Evidence of meeting #30 for International Trade in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was containers.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Clerk of the Committee  Ms. Dancella Boyi
Daniel-Robert Gooch  President and Chief Executive Officer, Association of Canadian Port Authorities
Doug MacDonald  Chief Marketing Officer, Canadian National Railway Company
Marko Dekovic  Vice-President, Public Affairs, GCT Global Container Terminals Inc.
Duncan Wilson  Vice-President, Environment and External Affairs, Vancouver Fraser Port Authority
Debbie Murray  Senior Director, Policy and Regulatory Affairs, Association of Canadian Port Authorities

11:05 a.m.

Liberal

The Chair (Hon. Judy A. Sgro (Humber River—Black Creek, Lib.)) Liberal Judy Sgro

I call this meeting to order.

This is meeting number 30 of the Standing Committee on International Trade.

There have been some changes in the membership.

I'd like to turn to Mr. Baldinelli.

11:05 a.m.

Conservative

Tony Baldinelli Conservative Niagara Falls, ON

Thank you, Madam Chair.

Good morning, everyone. Good morning, witnesses.

Before we start, I'd like work through a bit of committee business by nominating Kyle Seeback to be the vice-chair of this committee.

11:05 a.m.

Conservative

Colin Carrie Conservative Oshawa, ON

I'll second that.

11:05 a.m.

Liberal

The Chair Liberal Judy Sgro

The clerk will read the script.

11:05 a.m.

The Clerk of the Committee Ms. Dancella Boyi

Pursuant to Standing Order 106(2), the vice-chair must be of the official opposition.

I am now ready to receive motions for the first vice-chair.

It was moved by Mr. Baldinelli that Mr. Seeback be elected first vice-chair of the committee.

Are there any further motions?

Is it the pleasure of the committee to adopt the motion?

(Motion agreed to)

11:05 a.m.

The Clerk

I declare the motion carried and Mr. Seeback duly elected first vice-chair of the committee.

11:05 a.m.

Some hon. members

Hear, hear!

11:05 a.m.

Liberal

The Chair Liberal Judy Sgro

Welcome, Mr. Seeback, and congratulations. We're glad to have you.

Mr. Carrie, I'm really happy to have you on this committee. We've done lots of work together over the years. Welcome. This is a great committee. We do a lot of interesting work, and we welcome both of you.

Today's meeting is taking place in a hybrid format pursuant to the House order of June 23, 2022, and therefore members are attending in person in the room and remotely by using the Zoom application. I'd like to make a few comments for the benefit of both the witnesses and the members.

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Pursuant to Standing Order 108(2) and the motion adopted by the committee on Tuesday, September 27, 2022, the committee is conducting its study of potential trade implications of transporting goods in railway containers.

We have with us today, from the Association of Canadian Port Authorities, Daniel-Robert Gooch, president and chief executive officer, and Debbie Murray, senior director, policy and regulatory affairs; from the Canadian National Railway Company, Doug MacDonald, chief marketing officer; by video conference, from GCT Global Container Terminals, Marko Dekovic, vice-president, public affairs; and from the Vancouver Fraser Port Authority, Duncan Wilson, vice-president, environment and external affairs, and David Miller, senior adviser to the executive. These are all people with whom most of us are familiar, in a variety of capacities.

Welcome to the committee today. We're happy to have you here and we look forward to the information you will provide committee members.

Mr. Gooch, I will invite you to make an opening statement of up to five minutes, please.

October 18th, 2022 / 11:05 a.m.

Daniel-Robert Gooch President and Chief Executive Officer, Association of Canadian Port Authorities

Good morning.

Thank you for requesting our appearance today on your study of the status of shipping containers in Canada.

My name is Daniel Robert Gooch, president of the Association of Canadian Port Authorities, and I am joined by Debbie Murray, senior director with the association, Policy and Regulatory Affairs.

