CN and CP Rail made too much money last year shipping grain, according to the federal government – but the president of the Agricultural Producers’ Association of Saskatchewan (APAS) is more concerned about how much grain those companies shipped.
According to an accounting released on Monday, the two companies exceeded their maximum grain revenue entitlement for the 2017/18 shipping season, and at the same time they shipped six per cent less grain in that year than the year before.
The Canadian Transportation Agency said CN rail exceeded its grain revenue entitlement by $1,047,285, and CP went over by $1,500, 513.
The two companies will have to pay those amounts to the Western Grain Research Foundation, plus penalties of $52,364 for CN Rail, and $75,026 for CP Rail.
Together, the two companies also shipped six per cent less grain in 2017/18 than they did the year before.
Todd Lewis, president of APAS, calls that poor service.
“So, in fact, you know, farmers have paid the maximum amount they could possibly be charged, for poor service,” said Lewis.
Lewis said last year the rail companies tried to blame the poor service on cold weather, “in fact it was … due mainly to lack of manpower and locomotives.”
This year, the companies have invested in new rail cars, explained Lewis. Though, he said they’re not on the tracks yet.
So far this year, Lewis said farmers have seen satisfactory service from the rail companies.
“We need to see good service and we’re sure hoping the railroads pick up and do a better job this year than they did last year.”
Especially as this year could end up being a challenge with pipeline problems pushing oil to the rails as well.
“So the railroads have to pick their game up for all western Canada here because we need our commodities moved,” said Lewis.
CN and CP Rail have both exceeded their maximum grain revenue entitlement for the last few years, though in the two years previous the overages were significantly more than they were in 2017/18.
The maximum grain entitlement is a cap set by the federal government on how much the two rail companies can make in a year from shipping prairie grain to specific export positions. It’s meant to help provide some protection from the price of shipping for farmers.