Farmers call for fines on railways as grain backlog grows

Prairie farm groups are calling on Ottawa to introduce some kind of penalty for rail companies for failing to meet deadlines in shipping grain to market.

This year’s record grain harvest has clogged the rail system in western Canada and many farmers are missing their deadlines to get grain to the ports.

At least one big grain company has built temporary storage covered with tarps to protect huge piles of grain at their elevators from the elements.

We have demand into Mexico [and] we can't get rail cars. We have demand in the U.S., we can't get rail cars. We've got demand east, we can't get sufficient rail cars.- Keith Bruch, Paterson Global Foods

Doug Chorney of Keystone Agricultural Producers said CN and CP Rail have not put enough trains and grain cars in service to haul crops to ports for export.

Keith Bruch, vice-president of operations at Paterson Global Foods, said he can’t get the rail cars he needs.

“We have demand into Mexico [and] we can't get rail cars. We have demand in the U.S., we can't get rail cars. We've got demand east, we can't get sufficient rail cars. So it's forcing us to scale back a sales program," he told CBC News.

Grain companies fined for delays

Meanwhile grain companies are being fined for any delays, Bruch said.

“Right now, there's about 25 vessels waiting in Vancouver for product. We have contracts with farmers, we have contracts with end-use customers, we've got contracts with vessel owners. We're contractually obligated everywhere except with railway,” he said.

Norm Hall, president of the Agricultural Producers Association of Saskatchewan, said the Fair Rail Freight Service Act,  created by Ottawa last June to deal with this kind of situation, is just not effective.

Farm groups say the legislation needs to be amended to make it easier to hit railway companies with fines over transportation bottlenecks. The act does include a provision for penalties, but only if an arbitrator decides a signed service agreement has been violated.

CP Rail says it's moving more grain this season than it ever has before, but the crop is so large, it can’t make deadlines.

CN Rail spokesperson Jim Feeny says adding more rail cars to the system might actually make the problem worse.

“Think of a freeway at rush hour. If you throw too many cars onto the road, the road plugs and everything backs up and slows down. If you throw more rail cars into the system, you going to get exactly the same result,” Feeny said.

Could CWB have handled this crop?

Statistics Canada released figures about rail traffic on Wednesday, showing a large rise in shipments of coal, iron ore and oil in September, compared to this time last year.

There have been suggestions this kind of logjam would not have happened under a single-marketing desk like the one the Canadian Wheat Board used to operate.

The CWB used to spread out shipments throughout the year, so there was less demand for rail cars all at once as grain companies compete to get the best prices for their share of the crop.

However, agricultural experts say even the CWB would have had challenges managing this kind of bumper crop.