VANCOUVER – The longshoremen are back at work, the railways have an almost record capacity of railway cars on track, and the weather no longer impedes shipments to the West Coast.
However, approximately 40 ships are collecting demurrage of $10,000 or more per day in the harbor just outside the port of Vancouver, waiting to be loaded with grain.
While terminals such as Sask Wheat Pool have the ability to fill up two ships a day, officials admit there have been days when no ships were loaded.
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Problems being discussed
Last week’s annual meeting of the Canada Grains Council led many industry players, ranging from farmers to the people arranging for vessels to load grain, to discuss why Canada is having problems filling the ships.
Grain is arriving at port, the labor is there, the ships are ready – but the wrong grain is arriving at port, partly due to lack of communication between country elevators and the port terminals, officials said.
Sometimes at the microphones, but mostly during private conversations outside meetings or during an off-the-record bearpit session, stakeholders showed some of the frustration and confusion that exists in the industry.
Discussion also showed the need for various players in the industry to open communication and work together in meeting off-shore market demands.
Port of Vancouver officials and others emphasized there is a sense of urgency to deal with Canada’s grain transportation system.
Jane Frost, vice-chair for the Vancouver Port Corporation, said the port is feeling besieged. As landlords for the grain facilities here, the port is pleading for action from the grain industry as it faces “having ships piling up, and where to put them.”
However, her impression from the annual meeting is that people don’t realize the urgency of the problem.
Brian Oleson of the Canadian Wheat Board agreed with Frost. “There’s no sense of urgency here,” because people still feel the problem will disappear. On the contrary, “there’s a tremendous urgency here,” he said.
In an interview later, Frost said events conspired against the grain industry this year and showed weaknesses in the system.
“We have labor issues, car allocation, and the wrong stuff in houses and cars. There’s backup and breakdowns.”
She said those in the industry must forget their particular interests and resolve their differences.
“Overall it’s a good system, it just needs to be fixed,” she said, adding that some regulations add to difficulties. “The industry needs to get its act together, and we need the government to listen and get on with it.”
While selling agents are feeling the pain already as they fail to make shipments, “I don’t think farmers have really felt the impact yet,” Frost said.
Shortage of railway cars was one problem. “The immediate problem is getting enough grain to port to meet sales projections,” said Alex Conradi, general manager of marketing grain for the CP Rail system.
More rail cars added
CP added 3,000 cars to its fleet: 1,000 were added two weeks ago and 1,000 will be added in late April. The last third will arrive in May.
Conradi said it won’t be the highest number of cars CP has ever had, but because hopper cars have replaced box cars, it will be record capacity.
This year was a worst case scenario for the grain industry, and everyone is dealing with it. But for the longer term, “any crisis of the kind we’re in now must have everyone involved … and take a hard line to look at system changes,” Conradi said.
From the railway’s point of view, the big issue is not method of payment, but efficiency in the system, he said. There also needs to be reform of the branch line network and more high throughput concrete elevators.
Conradi said the problems go back to the fall: “We need to try and focus more on loading of grain at larger inland terminals, with people willing to work on weekends. We require co-operation of the industry players.”
