|
Great Northern
Grain Terminal Ltd. News Release MAJOR
CASE FILED AGAINST CN RAIL OVER GRAIN SERVICE Ottawa, Ontario – Great Northern Grain (GNG), an inland grain terminal in Nampa, Alberta, today filed a major level-of-service complaint against the Canadian National Railway (CN). The action, filed with the Canadian Transportation Agency, is supported by 10 grain industry corporations, which are seeking intervener status in the case. They are: the Canadian Wheat Board, Great Sandhills Terminal, Northeast Terminal, Northwest Terminal, Parrish & Heimbecker, Paterson Grain, Prairie West Terminal, Providence Grain Group, Southwest Terminal and Weyburn Inland Terminal. At issue is a recent change made to CN’s advance-product program that is preventing smaller grain companies and single-point shippers from securing enough rail capacity to stay viable. It is also a serious concern for farmers who face added costs, marketing challenges and delivery disadvantages from reduced flexibility in rail transportation for their grain. “This change by CN could put our business in jeopardy,” said Bruce Horner, CEO of GNG, of his 17 000-tonne capacity GNG grain terminal in Nampa. “If this continues, only very large players will be left to ship and handle grain in the West. We believe CN is failing to meet its obligation of service to small shippers and farmers.” Rob Davies, CEO of Weyburn Inland Terminal (WIT), said it was important for others in the Prairie grain industry to support this case. “We as a group of shippers, handlers and marketers of western Canadian grain stand solidly behind Great Northern Grain in its pursuit of fairness from CN. Our company has joined in this action, not because we face the same issues with Canadian Pacific Railway on our own line, but because we hope we never will.” For the 2006-07 crop year, CN eliminated opportunities to advance-book guaranteed supplies of rail cars in units of 50 (except for a limited supply of cars available through cash bids). The railway now offers only blocks of 100 cars, which must essentially be booked to one destination for 42 consecutive weeks to secure supply. This is impossible for singlepoint shippers and smaller companies. Only 22 per cent of primary grain elevators in Western Canada have a rail car spot for 100 cars or more. With only enough track for 73 cars, GNG is incapable of participating in CN's 100-car advance program, which moves at railway tariff rates, and is forced to pay cash bids to CN at over-tariff rates to secure any advance products. Advance cars this year have comprised almost 70 per cent of CN’s total railcar offerings to the Port of Vancouver. The remainder is allocated as general car supply with no guarantees provided. For farmers, the change CN has made creates additional obstacles to the efficient movement of their grain to port. This costs them money and risks sales opportunities with international buyers. More than 20 million tonnes of western Canadian grain are exported each year. “We must have flexibility in grain transportation,” said CWB Chief Operating Officer Ward Weisensel. “On farmers’ behalf, the CWB markets and coordinates movement of grain in many different grades, classes and protein levels, sourced from diverse locations all across the Prairies. The change CN has made to advance cars reduces efficiency in the system.” CN is one of two Class One railways, which are critical to the movement of grain. Grain is one of Canada’s largest-volume exports, worth billions of dollars a year to farmers, the grain industry and the economy. Delays and inefficiencies in railway performance can lead to significant extra costs for shippers. The CTA will now investigate the complaint and render a determination within 120 days. - 30 - |