Producers, Grain Companies Welcome Plan to Extend Rail Rules for Moving Grain

Producer and grain industry groups are applauding the federal government’s plan to extend measures meant to keep grain moving to market by rail.

Several provisions implemented during the grain backlog in 2014 as part of Bill C-30, the Fair Rail for Grain Farmers Act, are scheduled to be repealed on August 1, 2016. On Friday, Ag Minister Lawrence MacAulay and Transportation Minister Marc Garneau announced they intend to extend the measures by another year.

“The content of these provisions, such as interswitching and level of service obligations, impacts all shippers and postponing the repeal of these provisions would allow the government to fully assess the freight rail transportation system for all commodities, in the context of its response to the review of the Canada Transportation Act and the development of a long term plan for the sector,” said Garneau, who is currently considering the results from the CTA Review Report published in February. The “Emerson Report” included several recommendations for improving movement of grain by rail.

The extension would maintain longer interswitching limits at 160km rather than the historical 30km, which grain industry groups say has fostered rail competition and flexibility for shippers.

“Many of the grain companies are using the extended interswitching provisions right now and it introduces some options, some measure of competition between railways, and so we welcome the government’s announcement,” says Wade Sobkowich of the Western Grain Elevator Association, representing major grain companies on the prairies, in the interview below.

Although there are currently no mandatory minimum weekly shipping requirements for railways, the extension would also apply to the government’s right to set volume thresholds for both national railways. There’s also a provision that allows for operational terms to be included in level of service agreements between shippers and railways, notes Sobkowich.


Listen to Wade Sobkowich of the Western Grain Elevator Association discuss the extended rail provisions, the Emerson Report recommendations and the politics involved.

“The provisions in the Fair Rail for Farmers Act were brought into place on an urgent basis during the transportation crisis of the 2013/14 crop year. It is appropriate that these measures remain in place until we have a permanent solution to the conditions that led to that crisis,” explained Cam Dahl, president of Cereals Canada in a statement on Monday.

Commodity groups in Alberta also applauded the plan to extend the rail provisions.

“This welcomed news from the Federal Government demonstrates that Transportation Minister Garneau and Agriculture Minister MacAulay have listened to the concerns of western Canada’s grain producers and understand the importance of a reliable and predictable transportation system to move our commodities into the marketplace,” said Kevin Auch, Alberta Wheat Commission chair.

“While the Minister of Transport considers the recommendations presented in the CTA review report, we will continue to advocate for measures that promote long-term railway accountability and adequate rail service,” added Alberta Barley chair Mike Ammeter.

Long-term transportation solutions and the extension of the interim provisions in Bill C-30 were both priorities as “Team Alberta” — representatives from Alberta Wheat Commission, Alberta Barley, Alberta Canola Producers and Alberta Pulse Growers — met with policymakers in Ottawa last week.

Both the House of Commons and the Senate will have to adopt a resolution in support of postponing the repeal of the rail provisions. The House of Commons is scheduled to break on June 23.

Related: Transportation Act Recommendations Seen as a Mix of Positives, Red Flags and Vague Wording

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