April 1, 2015
To: Agricultural Producers Association of Saskatchewan
Saskatchewan Barley Development Commission
Saskatchewan Pulse Growers
Saskatchewan Wheat Development Commission
Re: Rail costing review and Maximum Revenue Entitlement adjustment
The National Farmers Union would like to endorse the report, Estimated Contributions Earned by Railways from Handling of Statutory Grains and Grain Products 2013/14, by John Edsforth of Travacon Research Limited, commissioned by your organizations.
The last full rail costing review was done in 1992. According to Quorum Corporation, there were 685 grain delivery points with 976 country elevators in Western Canada in 1999. Today, there are only 272 grain delivery points and 342 country elevators. With fewer points of service, allowing CN and CP to run longer trains and make fewer stops, the railways’ costs have come down — yet they have not passed on their efficiency gains to farmers by reducing freight rates. Farmers are paying more than their fair share of grain transportation costs, not only through excessive freight rates, but the reduction in railway delivery points means that farmers must drive farther to deliver grain to country elevators, incurring increased costs for fuel, truck purchase and maintenance, and time spent on the road.
Therefore, the National Farmers Union would like to join with your organizations in calling for a full rail costing review and adjustment of the Maximum Revenue Entitlement according to its results.
President, National Farmers Union
cc: Hon. Lisa Raitt, Minister of Transport
Hon. Gerry Ritz, Minister of Agriculture and Agri-Food
Hoang Mai, Official Opposition Critic for Transport
Malcolm Allen, Official Opposition Critic for Agriculture
David McGuinty, Liberal Party Critic for Transport
Hon. Mark Eyking, Liberal Party Critic for Agriculture
Elizabeth May, Green Party of Canada
Honourable Verlyn Olson, Minister of Agriculture and Rural Development (Alberta)
Honourable Lyle Stewart, Minister of Agriculture (Saskatchewan)
Ron Kostyshyn, Minister of Agriculture, Food and Rural Development (Manitoba)