Evidence of meeting #22 for Agriculture and Agri-Food in the 41st Parliament, 2nd session. (The original version is on Parliament’s site, as are the minutes.) The winning word was need.
A recording is available from Parliament.
Conservative
Bob Zimmer Conservative Prince George—Peace River, BC
Mr. Mongeau said that 11,000 would likely be the capacity of our ports. I just wanted to check to see if he was accurate in that number, if that was the maximum capacity.
Executive Director, Inland Terminal Association of Canada
Well, he had better not be. If that's the maximum capacity, we're in serious trouble, especially if we're looking at all the ports and Thunder Bay opening soon, and we should be getting southern movement going as well.
I think there is more capacity than that. We heard from grain handlers and the grain handlers union at Richard's conference earlier in the week. He seemed to indicate that there was considerably more capacity that could be utilized with longer shifts and better coordination.
Conservative
Bob Zimmer Conservative Prince George—Peace River, BC
Thank you.
My next question is for Richard Phillips.
I liked what you said when you said that this isn't just about what government can do and that you want to fix this yourselves. That's refreshing for us to hear. That's a very Conservative mindset. We support you in that. We also agree with you in that we think a penalty was necessary to cause rail to come to the table to provide a fix. We think that was the necessary stick, as they call it, to make that happen.
But we also see this—or I see this—as a longer-term problem in logistical issues across Canada. Our minister has said we are doing a study to see what the long-term issue is with logistics. I guess it's a big answer. What do you see as the future, as the plan five and ten years out? In your mind, what should it be for our rail logistics issues in Canada? That encompasses all commodities, right? It's a bigger issue than just grain, as you know. Could you comment?
President, Canada Grains Council
Well, I think that on the grain side we will get organized. We will pull ourselves together. We will make our five-to-ten-year targets.
I'm not sure if all the other commodity shippers will do the same thing without some encouragement. I think that's a role for government. It's to make sure that the mining industry.... Whether you pull together a national round table of all the shippers or whatever mechanism you use, I think we need to get everybody doing that. On the grain side, I'm actually fairly confident that we will get everybody at the table saying, “Okay, where are you going to be in five years and where are you going to be in ten years?”
From that—because it's not just the volumes—we'll then ask what the actual bottlenecks are. Is it the car spots at the grain elevators? Is it that passing tracks aren't going to be long enough if they keep making trains longer? Where's that all going to happen? Is it all in the Vancouver terminals? Is it somewhere else? That's where we need to go with this. We need to know what those tonnages are and what mix of grains is going so that we can then ask, “Where will the problems be?”
Conservative
Bob Zimmer Conservative Prince George—Peace River, BC
Right.
Let me speak to all of you, and whoever has the answer can respond. We've heard over and over that coordination is necessary, but I guess what we need to wrap our heads around is how to do it. Who is going to be responsible for that coordination?
Give me some ideas on how you see that happening. We all talk about it, but somebody eventually has to be the chair and push this thing to get it done. So just give some suggestions. Please speak out, if you have an answer.
President, Canada Grains Council
I'll go first, and then I see Richard Gray also reaching for the microphone.
We in the Canada Grains Council have everybody in the tent already. I think our organization needs to show a lot of leadership. There is one suggestion. Maybe the others have other thoughts on who else could do it.
I'm not sure that creating yet another round table is the answer. I think we need to try tackling this internally by ourselves first. That's not just a conservative view. It's a good socialism kind of thing—
President, Canada Grains Council
—that feeling of getting together and working as a group.
Conservative
Bob Zimmer Conservative Prince George—Peace River, BC
Don't say that. That was good, until then.
Go ahead.
Professor , University of Saskatchewan, Bioresource Policy, Business and Economics, As an Individual
When it comes to logistics, I think it's important to have a third party with which information can be safely shared. Whether that institution reports to government or reports to industry or producers is somehow, I think, a different issue. But it has to be a third party that basically can keep what Glencore's sales are separate from Cargill's sales, but still be aware what the requirements are to put together a plan.
Conservative
The Chair Conservative Bev Shipley
Thank you very much.
Now we'll go to Madam Brosseau for five minutes, please.
NDP
Ruth Ellen Brosseau NDP Berthier—Maskinongé, QC
Thank you, Mr. Chair.
I'd like to once again thank the witnesses for being here and for being so understanding of the restraints and changes we've had here at the last minute.
Some issues and points have been brought up that have been reoccurring with our witnesses. Some of the things we have asked for are increased fines, mechanisms for actually compensating farmers, increasing the grain that must be shipped, providing clear and concise timelines for implementing these measures, joint running rights, and mandatory price reporting for more transparency.