We represent the 17 Canada port authorities that move most of Canada’s international cargo and operate at arm's length of government to manage federal port lands. The rail companies, trucking companies, vessel owners and operators and terminals are key partners for ports within the supply chain.

Containers revolutionized shipping when they were introduced over 70 years ago and have become the standard multi-purpose mechanism for transporting goods and commodities from hinterland to port to vessel/multimodal.

Given the centrality of containers to shipping, when there are broader system impacts and trends to shipping, this can have significant impacts on container movements and availability. COVID-19, geopolitical issues and labour challenges are examples of factors that have caused challenges with container supply.

We have all heard stories of containers delayed or a shortage of containers. With the increased use of containers for grain and other formerly bulk exports, container shortages now also affect Canada's exports.

In Canada, container movements are dependent on rail and truck movements, and the intermodal connection with vessels at Canadian ports, where backhauls of both filled and empties ensure continued movement of containers to destinations for loading and unloading.

We are hearing from our members that intermodal capacity in supply chains remains under pressure, particularly for containerized cargo. While Canadian ports are not experiencing as much congestion as those in the U.S., average wait times have increased and there is a domino effect. Many importers have been delayed in taking possession of their goods.

Similarly, storage and floor space for containers is scarce. As a result, the railroads have been forced to prioritize less congested corridors. For example, the Port of Montreal tells us it has had to deal with a backlog of containers on the ground, sometimes with an average dwell time of up to 40 days. The port became an open-air warehouse, with almost 12,000 containers at one point.

You will hear from Port of Vancouver about the increasing number of vessels that have had longer waits at anchorage because of container movement or availability delays.

What can be done to relieve pressure and build a responsive, safe, secure and reliable supply chain, and ensure that container supply and movement continues to be reliable in the years ahead? The national supply chain task force report, released earlier this month, yielded many excellent recommendations that could address container movements, including immediate regulatory and policy changes to address congestion and inefficiency; digitalization and supply chain visibility; support for enhanced port financial flexibility; and a long-term, future-proof transportation supply chain strategy.

Our country needs such a strategy, one that incorporates a multi-stakeholder approach to ensuring that current and future capacity and reliability are there for Canada, and one that factors in climate change and other shocks to the system. We understand that the development of a national strategy is part of Minister Alghabra's mandate, and so we look forward to understanding more about the government's plans in developing this strategy.

A key part of it must be supply chain visibility: knowing where the goods and containers are and where the bottlenecks and available capacity are. This visibility relies on digitalization and data governance. We have the tools and the data, which we see as our ports' and industry players' pilot digitalization and visibility initiatives. We also look forward to understanding more about the $136-million federal digitalization initiative announced last Friday.

For ports specifically, there are elements we are hoping to see in Minister Alghabra's coming work on ports modernization and amendments to the Canada Marine Act to allow Canadian port authorities to more nimbly fulfill their role within supply chains.

Financial flexibility, through the ability to access interested private capital to build port projects and invest in optimization, is key, as is permanent national trade corridor funding. The ability of ports to purchase land off-site for the establishment of secondary sites for the movement of containers would also enhance local and regional efficiency, and accelerated port projects through the impact assessment process would also assist the development of physical supply chain infrastructure.

There is other low-hanging fruit that could help. The United States allows for en route customs clearance of containers, which allows containers to be moved into the U.S. prior to their formal release. Canada does not have the same practice. Harmonizing with the United States on this could facilitate movement.

Canada Border Services Agency's sub-location container policy could also be updated to allow for containers to be moved to another location for clearance from their initial point of unloading.

Containers will continue to be used to move manufactured goods into the country and move commodities out of Canada's ports. We have an opportunity with all the focus and collective thinking aimed at supply chains and container movements today to ensure that this continues in a reliable, innovative, safe and secure manner for decades to come.

Thank you.

11:10 a.m.

Liberal

The Chair Liberal Judy Sgro

Thank you very much, Mr. Gooch.

