While the Canada Grain Act provides farmers with the right to order their own railcars, in reality there have been major challenges for many farmers and their administrators in securing access to producer cars for shipping grain over the last few years.
One of the factors contributing to the producer car problem has been an unintended consequence of the federal government’s minimum weekly shipping mandates for the railways, as they’ve led CN and CP Rail to favour larger trains in easy to access places. Combine this bias against producer cars with a spike in demand during the 2013-14 crop year, and the results have included a car waiting list in the tens of thousands, producer cars only being delivered months after they were supposed to arrive, and farmers missing out on opportunities to market their wheat and other crops.
In this Wheat School episode, Jim Smolik and Murdoch MacKay, assistant chief commissioner and commissioner, respectively, with the Canadian Grain Commission sit down to explain how the CGC looks after the processing and allocation of orders for producer cars (you can order a car online here.)
While responsible for submitting car orders to the railways, the CGC cannot force railways to deliver cars that have been ordered, notes Smolik.
“The grain commission has no authority over forcing railways (to spot cars.) That’s in the Minister of Transport’s portfolio. We play a part in ensuring cars are available to producers, but as far as enforcing it, we have no authority in that regard,” he explains.
The commission is meeting with railway officials to discuss how to increase transparency and predictability in the producer car ordering system, says MacKay:
“There are a lot of producers wondering ‘when?’ and if we can get better communication going and take the question and unknown out of it, that’s what we’re trying to do, and those are some of the discussions we’re trying to have with the railways.”
As part of this Wheat School video they also explain how the railways’ move to cap railcar orders last fall has impacted producer cars and whether they foresee any legislative changes to the producer car system down the road (or track):