WINNIPEG – A new report on how to keep the port of Churchill alive sees canola, peas and lentils as providing a future “surge in new traffic” for the port.
But two organizations dealing with these crops are skeptical.
“I don’t see them (special crops) as the light at the end of the tunnel for revitalizing Churchill,” said Gordon Cresswell, chair of the Saskatchewan Pulse Crop Development Board, who had not yet seen the report.
Cresswell and other special crop and canola growers said the physical improvements needed to get their crops to Churchill are daunting. They said even if the improvements are made, there’s no guarantee their customers will want to use the port.
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The report of the Churchill Task Force states that Churchill is the shortest route to the important special crops markets of northern Europe and Brazil.
The report said it would also be the cheapest route, if there were at least 800,000 tonnes of crops and 690,000 tonnes of other freight shipped through the port by the year 2000.
Economist Heather Gregory, a consultant to the task force, said 5.3 million tonnes of canola and special crops could be competitively priced for delivery to northern Europe, and 1.6 million tonnes to Brazil, given the current 14-week season.
Environment changing
She determined the figures by adding together the full cost of moving crops to various ports, ocean freight rates, and an extra $1 per tonne for shipping through Churchill.
Gregory knows there are skeptics, but she said “you’re living in a changing environment and it’s not necessarily market changes but also policy changes that will cause a very dynamic environment …”
The report states the Canadian Wheat Board, which was represented on the task force, does not expect to ship more grains through the port than it has during the past few years.
Doug Jones of the Manitoba Pulse Growers Association had not yet seen the report, but said freight cost is going to be a prime concern in a post-Crow rate environment.
“If Churchill can generate the volumes to make it a reasonable alternative, I think that’s just super,” he said.
Nick Underwood of the Canola Council of Canada said he has one important question about the report: “If they’re going to have to pay us less for the product in order to pick it up there, then we’ve got a problem.”
Both Underwood and Cresswell say the Canadian Wheat Board has only been able to ship grains through the port because it offered customers a discount. The cost of this discount is borne by producers through pooled prices.
“As a producer of pulses, I’m not prepared to take a discount just to support Churchill,” he said.
Gregory said she believes buyers will go to Churchill if it’s cheaper, and based on her analysis, it will be as long as hopper cars can move through the line.
Preliminary results of a CN study show aluminum hopper cars may work on the often-unstable line. Test runs are scheduled this fall.
Timely delivery important
Timely delivery is another factor as customers often require the crops at specific times.
“Churchill is an obvious point to get to Europe, but it doesn’t work very well in January,” said Underwood.
Cresswell said Churchill would require “tremendous revitalization” before special crops could be shipped through it, since it was built to handle cereal crops.
For example, he says Churchill isn’t equipped to handle the containers that many special crops are shipped in and the terminal may not be able to provide consistent samples of pulses free from foreign matter.
Cresswell said the port should handle cereal grains at its full capacity before trying special crops.