Next is Mr. MacDonald, please.

11:10 a.m.

Doug MacDonald Chief Marketing Officer, Canadian National Railway Company

Thank you.

Good morning, everyone.

Thank you for allowing the Canadian National Railway Company, CN, to contribute to the committee and provide information on what has impacted the 2022 supply chains in Canada, as well as some potential next steps that would benefit all participants who move goods in and out of Canada.

CN is a major contributor to the import and export of goods for Canada. In 2021, CN moved over 5.7 million shipments of freight across its network, with over 30% of that being import or export business. Primary commodities moved for export are grain, coal, potash, propane, pulp, ore concentrates and many more. Imports are more concentrated around containers filled with retail merchandise.

These supply chains are normally in balance and follow a low-inventory model whereby products are moved close to a just-in-time model. With the beginning of COVID, these supply chains experienced significant disruptions in demand that caused many peaks and valleys for supply. The supply chain challenges really accelerated in late spring of 2022. Consumer demand was going strong and retail stores ordered substantial inventory to avoid the stockouts that had occurred the prior winter. This led to a dramatic increase in imported containers, which flooded the west coast ports. These containers then moved inland to intermodal terminals for final delivery by truck. These imports quickly filled warehouse space in Montreal and Toronto while waiting for the peak sales season in the fall. The imports soon backed up when storage filled, so retail stores left the containers in terminals, which then backed up the containers at the ports, followed by ships waiting to unload at full terminals.

With the fragmented supply chain, there was no one source of information that was occurring so that participants in the supply chain could plan and react in a timely manner.

What did CN do? First of all, I would like to highlight the role that Transport Canada played in bringing all the participants together to find solutions. CN led the charge in finding solutions where none were offered. We quickly implemented additional capacity expansions at key terminals in Montreal and Toronto. CN opened additional third party container yard storage at multiple sites in Toronto. CN also quickly leased the shuttered Valleyfield intermodal terminal and reopened it to take in trains bound directly for Montreal.

These solutions released the pressure on port terminals, allowing volumes to move from the ports to inland terminals so that the end customers could pick them up and ports continued to receive shipments. All these solutions came at a cost: CN ran extra trains, added significant overtime to terminal employees and added resources in drivers and chassis where available.

The result of these actions had the container backlog in Montreal cleared by the end of August. We just closed the Valleyfield terminal, as the current volumes are at a level that CN's Montreal terminal can handle. For Toronto containers, CN was able to clean up almost the entire backlog prior to the end of September. To be clear, this is a CN-led solution to a non-rail supply chain issue.

There continue to be delays in the last-mile delivery of containers. Warehouses continue to be full. Customers continue to use containers as interim storage with the current warehouse situation. CN is continuing to work with customers to balance terminal and rail capacity, resulting in the timely pickup of containers so that there is space for new containers to come in, as well as taking in empties to go back to ports or to other loading points for exports.

As the saying goes, the supply chain is only as strong as the weakest link. Attention must be paid to the performance of all participants for the supply chain to function optimally. I will now highlight some areas for improvement on all supply chain participants.

The first step is better data coordination and integration for all members of the supply chain. For container imports, the supply chain needs to know details as soon as the container leaves the origin port on its way to a Canadian port. This information is currently transmitted to the CBSA for customs approval. This information would provide the ports with an ETA, the container's destination so that they can place it in the port facility for either rail or truck furtherance, a description of the contents and weight for proper positioning in the train, and any preparation needed for final pickup and delivery from the inland terminal. Currently, none of this data is made available to supply chain partners.

CBSA also has older IT systems and processes that prohibit flexibility in the supply chain. While CBSA acknowledges the need and value, we are not aware of any progress on that front.

Additional infrastructure is also required. In order to handle more volume in the existing supply chains, capacity expansions must be undertaken. This includes port infrastructure, rail capacity and inland terminal capacity. If Canada wants to have spare capacity available on short-term notification, then the government will need to focus on funding this type of infrastructure. The NTCF program is a good solution for this. It needs to be fully funded and used for this infrastructure.

