The federal government and the grain industry have agreed to launch a review of the grain handling system late this year which could revolutionize the system.
The industry-led, government supported review will examine virtually all aspects of how grain is handled and moved. It is expected to start late this year, report by next year and trigger required legislative changes in 1999.
“There could be radical change flowing from this,” Canadian Wheat Board minister Ralph Goodale said July 28.
At a Winnipeg meeting between federal ministers and industry leaders July 25 when the review was approved, some suggested it should simply look at ways to fine-tune the current system.
Read Also
Canola oil transloading facility opens
DP World just opened its new canola oil transload facility at the Port of Vancouver. It can ship one million tonnes of the commodity per year.
“But there were a significant number of speakers, including some who would historically have been in the cautious camp, who said it really is time to think outside the box, the box being conventional wisdom,” said Goodale.
Regulated or market driven
One of the issues up for review will be whether the grain handling system should be changed from a regulated to a strictly commercial system based on bargaining and contracts rather than central car allocation and wheat board planning.
“I really think this review should take the view that it is time to leave the regulated system behind,” said Kevin Archibald, vice-president of the Western Canadian Wheat Growers Association.
Saskatchewan Wheat Board president Leroy Larsen, who also attended, agreed it will be one of the ideas considered, although Goodale cautioned that a totally commercial system may not be appropriate for grain movement, that does not always offer shippers access to competing carriers.
Reform party agriculture critic Jay Hill said the wheat board should be removed entirely from the car allocation process.
“Right now, I just think there are too many layers of bureaucracy and farmers are caught in the middle,” he said. “I’d like to see the wheat board given an at-port role but let the market get the grain to port.”
The review, which will be set up by transport minister David Collenette, also will consider whether the existing maximum grain freight rate cap should be scrapped, whether there are more competitive and cost-efficient ways to move grain and whether management of the system should be reformed to accommodate changing market needs.
Goodale said the one area it will not be allowed to consider is the grain marketing question and the wheat board’s jurisdiction.
“This is about grain handling and transportation,” he said. “It is not about grain marketing.”
David McGovern, director of rail policy at Transport Canada, said July 28 that the long-term review cannot begin until the Canadian Transportation Agency renders a decision in a complaint brought by the wheat board against the railways over last year’s grain hauling performance.
A ruling is expected this fall.
However, he said Collenette already is consulting about the scope and structure of the review, its terms of reference and membership.
It will not be a formal inquiry, complete with lawyers and legalities. It will be an inquiry that studies the issue through “ongoing consultations and communications” with all sectors of the industry.
“Minister Collenette has been clear that we will wait for the CTA process to finish but he wants to be in a position to move quickly when that happens,” said McGovern.
