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Canola Growers Concerned About Rail Costs

“We didn’t want to antagonize the minister, but we wanted to make sure that he knew we are concerned.”

– ROB PETTINGER, MCGA

Canola growers care about rail freight costs and want the federal government to review them, says Rob Pettinger, president of the Manitoba Canola Growers Association (MCGA).

Pettinger was reacting to comments from Agriculture Minister Gerry Ritz, who was quoted in the House of Commons recently as saying he hadn’t heard complaints from canola or pulse growers about the cost of transporting those crops.

“We are hearing concerns from wheat board growers because they cannot value add,” Ritz said. “They are forced to do buybacks, which costs them far more than this supposed increase in freight.”

The MCGA said in a news release last week the minister’s comments suggest canola producers are not concerned about rail costs.

“Nothing could be further from the truth,” Pettinger said. “While the canola industry in Canada has a larger amount of domestic value-added processing than other crop commodities, many canola producers deliver their canola to export position by rail and directly bear that cost.

“Given Manitoba’s proximity to the Port of Vancouver, the cost of rail freight will always be an important issue for Manitoba canola producers.”

Last month a report prepared by Travacon Research and commissioned by the Canadian Wheat Board concluded crop farmers are paying $200 million a year, or $6.87 a tonne, too much on freight costs.

The CWB, backed by Keystone Agricultural Producers, the Agricultural Producers Association of Saskatchewan, Canadian Federation of Agriculture, National Farmers Union and Wild Rose Agricultural Producers, is asking the federal government to review what it costs the railways to move crops from Western Canada to export position.

If a review corroborates Travacon’s figures the next step would be to adjust the formula to reduce the maximum revenue the railways are allowed to collect for shipping grain.

“We didn’t want to antagonize the minister, but we wanted to make sure that he knew we are concerned” about freight costs, Pettinger said in an interview. “I think we would’ve caught some flak from our members if we hadn’t.”

Although a lot of canola is processed domestically, the export price, including freight costs, affects that price farmers receive for all canola sold in Western Canada, Pettinger said.

The MCGA has not formerly notified Ritz of its concerns about rail costs or its support for a costing review, but it will, probably through the Canadian Canola Growers Association, Pettinger said.

The Alberta Canola Producers Commission, meanwhile, has already written to Ritz on the matter, citing his quotes from the Commons.

“Please be assured that the cost of moving canola is of significant concern for the 15,000 canola producers in Alberta,” ACPC chairman Kevin Bender wrote to Ritz on July 8.

Freight costs will “always” be an important issue for Alberta canola growers, Bender wrote, “perhaps more so” than for growers farther east on the Prairies.

That’s because Manitoba and Saskatchewan growers, he wrote, are closer to canolacrushing plants than they are to West Coast ports.

[email protected]with files by Co-operator staff

About the author

Reporter

Allan Dawson

Allan Dawson is a reporter with the Manitoba Co-operator based near Miami, Man. Covering agriculture since 1980, Dawson has spent most of his career with the Co-operator except for several years with Farmers’ Independent Weekly and before that a Morden-Winkler area radio station.

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