Canada also has one of the longest timelines to approve infrastructure investment, making it impossible to quickly adapt to a changing supply chain. In order for Canada to expand in trade, the government needs to streamline the process for infrastructure investment in Canada. By way of example, it took CN over seven years to get its Milton intermodal terminal approved. These delays threaten the agility of the supply chain to respond to emerging issues or crises.

Regulation in Canada continues to slow down or stifle investment decisions as well. Canada's national transportation policy provides that regulation and strategic public intervention are used to achieve economic, safety, security, environmental or social outcomes that cannot be achieved satisfactorily by competition and market forces. I submit that regulation has departed from that guidance and needlessly interfered with market forces that would deliver better results for the market participants and the global economy. If the need to regulate exists, it must be based on hard evidence and tailored to address real issues, rather than issues presented through a perspective of certain market participants. Uncertainties and lack of evidence-based regulation create uncertainties that deter investments in Canada versus other countries with a consistent policy agenda.

Last, the government needs to promote further automation of the supply chain while considering the ESG impacts of those changes. All supply chain participants will continue to automate while reducing the impact on the environment. The government can help in these areas by funding innovations that provide the largest impact for all Canadians. This would all need to be done with a solid implementation plan with safety embedded in every area.

Thank you.

11:20 a.m.

Liberal

The Chair Liberal Judy Sgro

Thank you, Mr. MacDonald.

Next we have Mr. Dekovic, please, for five minutes.

11:20 a.m.

Marko Dekovic Vice-President, Public Affairs, GCT Global Container Terminals Inc.

Good morning, Madam Chair and members of the committee.

Thank you for the invitation to be with you today as you continue your important study.

My name is Marko Dekovic, and I'm the vice-president of public affairs at GCT Global Container Terminals.

I am speaking to you today from the traditional and treaty territories of the Coast Salish people in British Columbia.

GCT is headquartered in Vancouver and operates two container terminals: GCT Vanterm, with a capacity of about 850,000 TEUs, located in Burrard Inlet in downtown Vancouver; and GCT Deltaport at Roberts Bank near the city of Delta, with a current capacity of 2.4 million TEUs. It is currently Canada's largest container terminal, but the Prince Rupert Fairview terminal is quickly catching up. We are tenants of the Vancouver Fraser Port Authority and direct employers and infrastructure investors where Canada's rail network meets tidewater.

GCT is a majority Canadian-owned company with three institutional investor shareholders: the Ontario Teachers' Pension Plan, British Columbia Investment Management Corporation and IFM Investors. Our active experience in this sector uniquely positions us to provide input to the committee related to your current study.

First we have to reflect on the causes of the supply chain challenges. The effects of the pandemic and climate change on the global supply chain in the last years have brought a series of major disruptions to the overall network. Canada was not immune. We have seen them materialize in manufacturing, trucking, raw materials, supply, inland storage, and distribution. Moreover, the extreme weather in B.C., namely the devastating floods and forests fires, furthered the problems, with the closing of the rail lines resulting in backups of cargo ships at anchorages in the Port of Vancouver.

At present, from our perspective, the railways have been utilizing capacity at our Vancouver intermodal terminals to truck in imports from the ports to help ease the congestion. In recent months, we have also seen a more fluid network with daily rail car supply being more consistent, even though outbound trains have been restricted at times by congestion and capacity issues in Toronto and Montreal warehouses, as you have just heard from CN before me.

However, increased rail surge capacity is urgently needed in order to support restoration of Canada's supply chain fluidity. CN and CP are the only two railways that move container trains into and out of metro Vancouver. It is important to consider in your study that approximately 35% of all inbound containers entering Canada's west coast ports hold discretionary cargo headed for the U.S. by rail. This means that importers and shipping lines, at their discretion, can redirect containers through other ports on Canadian or U.S. west or east coasts depending on variables such as price differentials, rail dwell times, reliability of rail and terminal services and even port authority fees.

