Tuesday, March 1, 2011

Canadian Grain Exporters Slam CP Railway for Poor Service

The Western Grain Elevator Association on Monday slammed the publicly-owned Canadian Pacific Railway for not providing enough grain rail cars and offering "extremely poor service."

WGEA members handle more than 90 percent of Canada's bulk grain exports, a large percentage of which travels thorough the Canadian West Coast ports of Vancouver and Prince Rupert.

"We expected the upcoming release of the [Canadian federal government's] Rail Service Report to result in improved service by the railways in an attempt to counter the serious performance concerns uncovered by the Review Panel. However, this is not the case." WGEA executive director Wade Sobkowich said.

According to WGEA, since August 1, 2010, only 65 per cent of car orders have been accepted by CPR and the Canadian Class I railroad has only provided 30 per cent of the accepted cars on time. Sobkowich said this performance is the worst in the collective memory of the WGEA.

The WGEA is asking the Canadian Rail Service Review Panel to legislatively "create disciplines" to ensure "adequate service levels are established and sustained" by the railroad.

The legislative amendments sought by the WGEA would set a base expectation for rail service and meaningful penalties to be paid to shippers where those levels of service were not met.

"The only sustainable solution lies in creating a legislated disincentive for poor performance that is significant enough to ensure it doesn't happen in the first place, similar in nature to the various penalties that the railways impose on shippers to manage efficient behavior," Sobkowich said.

"If the railways are genuine in their intent to provide adequate service, then the legislative provisions we are proposing will never be used. They would only come into effect if the railway fails to perform."

CPR told the Winnipeg Free Press that "unusual circumstances," such as an inaccurately small forecast of grain production with a simultaneous spike in the demand for grain, led to the railroad's problems in delivering grain cars last fall and this winter.