We support this bill, but we have some concerns about it. It's the timing of these regulatory changes, and also the fact that there is no compensation. I'm hoping we can all work together to make this the best piece of legislation it could be.
So I wonder whether we could do a quick round with all of our witnesses so that they could comment on what they would like to see in the bill, on whether there is anything missing, and indicate whether they have any amendments, perhaps on the regulatory side, or something they want to see legislated in this bill.
Conservative
The Chair Conservative Bev Shipley
We'll start off with Mr. Bender, then go to Mr. Gray, then Mr. Hursh, and then we'll go to Mr. Phillips.
Director, Alberta Wheat Commission
Thank you, Ms. Brosseau.
Going to the points I outlined earlier, we want the corridor-specific requirement—we don't want anybody left out—so that there is no preference given to an alleyway that's easier to deliver to.
Again, we want a reference to the penalty for lack of service or non-performance. It's our desire, I guess, that this penalty not actually be used, but that it be a deterrent, so that the service would be there. As Mr. Phillips pointed out, it would mainly be just an underpinning, so the penalty would be in place to encourage the railways to provide the service. We hope it wouldn't have to get to that, but it would be there if needed.
I'll defer to one of my colleagues. I don't have all of my points right at the top of my head.
Professor , University of Saskatchewan, Bioresource Policy, Business and Economics, As an Individual
If I were going to just add one, it would be that better forecasting is absolutely essential. Forecasts have been dismal the last two years. I think we have to do a lot better job at that. It's quite easy to commit just a few resources and do a very good job of it publicly.
Executive Director, Inland Terminal Association of Canada
Picking up on Richard's last point, it's pretty easy to forecast what 2014-15 is going to look like, with 20 million to 25 million tonnes of carry-out, even given an average crop. So unless we have a huge drought evident, in June we're going to know that we're going to have a hell of a pile of grain to move. I think it would be reasonable to ask the railways how many resources they have dedicated to doing this and what their plan is.
And I think that within commercial arrangements we need reciprocal penalties. Right now there are penalties for the grain handlers and shippers if they can't fill railcars within a day, but there are no reciprocal penalties the other way, and that's what service level agreements are meant to sort out. There will be some trouble getting there with the service level agreements, unfortunately.
President, Canada Grains Council
Just following up on the forecasting part, I would say it's very true about the forecasting even within that current year. Maybe one thing we should look at is who will do this forecasting and get this data? Is there a bigger role for Statistics Canada to play, for example, in getting some of that data, or are we just relying on the private grain companies to supply this data publicly, which actually will be more challenging to get?
I think we need to look at where we can get that data from on a timely basis. Maybe StatsCan or some other body could provide some of that.
Conservative
Conservative
Earl Dreeshen Conservative Red Deer, AB
Thank you very much, Mr. Chair.
There are just a couple of things I want to go through. One part has to do with the car allocations per corridor. Of course when we had CN and CP here, one of the things they were saying was that there's a concern about some of the other shippers and whether or not we'll be able to deliver with them. But of course the numbers they came up with, the 11,000, were their numbers, and it's what they said they could manage. They also said it's going to take six months' lead time in order to be able to meet any other forecasts.
So I think it's important they have the six months. They have a chance to take a look at what other shippers will need. I think we shouldn't get ourselves caught up in that, because I think that's important.
This also looks at the terminal capacity. I believe they've also talked about what they are going to ship down each of these corridors. It isn't a case of them just picking numbers up. I think some people were fearing that what was going to happen was that they were just going to plug one of the ports, but that isn't what they said they were going to do. I think if any of you start to see that something like that is happening, certainly whoever it is looking at the logistics side of things has to take that into consideration.
The second point I want to talk about is the analysis of the delivery contracts. A lot has been said about the issues that take place and about the losses that are there. Most of what we have of course are now late deliveries on contracts that were perhaps made in November but they're not being looked at until February.
There are these great increased and spread-out bases we're looking at. However, the only people who are being caught up with those are the ones who are being forced to sell at this point in time. I can't remember who mentioned it, but certainly the advance program is something that's critical. We've finished off the fall advance now, and we're just looking at the spring advance to kind of make sure that if we're concerned about the cash flow that is associated with it, at least there is that option to buy in and to make contracts at different times. That doesn't change the fact that you need to make sure things are moving properly.
To finally get around to the question, I believe, Kevin Bender, you talked about the definitions of “adequate” and “suitable” and all of these types of things. I wonder if you could give us some thoughts on this. I know you wanted to see more specificity as far as those terms were concerned.
Perhaps we could start with that, and then maybe we could get some thoughts from others, if there's time, on some of these other issues I've brought up.