It is also important to note that about 70% of containers that arrive at our GCT Deltaport terminal are rail-bound. If containers are not being evacuated at an appropriate rate by rail, the container dwell time will increase. Terminals will be congested, and soon enough, vessels calling those terminals will back up at anchorages. No matter how many container terminals or operators you have, if the rail supply is not keeping up with the demand, the system will congest.

This leads me to my next point.

It has been suggested by the Vancouver Fraser Port Authority that container terminal capacity has been a contributing factor to supply chain challenges and that a proposed Roberts Bank terminal 2 will somehow solve them. That is not the case, as it will be connected to exactly the same rail lines as the existing terminals. The west coast container terminal capacity has not been a contributing factor to supply chain challenges. In fact, Canada has container terminal capacity available to meet current and future demands well into the 2030s.

At GCT, we're doing our part as a private operator, optimizing and investing in infrastructure to support our customers' needs. In 2018, GCT invested $300 million in the semi-automated intermodal rail yard densification project, which has provided superb rail cargo surge capacity at the recent times when it was most needed.

When it comes to solutions, it is all about surge capacity and collaboration; there is no single solution to this problem. The government has a role in facilitating the collaboration that ultimately must be executed by supply chain partners through experience and commercial relationships. It must include a holistic approach and consider inland container storage, inland warehousing, and flex capacity that will make the supply chain more resilient and fluid when the next natural disaster, hard winter, pandemic or blockade hits. The recent supply chain task force report has identified some good recommendations for immediate actions in this regard.

GCT strongly supports efforts being made by our rail supply chain partners toward capacity increases and resiliency upgrades. GCT knows that improvements to Canada's rail system will improve the movement of Canada's trade domestically and to key U.S. and international markets.

Thank you again for the invitation to appear today. I look forward to questions.

11:25 a.m.

Liberal

The Chair Liberal Judy Sgro

Thank you very much.

Mr. Wilson, go ahead for five minutes, please.

11:25 a.m.

Duncan Wilson Vice-President, Environment and External Affairs, Vancouver Fraser Port Authority

Thank you, Madam Chair.

Good morning. My name is Duncan Wilson, and I am vice-president of environment and external affairs with the Vancouver Fraser Port Authority. I am joined by my colleague David Miller, senior adviser to the executive.

We are pleased to be here today to discuss issues related to the impact of container traffic on Canadian trade, which is central to the business and success of the port of Vancouver.

The port of Vancouver is Canada's largest port, handling $275 billion worth of cargo annually. A wide range of products and commodities move through our 29 major marine cargo terminals. We are extremely proud of our environmental record, and are focused on achieving our goal for the port of Vancouver to be the world's most sustainable port.

The port currently has four container terminals in operation, and we are optimistic that we will soon get approval to move forward with the construction of a fifth terminal located in the key Roberts Bank area.

Our container business has grown rapidly over the past decade, reaching 3.7 million TEUs in 2021. While we did see a decline of 7% mid-year in 2022, that was largely attributable to COVID-related lockdowns in China and impacts from the extreme weather events in late 2021, which washed out roads and rail networks east of the port for two weeks. This slowed and disrupted traffic for months, well into 2022. That was then followed by terminals in Ontario and Quebec not having space to receive the containers, which stranded containers in the port and on board ships.

Our container business is vital for importers and exporters across the country. The public has learned a good deal about supply chains in the past few years, and now know that a wide range of consumer products, parts, and components for manufacturing travel to Canada by container.

The export business is less well known, but extremely important for Canada. Canadian exporters in many sectors move their products to market in containers. This includes products which traditionally moved in bulk or break bulk, such as forest products, and some agricultural products, such as pulses and specialty crops. In addition, food products such as meat, fish, and shellfish move in refrigerated containers.

