Farmers looking to save their rail line – and save some money at the same time – were back in action last week in west-central Saskatchewan.
This time, about 80 producers got together to load 33 producer cars along a stretch of rail line near the Alberta border.
It’s all part of an ongoing effort by area farmers and business leaders to save some 405 kilometres of track from being abandoned by CN Rail.
But it’s also a way for those farmers to put a few extra dollars in their pockets.
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“There’s a significant amount of money to be made by loading producer cars,” said Jim Martin, a farmer from Laporte, Sask., who loaded some of his No. 1 Canadian Western amber durum wheat for shipment to Vancouver.
By avoiding elevation charges and maybe getting better grades and dockage, farmers save in the range of $700 to $800 a car, or up to $10 a tonne.
“In this business these days, that’s significant,” said Martin. “It’s a matter of principle in trying to save the line, but there’s also some money to be made at it.”
Producers along the network of lines that runs from near Saskatoon to the Alberta border are shipping farmer-leased cars as a way of demonstrating to the railways, grain companies and transportation regulators that there is strong support among farmers for keeping the line open, and that the line is financially viable.
A group of farmers and business leaders called the West Central Road and Rail Committee gained attention when it put together a 100-car train of durum wheat in early December.
Last week’s loadings were at the western end of the line, which wasn’t included in the December shipment. Rail service was discontinued on that portion of the line last fall, and public pressure forced the railway to provide cars. Similar pressure also overcame opposition from elevator companies along the line, said Martin.
The committee is now working on a proposal to buy the lines from CN Rail and operate a short-line railway.
Committee secretary Bill Woods said the group has recently received the first draft of a business plan prepared by Travacon Resources Ltd., a transportation consulting company based in Washington state.
“The consultant says it is viable,” he said, based on a detailed analysis of the amount of grain produced and shipped out of the area, and the profit potential for a short-line railway.
Woods said the committee expects to begin discussions with CN this month. Under the rules governing rail-line abandonment, the committee has until late June to negotiate the purchase of the track. The group will likely initiate a public offering to raise funds.
Martin said by shipping producer cars along the line, farmers are extending the line’s active life, while efforts are made to buy the track.
“If we can just delay things until that time, I think we will have accomplished our purpose,” he said, adding the steady demand for producer cars has also prompted elevator companies to assist in the producer cars and order their own cars as well.
“That run of producer cars has cost the grain companies a considerable amount of money,” said Martin. “I think this has put pressure on them to get their act together and start using those elevators.”
He added that when the farmers were arranging for the producer cars, CN offered to pay them $2.50 a tonne to truck their grain to the main line to the north instead, an offer that was rejected.
