Mr. Speaker, during the last six months the grain handling and transportation system in the west has been in crisis. Tonight I want to take part of my time to discuss the recommendations made by the subcommittee on grain transportation which has reported to the Standing Committee on Agriculture and Agri-food. I also wish to address some of the long term solutions offered by the Reform Party for grain transportation in the west.
The subcommittee on grain transportation has been examining the current problems over the last few weeks and even held public hearings with the major participants in the grain handling and transportation sector.
The subcommittee reported to the Minister of Agriculture and Agri-Food and the Minister of Transport on Friday, May 6. In the report the members of the subcommittee describe the current situation as a crisis. They estimated that in this crop year alone the grain car shortage in the west would cost producers at least $35 million in demurrage charges for ships waiting at the west coast ports. They also estimated that two million tonnes of grain sales would be lost or at least deferred which could cost producers between $100 million and $200 million.
The report prepared for the subcommittee on the St. Lawrence seaway by the Library of Parliament also felt that there was an even far more serious long term consequence if this transportation crisis is not solved on an urgent basis. It was felt Canada's reputation as a reliable supplier of grain to the world would be jeopardized.
The report said: "If Canada cannot meet its delivery commitments on time sales will be deferred, cancelled, and customers will go elsewhere".
The subcommittee determined that the current grain transportation crisis was caused by a number of circumstances including, first, a sharp increase in the movements of grain to the U.S.A. resulting in a doubling of turnaround times for rail cars from 20 days to 40 days; second, a tight lease market in the U.S.A. for grain cars because of the flooding of the Mississippi needed to replace barges; third, an increase in the movement of non-board speciality grains which are handling intensive, resulting in longer car cycles; fourth, a very severe winter which slowed rail traffic; and, fifth, a 13-day strike at the west coast by grain handlers.
The Reform Party supports the recommendations made by the subcommittee on grain transportation and the subcommittee on the St. Lawrence seaway. If I had the time, I would like to outline all nine of the recommendations made to the Minister of Agriculture and Agri-Food and to the Minister of Transport in response to this crisis. However I think at this point in the debate everyone in the House is fairly clear on the content of these recommendations.
In addition to the subcommittee's report to the ministers, Reformers have two other recommendations which we believe will help address the crisis. First, farmers should be allowed greater choices as to how their grain is shipped to market. In times of backlogs and strikes alternative ports including U.S. ports should be used to export Canadian grain.
The second recommendation we would like to put forth is that there is an excessive amount of overregulation and the rail transportation system is unable to respond effectively to market demands. The rail car allocation system needs to be less centralized and less regulated.
Personally I would like the ministers responsible to seriously consider the port of Churchill. It could be used to help alleviate the immediate crisis. I would like to also encourage the minister to develop a long term strategy for grain transportation using all ports: Vancouver, Thunder Bay, Churchill and the U.S.A.
On the longer term the Reform Party believes that permanent reforms are necessary to ensure that politics are removed from the transportation of grain. I emphasize the Reform Party believes that agricultural commodities should move to markets by any expeditious mode, by any route, and in any form or state of processing. Such decisions should be based exclusively on the principle of cost effectiveness and with the best interest of the customer in mind.
To this end the Reform Party makes the following recommendations. First, the Western Grain Transportation Act should be repealed and all transportations subsidies should be redirected to the Reform Party's proposed comprehensive safety nets
programs which will defend Canada's food producers against matters over which they have little or no control.
Second, in order to create a genuinely competitive transportation environment the Reform Party recommends the deregulation of the rail transportation system, turning control of the allocation of rail cars back to railways and the grain companies and eventually privatization of all rail cars. This would mean the end of the grain transportation agency and the senior grain transportation committee.
There are about 21,000 grain hopper cars in the system today and 18,500 are owned by the government. Reformers see no reason for the grain companies and the railways not to own their own rail cars. The free market should determine how many rail cars are needed and when and where they are needed in the system. The turnaround time for a rail car in the grain transportation system is between 20 and 25 days, and this turnaround time has not improved since 1908. By comparison, the potash industry in my riding has a turnaround time of between 7 and 8 days to the same ports. The potash industry leases its own rail cars and the grain industry should do the same.
As our final recommendation, during periods of labour disputes the Reform Party recommends the alternate use of shipping points, including U.S. ports. Should that not prove sufficient in maintaining shipment levels and customer satisfaction then they should legislate the grain handlers as an essential service.
A final point is in regard to the strategic use of the port of Churchill. The Hudson Bay Route Association has its office in Yorkton, Saskatchewan. For years this association has been effectively promoting the use of the port of Churchill as an alternate port for grain shipments. If the shipment of agricultural products is based exclusively on the principle of cost effectiveness and with the best interests of the customer in mind as the Reform Party proposes, the port of Churchill will be successful in attracting its fair share of the transportation market.
For example, and this is important, if CN will provide the boxcars this summer to an agricultural commodity broker he will move at least one and possibly two shiploads, that is 80,000 tonnes of pulse crops, through the port of Churchill to Europe at a saving of 60 cents per bushel. The Hudson Bay Route Association also maintains that if elevators are plugged and the grain bins are full then the boxcars designed for the Churchill run should be moving grain to Churchill and customers could be advised of the availability of grain at that port.
The Hudson Bay Route Association has also learned that the Canadian International Development Agency, CIDA, gives away 750,000 tonnes of grain handling. It asks, if we are going to give that grain away, why we cannot direct those ships to pick up their grain at Churchill. It is a question that deserves an answer.
Even the Minister of Human Resources Development publicly supports greater utilization of the port of Churchill. The ministers of agriculture in both Saskatchewan and Manitoba publicly support greater use of the port of Churchill. The federal and provincial politicians agree that now is the time to actively promote the port of Churchill to grain customers throughout the world.
In closing I would like to point out that I was raised on a farm. I farmed myself for seven years just outside Yorkton. Farming is part of me. Farming is in my blood. Farming is my culture and my heritage. Farming is very special to me, so special that I do not want the government running it. The government is too involved in trying to solve the farmers' problems when farmers are quite capable of solving their own problems; if only the government would get out of the way.
I encourage members of the House to support the subcommittee's recommendations to help get the grain moving in the west. I also ask for support of the Reform Party's longer term solutions to our grain transportation system.