Evidence of meeting #69 for Transport, Infrastructure and Communities in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was c-49.
A video is available from Parliament.
President and Chief Executive Officer, Mining Association of Canada
It's both, and how they play out. It's changeable depending on the circumstances, depending on who you are, depending on the shipper. You could experience one or both, and it changes over time.
Liberal
Ken Hardie Liberal Fleetwood—Port Kells, BC
Take us through a typical transaction.
How is it set up? How can and does it go off the rails?
President and Chief Executive Officer, Mining Association of Canada
Joel gave an example in the forestry sector, which is the same experience in the mining sector. You expect a certain number of cars on a certain date and that number doesn't show up. We had one member who was told by the railways that they weren't going to serve them at all. On the service side, it can really vary.
In terms of pricing, they get to control the price. There is no competition, so they set it the way they choose to set it. They pass on costs very liberally. I recall when B.C. first introduced its carbon tax, the very same day the railroads were announcing they were increasing their rates to pass the cost of the carbon tax on to the shipping community. That's what you can do when you have a monopoly situation.
Brad, do want give specific examples from your experience?
September 13th, 2017 / 12:25 p.m.
General Manager, Logistics and Planning, Teck Resources Limited
Okay.
To echo what Pierre said, we're talking about meeting very specific delivery windows for our customers for our exports. At times, we can wait weeks, if not months, to satisfy our orders. We provide forecasts. We have vessels coming. We have orders. When we don't meet them, it's a very big financial penalty to a company like Teck. As I said, yesterday, it has been in the range of $50 million to $200 million over different periods over the last decade.
Conservative
Kelly Block Conservative Carlton Trail—Eagle Creek, SK
Thank you very much, Madam Chair.
My next set of questions will be for the Mining Association.
Mr. Gratton, I want to ask you a question around the three-week delay in providing data. Earlier this week, we heard testimony that Canadian railways already provide more detailed information in regard to the operations happening in the United States. They provide that on a weekly basis.
I'm wondering if the present government, with Bill C-49, should have moved to more closely align the railways reporting requirements in Canada with those in the U.S.
President and Chief Executive Officer, Mining Association of Canada
My understanding is that this bill does more closely align with the United States. What we're saying is that it's not adequate. The U.S. system was designed decades ago. There is the issue of the amount of data that's made available, because in the United States it's a sampling of data, it's not all data. Then it's the issue that Joel has also addressed, which is the timeliness of that information. It can be very dated.
We're saying with the technology that we have now, there's no reason why the information on waybills can't be uploaded and provided. There's no reason.
I know that people like to say we should at least align with the United States. I think we haven't been for decades. Now we have an opportunity to go beyond what the U.S. provides and provide information that we all need to hold the railways to account, but also, as we discussed earlier, to identify those infrastructure challenges that we may have in different parts of the country.
Conservative
Kelly Block Conservative Carlton Trail—Eagle Creek, SK
I also want to follow up on the reference you've made to competitive line rates in comparison to the long-haul interswitching. I had an opportunity to ask our Transport Canada officials on Monday to describe the difference. A number of witnesses have made that comparison.
I'm wondering if you could describe the differences between competitive line rates and long-haul interswitching, or the similarities which then make it ineffective as a remedy.
President and Chief Executive Officer, Mining Association of Canada
Brad, I think I'm going to ask you to take that one.
General Manager, Logistics and Planning, Teck Resources Limited
I'd say the similarities are that they both have issues. In competitive line rates, as they exist today, essentially the railways don't compete against one another. That's why it's been an ineffective remedy, and it's been little used over the last 20 or 25 years.
Long-haul interswitching, for the mining sector, just because so many areas essentially are geographically barred.... This morning we even had a discussion trying to figure out who in the mining industry might be able to use it. It's not at all clear to us. Certainly, anyone operating in British Columbia, in the entire province, is barred from using long-haul interswitching as it's defined. That's quite astonishing, but in fact, that's the way we interpret it. With respect to areas in the east, in Ontario or Quebec, because of the corridor definition between Windsor and Quebec City, I can't figure out who might actually be able to use the thing. To be candid with you, unless that geographic piece is fixed, I don't know, at least in mining, who might even use it. Therefore, I haven't spent a lot of time thinking about it.
Conservative
Kelly Block Conservative Carlton Trail—Eagle Creek, SK
I recall during our study on C-30 that we heard from various stakeholders such as the forestry industry and the mining industry that they would like the same opportunity for interswitching and extended interswitching that had been provided to grain farmers through the Fair Rail for Grain Farmers Act. When you relate that back to the exemption corridors or the exclusion zones, have you seen any rationale that makes sense to you for why these zones or corridors were created and put into this piece of legislation?
