Newsroom
2007
CWB enters major rail dispute seeking flexibility, cost control for farmers
April 2, 2007
Winnipeg – The CWB has filed an application to intervene in a major case launched against CN Rail over the transportation of grain from Western Canada.
“Our issues centre on flexibility, efficiency and cost-control in the movement of Prairie farmers’ grain to Canadian ports,” said CWB president and CEO Greg Arason. “CN’s actions this crop year fail to recognize the diverse requirements of its highest-volume customers: the grain producers of Western Canada.”
The intervention states that rail-car booking restrictions introduced by CN impair the CWB’s ability to market grain in an orderly fashion at a reasonable cost. “CN’s programs are causing serious issues for the transportation of grain, issues that are systemic,” it reads. “The CWB submits that CN is not meeting its level of service obligations under The Canadian Transportation Act.”
The level-of-service complaint was filed with the Canadian Transportation Agency (CTA) on March 8 by Great Northern Grain (GNG), a grain terminal in Nampa, Alberta. The CWB on March 27 filed its application.
The case targets changes CN has made to the way grain cars are allocated under advance bookings. The changes not only jeopardize orderly and efficient grain transportation, they could put Western Canada’s smaller and single-point grain shippers out of business. Nine other grain-industry organizations, including several producer-owned grain terminals, are also seeking intervener status in the case.
Arason said the CWB intends to ensure GNG is successful in halting a trend that benefits CN Rail at the expense of farmers and grain shippers.
“The CWB successfully challenged the railways in a major case in 1997 and we intend to do it again now with CN Rail,” he said. “We believe GNG’s case has ramifications for farmers and the entire industry.”
Grain marketing from Western Canada is dependent on rail transportation as the only feasible way to move grain to ports and markets. There is heavy competition for rail cars during the peak shipping period of October to March. Farmers’ wheat and barley marketed by the CWB makes up 60 to 70 per cent of the volume in the Canadian grain handling system.
This crop year, CN decided to restrict its advance bookings of rail cars at tariff freight rates to 100-car units, discriminating against smaller and single-point shippers. Only 22 per cent of primary elevators have a car spot capable of loading 100-cars at a time.
“If grain companies cannot stay economically viable, it is farmers who lose,” Arason said. “They lose delivery opportunities and they lose choice among country elevators. Producers also lose because it is they who ultimately pay the increased costs of shipping grain to port.”
A determination is expected from the CTA before July 6, 2007. Submissions pertaining to the case must be received by April 8.
Controlled by western Canadian farmers, the CWB is the largest wheat and barley marketer in the world. One of Canada’s biggest exporters, the Winnipeg-based organization sells grain to over 70 countries and returns all sales revenue, less marketing costs, to farmers.
For more information, please contact:
Maureen Fitzhenry
CWB media relations manager
Tel: (204) 983-3101
Cell: (204) 479-2451