As I mentioned, extreme weather challenges impacted container traffic in 2021 and carried over into 2022. Container ships normally move on set routes on predictable schedules. Pre-COVID, it was rare to see container ships at anchor at the port. They arrived on schedule and went directly to a terminal to unload and load. However, COVID and particularly lockdowns in China have disrupted schedules, led to backups, and made schedules less predictable. In Canada, this has meant congestion at container terminals and congestion at rail terminals and warehouses in eastern Canada.

I was just in Asia with other members of our executive, meeting with some of the steamship lines that serve our port. What we heard was consistent with what we have been hearing for some time: They need more capacity and would like to have more options in terminal operators.

This message reinforced the importance of increasing terminal capacity at the port, and that requires getting our new Roberts Bank terminal 2 project approved and built.

We are currently completing an expansion of the Centerm terminal in Burrard Inlet. That expansion, which increases the terminal's capacity by 60% while only increasing the footprint of the terminal by 15%, will be virtually sold out when it opens at the end of this year. This is something that was reinforced in our meetings with shipping lines in this most recent trip.

The new RBT2 container terminal will be located at Roberts Bank, an extremely strategic location for Canada, as it has no air draft or water draft restrictions. The new three-berth terminal will increase capacity at Roberts Bank in a phased manner and bring in a third operator, adding to DP World, which operates two terminals in Vancouver and Prince Rupert. GCT operates the other two terminals in Vancouver. To date, we have signed 21 mutual benefit agreements with first nations that are very supportive of the project.

In addition to added terminal capacity, we continue to move forward on a number of infrastructure projects that will remove bottlenecks and improve rail and truck access to the terminals. We have achieved significant benefit from numerous projects, partially funded under the national trade corridors fund and its predecessor. These included major road and rail projects along the corridor to Roberts Bank built in anticipation of Roberts Bank terminal 2.

We are also working with Transport Canada and our supply chain partners to develop transparency and reporting tools and processes that will help everyone in identifying problems and solutions.

In conclusion, I would emphasize that we are confident that container traffic through the port of Vancouver will continue to grow in the coming years and decades. We believe Canada's container sector, which includes the ports, the terminals, the trucking sector and the railways, has done a good job dealing with the disruptions and other challenges related to both the pandemic and the weather-related disruptions.

We are also proud of our record in ensuring that growth has not had, and will not have, a negative impact on the environment.

We appreciate the opportunity to appear today and we look forward to your questions.

11:30 a.m.

Liberal

The Chair Liberal Judy Sgro

Thank you very much, Mr. Wilson.

We will go on to the members. We have Mr. Baldinelli for six minutes.

11:30 a.m.

Conservative

Tony Baldinelli Conservative Niagara Falls, ON

Thank you, Madam Chair.

Again, thank you and welcome to our witnesses this morning.

I'd like to thank our colleagues for undertaking this study. We all have a perspective of how it impacts the national economy. It was interesting.

A small business came in to me on Friday to discuss the challenges that they're facing with regard to getting their containers and the increased cost that is being placed on them because of the congestions and issues that they are facing. It's timely, and I thank the members for being here.

I'm probably going to follow up with Mr. MacDonald, first of all, because I'd like to relate some of the issues that my constituent has with her small business, which has been in operation for about 30 years. They're bringing in a container from Italy to the port of Montreal. It may be one container a week or it may be two or three if things are of benefit to them. They're seeing huge backlogs in Toronto, and storage fees and waiting time fees.

She wrote to me and related that just in June, because of the economy and gas prices, they were starting to see those invoices passed along to them, and that was fair enough, but then they were also starting to see in June and July that they were getting additional charges for wait times. Even though the company has agreements to be there and pick up their goods, they're being charged additional fees over and above their agreement if those companies have to wait. They're also being charged for returning empty containers that, for example, may go back to yards that have no place to put them, so the company then keeps them, and that joins these additional costs.

