Transportation has once again taken centre stage in the grain industry.
This time, at least on the surface, it’s not a debate about long-term policy reforms. It’s a debate over how well the system is working on a day-to-day basis.
Last week saw a flurry of charges and counter-charges centred around the movement of grains and oilseeds through Canada’s West Coast ports.
And as usual, the Canadian Wheat Board found itself at the centre of the maelstrom of conflicting claims.
Here’s some of what was said:
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- The Western Canadian Wheat Growers Association accused the board of plugging export terminals, preventing private shippers from filling orders for non-board crops and forcing them to pass on 200,000 tonnes of potential canola sales worth $60 million.
- The wheat board said it’s not responsible for problems experienced by canola shippers and denied that stocks of CWB grain were high. The board said it sold to its allocated capacity, while canola merchants oversold their allocation, incorrectly gambling that they would be able to get more capacity.
- Saskatchewan Wheat Pool said it handled significantly less grain in the first quarter of this crop year versus last year, partly because the wheat board put a priority on moving grain out of Alberta at the expense of Saskatchewan farmers and shippers. The board said that reflected current market demand and will balance out with time.
- CN Rail said congestion at terminals in Thunder Bay, Ont., caused by a lack of vessels picking up grain, resulted in inefficient use of rail cars. At least 400 cars were waiting to be unloaded daily, with the number reaching as high as 1,000.
Some proponents of transportation reform say the situation shows it’s time to end the wheat board’s role in transportation.
“This is more, and we believe pretty strong, evidence that the system doesn’t work and the CWB’s role in transportation is just misguided,” said CP Rail spokesperson Ian La Couvee.
However, CWB director Ian McCreary, chair of the board’s transportation committee, said the criticism of the board is prompted more by political posturing than practicalities.
Those who want the board out of transportation fear they are losing the battle for support in Ottawa, he said, and so have resorted to blaming the board for problems they created for themselves.
“This is totally irrational,” he said. “It looks like a desperate attempt to put a different spin on that debate.”
Good performance
The wheat board said the bottom line for farmers is that exports of CWB grain are 1.1 million tonnes ahead of last year, farmers are earning despatch for exceeding performance standards in export contracts and exports of the six principal grains out of the West Coast in November set a record.
Critics say because total grain movement and export numbers are ahead of last year, that doesn’t mean the system is performing as well as it could.
CN Rail surpassed west coast unload targets throughout November, and said in a news release it’s making better use of its cars, locomotives and other assets than ever before.
But railway spokesperson Jim Feeny said that’s due to internal changes in railway operations, not the system.
“As a railway we’ve performed, but we’re just part of the system and we think there is potential for much more,” he said.
Frank Burdzy, acting head of Sask Pool’s grain group, said part of the problem is that the late harvest meant a late start to export programs, so both board and non-board shippers are looking for capacity at the same time.
He added that no matter what kind of system is in place, problems will arise: “If you have a limited pipeline and you’re trying to push more through than can travel through, then from time to time you’ll have difficulties.”
