With grain company interest waning following the end of the Canadian Wheat Board’s single desk in 2012, it appears the Port of Churchill will not be handling any grain during the upcoming shipping season.
The port, which is owned by Denver-based OmniTrax, called its employees to a meeting at 3:30pm on Monday to inform them they were being laid off.
“Our members were blind-sided. There was no discussion, no warning, nothing,” said Teresa Eschuk, spokesperson for the Union of Canadian Transportation Employees (UCTE), which is part of the Public Service Alliance of Canada (PSAC) and represents the port’s workers.
The port was the largest employer in Churchill, employing approximately 10 percent of the town during shipping season.
Keystone Agricultural Producers — Manitoba’s general farm group — is asking the federal government to step in to keep the port open for the 2016 season.
“This is a major blow to us, especially when there appears to be an exceptionally large crop coming,” said Dan Mazier, KAP president and Justice, Man.-area farmer, in a statement on Tuesday. “The last time we had a large crop, grain movement through the port was up 50 per cent over the previous year.”
OmniTrax has been trying to sell the port since last year. A group of Northern Manitoba First Nations signed a letter of intent last December saying they planned to purchase the port, but no deal has been reached.
Mazier said he was surprised to hear the news, as OmniTrax had indicated the upcoming shipping season was looking good.
“And now the company is saying there isn’t enough grain coming in – something doesn’t add up,” said Maizer.
The Port of Churchill just laid everyone (myself included) off, and told us there will be no grain season this year.
— ? ???? Joe Stover (@joechurchill) July 25, 2016
The Canadian Wheat Board historically accounted for over 90 percent of the volume moved through the port. Coinciding with the end of the CWB’s single desk in 2012, the federal Conservative government implemented a per-tonne incentive, providing up to $5 million per year in subsidies to grain companies for shipping through Churchill. That program will expire in 2017.
Grain volumes through the port were down last year, with only 187,800 tonnes of wheat, durum and lentils loaded at Churchill — well below the port’s typical seasonal volume of more than 400,000 tonnes.
While its proximity to crops in northeastern Saskatchewan and northwest Manitoba is potentially an advantage, insurance costs of bringing ships into Hudson Bay, the short and unpredictable ice-free shipping window, and rail delays caused by shifting permafrost beneath OmniTrax’s 627 miles of track to Churchill are viewed by grain companies as disadvantages. Most of these companies also own port assets in Vancouver or Thunder Bay.
KAP is also asking Ottawa to come up with a plan that will ensure the port opens for the 2017 season.
“We don’t want to lose this facility permanently, and the longer it stays shut, the more possible that scenario becomes,” noted Maizer.
Merv Tweed, president of OmniTrax Canada and former Conservative member of parliament, has been unavailable to comment. Ron Margulis, OmniTrax spokersperson in Denver, said the company might release more information this week.