Ritz sending mixed rail signals

Nov 2014
The StarPhoenix
Ritz sending mixed signals
There seems to be some confusion — again — regarding the minimum volumes of grain required to be moved by railways under the Fair Rail for Grain Farmers Act and Canada Transportation Act (CTA) regulations.
A Reuters news story out of Winnipeg last week quoted Agriculture Minister Gerry Ritz as saying that the minimum volume requirements will be lifted, barring an unforeseen increase in grain piling up in Western Canada.
The story, which appeared Oct. 28, quoted Ritz as saying the government would have to see a “complete failure by the railways to move grain” to extend the minimums beyond the Nov. 29 expiry date.
But Ritz has since backed away from that statement, adding that no decision has been made to change the legislated requirement for minimum tonnages of grain to be shipped by Canadian railways.
“Minister Ritz has stated that no decision has been made with respect to volume requirements. The ministers of Transport and Agriculture will receive advice from the CTA and will make a decision in due course,” said a statement issued by Ritz’s office Tuesday.
The changes were brought in earlier this year to clear up the backlog of grain from last year’s record harvest that cost western farmers $7 billion to $8 billion in lost sales, according to federal government figures.
On March 7, the government ordered Canada’s two major railways to move one million tonnes of grain per week or face fines of $100,000 per day, effective April 1. Those fines were later reduced to $100,000 per week when the order was extended in August.
In the Reuters story, Ritz was quoted as saying that grain was moving more smoothly through the system this year compared to last year, largely due to the much smaller size of this year’s crop. Last year, western farmers harvested a record 76 million tonnes of grains and oilseeds, while this year’s crop is expected to be closer to normal at about 57 million tonnes.
Deputy Liberal Leader Ralph Goodale agreed “the volume situation is a bit better than last year because most of the backlog has now moved and this year’s volume was more or less normal.”
But Goodale added “this year’s crop is also far more complicated by variable quality issues, so logistics will still be very challenging.”
That’s why a “one-size-fits-regulatory solution,” like the order-in-council to increase shipments to one million tonnes per week, is less likely to work this year, the former agriculture minister said.
“The order would need to be re-jigged to reflect sensitivity toward quality variability, corridors west, east, south and north, the needs of shortline operators and producer car shippers, and Canadian domestic consumers and processors, among others,” Goodale added.
The Regina MP said the Harper government continues to miss the fact that “shippers are captives with no competitive commercial alternatives and no legal recourse, and (without the Canadian Wheat Board) there is no overall way to achieve system-wide co-ordination.”
“And the government has no plan.”

About prosperitysaskatchewan

Consultant on Saskatchewan's natural resources.

Posted on November 5, 2014, in miscellaneous. Bookmark the permalink. Leave a comment.

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