moved:
That the House do now adjourn.
I would first like to thank the Speaker for allowing me to bring this grain crisis to floor of the House of Commons tonight.
Mr. Speaker, I will be splitting my time with the member for Winnipeg North this evening.
Over the next four and a half hours, farmers and their families will be watching MPs debate the crisis they are facing, and the money they are losing. I am hoping that many other Canadians will also be watching, so that they can have an understanding of the crisis at hand on the prairies. We hope that following this debate tonight that we can see more action from the government.
We have been hearing from many farmers and farm groups from across the country of the frustration they are facing with delays in shipping and the money they are losing.
This last fall, in November, I visited Manitoba, Saskatchewan, and Alberta. I witnessed firsthand the mountains of wheat, canola, and other crops that were building up outside of the grain elevators. I have seen the grain stored, not only in the elevators, but in machinery sheds and under tarpaulins.
At that time, many were very optimistic. The crop was good. The prices were good. They had customers. What more could one ask for?
I recall visiting Curtis McRae's farm in St. Andrews, Manitoba. He had over 30,000 bushels of wheat and 30,000 bushels of canola on his 5,000-acre farm; and it was a very impressive farm at that. He said that the local elevator was not taking any grain, as it was waiting for 600 cars to move the crop already at hand. That is just one example of the many thousands that we are seeing right across the prairies.
As a result, the prices started dropping. The prices have now dropped 40%. The problem is that there is no cost-benefit analysis and no business plan to manage the implementation of transportation. The Minister of Agriculture and Agri-Food even defended the railroad last fall, stating that the grain companies' performance was adequate. It clearly was not.
Promises were also made by the minister to bring forward new legislation to rectify the imbalance in the market power between the farmers and the railroads, to enable shippers to get a decent level of transportation service. Federal legislation introduced last June, the Fair Rail Freight Service Act, was supposed to deal with this situation. Well, it has not worked.
Many prairie farmers agree that the legislation needs to be amended to make it easier to hit the railroad companies with fines over these transportation bottlenecks. The current act is not effective.
We have to realize that over 95% of Canada's export grain is shipped by rail. Canada is the top canola producer in the world and the second largest exporter of wheat. We had over 100 million tonnes of crop out west this year. What a bonanza and opportunity we could have had, and there were customers for the crop.
When we look at the nation's two major carriers, CNR and Canadian Pacific, they say they are each providing 5,000 cars a week, and one is at 5,500 cars, to move the grain. However, that is not even half as much as we need.
Not only do we see this on the prairies with the railroads, there were 20 big ships waiting for grain in Vancouver and 5 ships waiting at Prince Rupert, the two grain terminals on the west coast, and that was on October 31. Today, there are between 30 and 40 vessels waiting to be loaded in Vancouver alone.
We can see that there is a big problem. We have the crop. We have the customers. We have the ships. However, it is just not getting there.
Ships have been idling for as long as six weeks in Vancouver, waiting for grain. It costs $12,000 to $20,000 every day in demurrage penalties. Who is going to pay for that?
I was talking to a farmer yesterday from Saskatchewan, and it is going to come right out of the farmer's pocket. That is who will end up paying for these delays.
Canadian-based grain companies have been charged more than $20 million in fees for delays at the port of Vancouver since August, according to the Western Grain Elevator Association. Some grain companies have sales for China, but they are not able to transport all their grain.
What has happened? What are all of the rail services being utilized for? They are being utilized for crude oil, potash, and other products. They are getting priority. The grain farmers are not, though, because there is no watchdog over the whole system. This is leaving as much as 3 million tonnes of grain stuck in the Prairies.
Canadian railroads shipped 34% more cars of fuel, oil, and crude petroleum in October. They are shipping more products than in the year before.
CP Rail reported a 19,900-car shortfall, according to a January service report. Outstanding grain car orders for CN totalled over 17,000, according to the January 17 report.
Let us look at some of the prices. Less than a year ago, wheat was selling for $9 a bushel; now, farmers are getting less than $4 for the same quality of wheat. That is less than half the price. The fuel costs are all the same, the seed prices are all the same, and the fertilizer prices are all the same, but let us look at the prices the farmers are getting—and those prices are only if they can sell it and get it to their customers.
The problem is not a lack of a competitive transportation system, but that the grain is in competition, as I said, not only with oil but also with potash and coal. These are other commodities that are taking up the rail space. They accounted for 54,000 cars in November. That is a big increase from the year before.
We have a loaded rail cars waiting at the elevators for up to 11 days. Then we have the demurrage fees, which I have already talked about, adding up to $20 million.
We look at all of these losses. What do they add up to? We are figuring out now that they add up to $1 million a day, all of which will come out of the farmers' pockets. Overall, they are losing $1 million a day. What does the minister do? He throws $1 million at the whole project for a study. It does not take much of a study when we call these growers from all across the country.
Let us have a look at some of the farm leaders across the country and some of the newspapers that we get in the Prairies. I will name a few of the farm leaders. I will quote what they say in some of the articles.
The first one comes right out of the Canadian Press. This gentleman is from Keystone Agricultural Producers. My colleague knows very well that it is the biggest agricultural organization in Manitoba. The article says:
Doug Chorney of Keystone Agricultural Producers said the backlog is so bad that mountains of wheat and other crops are building up outside jammed grain elevators.
As prices fall, farmers are wondering what good a record bumper crop is to them if they can't get it to market.
“There is grain in piles across Western Canada”, Chorney said from Brandon, Man. “This creates big cash-flow problems for farmers. We all have bills to pay”.
The minister came out and said that the government will give the farmers a small advance payment. The farmers have all these piles of grain, and the government is going to give them an advance payment. That has to be paid back. It is only going to be paid back if they sell their grain. I do not know where the rationale is, and I do not think that farmers feel any more confident.
That is in Manitoba. Let us move over to Saskatchewan.
Norm Hall is the President of the Agricultural Producers Association of Saskatchewan. I will quote from the newspaper what he said about the legislation that the Conservatives brought forward in June:
Norm Hall, president of the Agricultural Producers Association of Saskatchewan, said the Fair Rail Freight Service Act is just not effective.
He said the legislation needs to be amended to make it easier to hit railway companies with fines over transportation bottlenecks.
“There are no teeth...to make sure that it happens”, Hall said.
The legislation does include a provision for possible penalties of up to $100,000, but only if a government arbitrator decides a signed service agreement between a shipping company and a railway has been violated.
What is that going to do to make the rail service accountable?
That was out of Saskatchewan.
The Conservative members from Saskatchewan or the Prairies must have had an earful when they went home and were at the curling rink or hockey rinks over the last few weeks. It must be a hard go for them. However, there are answers and there are solutions out there.
Let me move over to Alberta.
Lynn Jacobson, president of—