The Alberta Wheat Commission says grain shippers should be able to fine railways that fail to provide empty rail cars on time or move loaded cars as promised.
The commission is proposing fines of $150 to $250 per day against railways for delayed spotting of empty rail cars.
It also proposes fines of $100 to $150 per day, depending on seasonal demand, if railways fail to move loaded cars on time.
The fines are equivalent to tariffs now imposed by the railways on grain companies and other grain shippers for system delays.
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The recommendation is contained in the commission’s final submission to the Canada Transportation Act review panel.
The commission is also proposing measures intended to increase the use of interswitching provisions.
Interswitching allows one railway to use a competitor’s rail network, at a prescribed cost, to access grain that is waiting to be shipped.
“These recommendations quantify for the first time our vision for reciprocal penalties as a tool to increase railway accountability,” commission chair Kent Erickson said in a news release. “They will help level the playing field within the supply chain and generate efficiencies through competition.”
The commission said standardized reciprocal penalties will increase accountability by all parties in the grain transportation sector.
Without this change, farmers will incur unnecessary costs caused by delayed delivery opportunities and lower prices, Erickson said.
The commission would like to see the penalties implemented through standardized shipper asset use tariffs established by the Canadian Transportation Agency or standardized service level agreements (SLAs) between shippers and carriers.
