Newsroom
2000
April 28, 2000
CWB Board of Directors condemn rate increase
Winnipeg -- The Board of Directors of the CWBcondemned the increase
in the maximum rate scale for grain movement recently announced by
the Canadian Transportation Agency (CTA).
Chairman Ken Ritter said, "It is unbelievable that farmers should
be expected to pay another $1.45 per tonne to the railways when it
has been shown that they have been over-paying for nearly a
decade."
While the rate increase is a consequence of the price indexing
formula prescribed in the Canada Transportation Act, the CTA's own
review of railway costs last fall documented that this calculation
results in excessively high freight rates because it ignores
productivity gains from which the railways have benefited since
1992.
"We have seen the results of the CTA's costing review for 1998 and
it confirms that farmers are entitled to significantly reduced rail
rates," Ritter said. "For an average-sized farm that entitlement is
more than $5,000."
"Both railways have recently announced record or near record profit
levels in the midst of a farm income crisis. Excessive freight
rates are the direct result of a lack of competition in the rail
industry. We are calling for the federal government to rectify this
unacceptable and untenable situation."
Ritter also urged the federal government to make a decision for
grain transportation reform based on the recommendations supported
by the major farm organizations, Keystone Agricultural Producers,
Saskatchewan Association of Rural Municipalities, and Wild Rose
Agricultural Producers. With the implementation of these
recommendations, the CWB is prepared to move forward with a package
of tenders and commercial contracts that will enhance competition
and improve system performance in meeting the needs of grain
producers and their customers around the world.
The CWB is the world's largest farmer-controlled wheat and barley
marketer. Headquartered in Winnipeg, Manitoba, it is one of
Canada's biggest exporters and the largest net earner of foreign
exchange. Marketing Prairie-grown wheat and barley to over 70
countries around the world, the CWB returns all sales revenues,
less the costs of marketing, to farmers in Western Canada.