Omnitrax aren’t interested in serving farmers. Producers must work together, get others involved, and try to keep local control.
“I’m not here to bad mouth Omnitrax,” he said.
“I’m not saying not all short lines can’t be trusted, but farmers need to be involved and work together.”