In fact, the business received an email in July saying, “...we ask that you suspend sending us orders until further notice. We need to clear up the current orders before we can accept any more.”

How does one do business like that? You're being asked to stop doing business, essentially.

We see these great delays. I was pleased to hear you say, Mr. MacDonald, that you've essentially cleared the Montreal backlog as of August, and you're talking about the current backlog in Toronto as almost being cleared. You talked about when you believe that will happen and what needs to occur.

Would the facility that's planned in Milton address your future operations by having those facilities and yards available, as opposed to having to immediately rent additional facilities?

11:30 a.m.

Chief Marketing Officer, Canadian National Railway Company

Doug MacDonald

That's a great question. You're accurate on all your numbers.

Would Milton help? The answer is yes, absolutely. We have tried to get Milton up and running for the last seven years. It's finally under construction after basically eight years of going through the process of getting it approved. That would have easily helped out and given us the surge capacity to handle what's happening today.

At the same time, when Milton eventually fills up, because Canada will continue to import more, we will continue to need to expand, either in other terminals or by having other partners where we could put containers for that surge capacity.

All of the rail infrastructure, like most customers, is built around that just-in-time model. Containers come in and they go out. Customers used to not pick up their containers for two days or five days; now we're talking 30 days. That's because they don't have a warehouse to put them in. The containers stack up in the terminal quickly. That's why you're seeing increased fees. It's to try to encourage people to come and pull their containers out and get them out so that we can bring in more from the ports.

Surge capacity is critical, and we're going to need to continue to build that into the future.

11:35 a.m.

Conservative

Tony Baldinelli Conservative Niagara Falls, ON

In terms of the operations, are you also impacted by issues such as labour shortages or issues with the skilled trades?

The recommendations that were put forward recently.... We talk about increased digitization, but that's going to take some time. That doesn't immediately help my constituent, who's facing those backlogs and additional charges now.

How much longer is she expected to continue taking on these additional costs, and when can these backlogs be finally addressed?

11:35 a.m.

Chief Marketing Officer, Canadian National Railway Company

Doug MacDonald

None of it was labour-related. It was all space-related. We had full staffing at the terminals. It's just a matter of being able to process all those containers through that terminal at that time and having customers come and pick them up.

We thought there was a shortage in trucking capacity, but it turns out the truckers didn't have warehouses to put them in. With the warehouses full, we couldn't get the trucks to come in to pull containers and take them out. It backlogged the entire system.

11:35 a.m.

Conservative

Tony Baldinelli Conservative Niagara Falls, ON

I will ask about the additional fees that were charged for the extra yards. I think under our briefing note, it was something like $300 for the CN yard in Mississauga. Is that directly billed to the transportation company, which then passes on the cost to the small business?

11:35 a.m.

Chief Marketing Officer, Canadian National Railway Company

Doug MacDonald

It's whoever is coming to pick up the container. We don't even have the information. When that container comes in from one of the big steamship lines, it gets dropped in our terminal, and that's where our information stops. They contact the end receiver, who would be your constituent, to arrange to have it picked up. They make a reservation through their drayage company to come pick it up. We don't know who the container belongs to, what's in it and how long it's going to sit there.

11:35 a.m.

Conservative

Tony Baldinelli Conservative Niagara Falls, ON

In terms of cost, the excellent briefing note that was prepared by our staff says that rail freight generates about $10 billion in our economy. I was just wondering if anyone can put a figure on what these backlogs, these delays, have done to the Canadian economy in terms of cost.

11:35 a.m.

Chief Marketing Officer, Canadian National Railway Company

Doug MacDonald

I cannot, because it would be more on the retail side. I don't think anyone's calculated it, to my knowledge.

11:35 a.m.

Liberal

The Chair Liberal Judy Sgro

Thank you very much, Mr. Baldinelli.

We have Mr. Virani for six minutes, please.