MP Earl Dreeshen Welcomes Legislation to Address Rail Capacity Challenges

March 26, 2014

OTTAWA – Earl Dreeshen, Member of Parliament for Red Deer, is welcoming today’s introduction of the Fair Rail for Grain Farmers Act, aimed at strong action to respond to the challenges currently facing Western Canada’s rail shipping system. This legislation amends the Canada Transportation Act and the Canada Grain Act, providing additional measures designed to help the entire grain transportation system reach the goal of getting product to market quickly and more efficiently following a record crop year for Canadian farmers.

“Immediate, concrete action is needed in order to get grain moving faster – that is what this legislation is all about,” said Dreeshen. “I have had conversations with hundreds of farmers in Central Alberta and I believe this legislation will give them the tools they need to get their product to market.”

There are three major components of the legislation including:

  • Increasing supply chain transparency;
  • Strengthening contracts between producers and shippers; and,
  • Helping to ensure the entire grain handling and transportation system is working efficiently at the top of its capacity.

The Government of Canada is also taking steps to address the medium and long-term implications of higher crop yields and extreme cold weather. Going forward, railways will be required to deliver more timely data on grain movements to better monitor the overall performance of the supply chain. The Canadian Transportation Agency will also gather information from all grain supply chain partners on shipping capacities and plans prior to each new crop year, and will advise the Minister of Transport whether specific grain volumes should be mandated for the coming year.

Furthermore, the Government will accelerate the review of the Canada Transportation Act with a view to further improving Canada’s grain handling system over the long term in order to achieve improved capacity, predictability, planning and accountability for all parties in the supply chain.

Dreeshen was in Winnipeg on March 7, 2014 as Agriculture Minister Gerry Ritz and Transport Minister Lisa Raitt announced an Order in Council that obligates Canadian National (CN) and Canadian Pacific (CP) to increase their capacity to each carry a minimum of 500,000 metric tonnes of grain per week, by the week of April 7, and for them to report on the volume of grain moved each week.

The order imposes these obligations from March 10 to June 7, 2014. It creates a legal obligation on railways, and penalties of up to $100,000 per day could be imposed on them for failing to comply. The proposed legislation extends these performance requirements to August 3, 2014.

This year’s Western Canadian crop, at 76 million tonnes, is 50% higher than average. This volume is putting significant pressure on Western Canada’s grain handling and transportation system. As the Government continues to work with farmers to invest in research and innovation, higher yields will continue to be the new reality across Canada.