Provincial government and local producers welcome grain announcement

After months of complaints from farmers, the federal government is introducing an order-in-council forcing railways to step up their game.

Transport Minister Lisa Raitt says that minimum will be set at 500,000 tonnes, which works out to 5,500 grain cars each for Canadian National and Canadian Pacific. There will also be penalties of up to $100,000 a day if the rail companies fail to meet the requirement.

The Saskatchewan government has been vocal about its frustration with a lack of rail service.

“In an ideal world they should have been ramping up without this threat of legislation,” said Saskatchewan Agriculture Minister Lyle Stewart. “The railways certainly have the capacity to deliver these numbers and more.”

The new rules give railway companies a four-week window to increase their efforts.

A provincial producers group welcomes the order but cautions it’s just the first step.

“It’s a short-term solution to at least hold them tight to a plan,” said Todd Lewis, vice president of the Agricultural Producers Association of Saskatchewan. “But, certainly no, 5,500 cars a week won’t be enough to catch up on the backlog.”

The feds also announced it will introduce emergency legislation, in about four-weeks time. The Saskatchewan government hopes to increase the required number of grain cars from 11,000 to 13,000 per week.

“Those service level agreements need to be mandatory. There needs to be reciprocal penalties in them,” said Premier Brad Wall. “This is a good next step and now let’s make sure that we get the legislation right.”

The provincial NDP released a statement saying the $100,000 fine is a small price to pay for massive corporations and the number of required grain cars is not enough.

Liberal MP Ralph Goodale said the new rules lack substance and will mean “business-as-usual” for railway companies.

CP Rail released the following statement:

“Canadian Pacific is disappointed with this unfortunate order in council.  CP believes the actions of the federal government raise more questions than they (sic) answers and only focusses on the railways and not the entire supply chain. CP’s position remains that moving grain from the farm to the port is a complex pipeline involving many parties and requires all participants of the Canadian grain handling and transportation system to work together, which requires a 24/7 commitment similar to the railways. Despite an extraordinary crop size that was not forecasted by anyone and periods of extreme winter weather, our railway has continued to move record amounts of grain and despite this unfortunate order in council, Canadian Pacific is committed to matching the record volumes we moved in the fall, which will align with the order.  CP expects to transport 240,000 carloads of Canadian grain this crop year, a more than 20 per cent increase over last year’s record.”