Farmers in many parts of western Canada have had trouble delivering grain this winter due to extremely poor service by Canadian Pacific Railway.

"It's the worst service that we've seen in our collective memory," says Wade Sobkowich, Executive Director of the Western Grain Elevator Association.

He says since August 1st, 2010, CP has spotted less than 65 percent of car orders, and less than 30 percent of car orders have arrived on time.

"Farmers are having less delivery opportunities. Country elevators haven't been able to ship the grain in a timely way. It's creating a backlog through the system," he says. In the bigger picture, it means companies have to pay vessel demurrage and contract extension penalties if grain doesn't get to its destination on time. "

Railways currently face no penalty when they fail to provide adequate service.

"When a grain elevator doesn't load or unload the railcars within a specified time period they get penalized, but there is no reciprocal penalty placed on the railway when they fail to spot the cars in a timely way, or fail to provide enough equipment to meet demand, or fail to deliver those cars," he says. The WGEA, along with other shippers, are pushing for a legislated disincentive to prevent poor performance by the railways.

Meanwhile, Sobkowich says Canadian National Railway has improved its grain shipping service.

"Today, CN is performing much better, but I believe they also have a shortfall of cars," he says. "But it ebbs and flows depending on the time and the year. Sometimes CP is performing better. Sometimes CN is performing better. Two years ago I would have said CP is performing much better than CN. It just goes to punctuate the need for legislative re-balancing so it can apply to the system no matter who is not performing well."

The federal Rail Freight Service Review Panel's Final Report is expected to be released within the next few weeks.

"We were hoping it would be released in January, and then February, and now we're into March, so we know the release of the report is imminent," says Sobkowich. "We're hoping the government chooses to make some significant legislative change."

~ Thursday, March 3, 2011 ~