President and Chief Executive Officer, Mining Association of Canada
We can only assume the railways fought against it and that's why we have these exclusion zones. This attempt essentially maintains the C-30 provisions. Essentially there is a piece of Canada in the Prairies that could benefit from this, much as they did through Bill C-30. I think this has just found a different and more creative way of accomplishing the same thing. I assume if it were more opened up in central Canada or in eastern Canada it would simply force the railways to be more competitive with one another, and they don't want that.
NDP
Robert Aubin NDP Trois-Rivières, QC
Thank you, Madam Chair.
I also want to thank Mr. Hardie, who has asked a number of questions I was planning to ask. To return the favour, I will give the next two minutes to Ms. Simard, so that we can hear her answer, which also interests me.
Director, Legislative Affairs, Shipping Federation of Canada
To be clear, we're talking about introducing something for seafarers working at a lower wage. Actually, those vessels that are coming to Canada have been coming for more than 120 years. These vessels are regulated by a body of conventions that Canada has helped develop, including the labour requirements on vessels. These are the laws that apply to those vessels. However, to imply that all the seafarers on board ocean-going vessels are badly treated would be quite a disrespect to the seafarer professions. These seafarers work on carriers, and there are over 1.6 million seafarers working on ocean-going vessels. That's more than 55,000 ocean-going vessels trading internationally.
Are there cases when one ship comes to Canadian waters and doesn't have good standards? Yes, it's possible. Do we have cases in Canada where we drive on the highway over the speed limit? It is possible. Does it make all of us non-compliant and subject to road rage? I don't think so. That's the same thing for a very large industry that works with over 55,000 vessels. These are regulated by standards. Those standards are enforced by the Canadian authorities and they have working conditions that allow people to survive on board vessels and thrive as a carrier of seafarers.
To put things in context, can I have 30 more seconds?
Director, Legislative Affairs, Shipping Federation of Canada
It's the thin edge of the wedge. We're not asking to blow up the Coasting Trade Act, as has been mentioned; we're not here for that.
I'm going to bring you back, however, to another example, that of the U.S. We know they have the Jones Act. It is very strict in ensuring that they protect their domestic fleet. The concept of liberalizing the moving of empty containers is in the Jones Act, so is the ability to use it in vessel-sharing agreements so that the partners in vessel-sharing agreements in the U.S. can move their empty containers. We are not, then, asking to blow up the Coasting Trade Act with this amendment. We're just asking that the amendment be implemented and fully implemented to recognize that container carriers operate under vessel-sharing agreements.
Does that help?
Liberal
The Chair Liberal Judy Sgro
We could push it a little bit, Mr. Aubin, if you have another request.
All right. Thank you all very much.
We've completed our first round. Before we dismiss the witnesses, does anyone have any special questions that they didn't get a chance to get out?
I'm looking over on this side. Now that I have done so, I'll have to look over on this other side. I'll have to look at anyone who has a really important question that you want to get answered.
Mr. Badawey.
Liberal
Vance Badawey Liberal Niagara Centre, ON
Thank you, Madam Chair Sgro. I have a question to the shippers with respect to the discussion we've had on Bill C-49 about operational remedies, when moving containers around utilizing marine resources.
I want to touch on one thing that we haven't touched much on for the last couple of days and that may be very relevant to you. That is the capital side of shipping, and the Shipping Federation's opinion and recommendations on the overall system when it comes to both salt water and the Great Lakes.
What is your position on Canadian ports being allowed to access the Canada infrastructure bank and the financial instruments contained within the infrastructure bank to help fund expansion projects? Will this be helpful, in your opinion, in making Canadian ports more competitive?
I want to expand that question to also include not only Canadian ports that are designated as port authorities, but also the St. Lawrence Seaway itself on the Great Lakes. Is there opportunity, in your opinion, to expand on the capital side to enhance the business opportunities for yourselves, speaking on behalf of your organization, as well as for others who ply the waters of Canada and those beyond the borders of Canada?
Director, Policy and Trade Affairs, Shipping Federation of Canada
On the infrastructure side and with respect to having ports access the Canada infrastructure bank, yes, conceptually it could be helpful. I think we would want to look at it from a trade corridor and a network perspective.
You have a port such as the Port of Vancouver, which is growing exponentially, which is building all kinds of infrastructure. You can see how this would be useful to them.
If you come to the St. Lawrence Seaway or to the St. Lawrence-Great Lakes system, we have infrastructure needs in this part of Canada as well, so this is potentially interesting. We have been making a case for quite some time for the need for more icebreakers to support the system here and to support navigation through the winter months, which is a huge aspect of having a reliable trade corridor, and also for potential infrastructure needs on the east coast.
Theoretically, then, yes, it would be helpful. I might just try to punt that question a little bit, though, and say that we'll expand on it in our written comments.
Liberal
Vance Badawey Liberal Niagara Centre, ON
Madam Chair, that's why I asked the question. I ask that such information to be passed on to us—more detailed information.