Mr. Speaker, I am delighted to be here tonight to take part in this debate. It is very unfortunate that there is a need for us to be here once again discussing slow rail movement. I have been here in Ottawa about 20 years and I have been through this discussion on slow rail movement and problems with rail movement a number of times.
In my life as a farm economist and a farmer before I went into politics, I went through this same situation many times, and I want to say that it hurts. It is hurting farmers now. Many in our caucus are still involved in farms. I am very much involved in a farm. This slow rail movement has hurt me personally in a very serious way. It has hurt the ten farmers, mostly young farmers, who rent land from me on a crop share basis, meaning that I pay part of the expenses and get a part of the crop. Every one of them is being affected in an extremely negative way by the slow rail movement.
The situation certainly is a very negative, unfortunate situation. We would all love to see it solved once and for all. It simply probably never will be, but I know that our government has done a lot of things that will help and have helped, things that have led to really good rail movement over the past few years.
I want to start by talking about the situation.
In western Canada we have a very unusual situation in that 85% of many of the crops we grow are exported. That is extremely unusual. The only other countries that might have a similar situation are Australia and Argentina, but most crops in Australia are grown within 200 miles of the coast, and Argentina as well certainly does not have the kinds of distances that exist in Canada in moving grain to a port so that it can be exported to the world.
In Canada a huge percentage of the crop goes to export. It is our only market. The shipments must travel extremely far, well over 1,000 kilometres, and 1,500 kilometres in some cases. Such distances make this a very unusual situation, and one that is really difficult to deal with.
Railways have been making record shipments of grains and all other commodities over the past few years. In fact, CN is really to be commended up, at least up until the last few months, for increasing its shipments of almost every commodity over the past four years. There was an increase each year over the preceding year. It is to be commended for that. It has done a great job. It has turned what was an average railway into probably the best railway in North America.
However, that does not let it off the hook for what it has not done over December and January, because that has hurt our farmers in an extremely real way and in a very damaging way. It has hurt them because they are not getting the income because their commodity is not moving. It has hurt them even more because the situation has driven prices down quite dramatically. I would argue that some of the grain companies are taking unfair advantage of that situation: they know this grain is not being moved to the coast, so they are paying less than they otherwise would if grain movement was better. That is a huge problem.
In fact, one of the young farmers who rents land from me called me tonight after this debate started. He said that he had phoned a couple of grain companies today to price some of the wheat he has to sell. He received an offer for April of $5.35. This is soft white wheat, so it is the least expensive type of wheat and is usually used for ethanol. In today's conditions, that price is not too bad.
That was a shipper 20 miles west of his farm in Saskatchewan. However, 20 miles south of his farm, the price offered was $3.50 a bushel. He told the guy he had been offered $5.35 just 20 miles west and asked why the guy was only offering $3.50. He was told it was because management had told them not to offer any more because farmers were going to be desperate and some of them were going to take it.
If that is happening, those grain companies are dealing unfairly. In a normal marketplace, I would say that it is the market, but it is not a normal marketplace when farmers and grain companies are held captive to a railway. I say “a” railway because in most cases farmers only have one option. They can choose either the CN line or the CP line that runs near their farm. They really only have one option.
It is not a free market, and that allows things to happen that really should not. That is why there is a place for government to be involved. The minister has been very much involved. He has been involved in this for months now. We knew mid-summer that we were going to have a huge grain crop. The minister started working with all of the parties involved back then. Clearly the railways did well in the first couple of months of the crop year, early in the harvest. I do not have the exact numbers for December and January, but I know that shipments have been way off, and the minister has been working on that.
The members across the floor talk about the five-year plan to fix the system. Quite frankly, that is a long-term plan. The minister has been working on a short-term plan as well. I am confident that we will have results from that. It is too slow for me. It is too slow for other farmers. However, it is certainly the best that we could expect.
I would argue that the Minister of Agriculture is absolutely the best that this country has had in decades, and I do not say this only because I am a Conservative member of Parliament. He is on top of these things. He is working for farmers. He is opening up new markets for farmers, which is extremely important, particularly with the huge increase in crops we are growing. We saw that this year, and I think we will see it for years into the future. The minister is doing an excellent job.
Having said that, I encourage farmers to continue to push the railways, the grain companies, the ports, and the government, to do more, and to do it more quickly, because what is happening now is completely unacceptable.
I am not here tonight because we are talking about an issue that is near and dear to my heart. I am here for this one thing that I have to do. It is really rich to me when I hear the members across the floor in the House complaining about slow rail delivery. Some have even complained about the increase in delivery of crude oil by rail. It is true that this has tripled just in the last couple of years. In fact, it may have tripled this year over last year. The members are complaining about that at the same time that they are doing everything to block new pipelines from being built. They should take some of the blame for this situation, and there is no way around that. They are blocking the pipelines. If oil is not being moved by pipelines, it is going to be moved by rail.
Rail is competing with grain movement and that is a problem, although I do want to give the railways credit for increasing delivery on all commodities until this last couple of months. They have to get their game together. CN has done a great job over the last four years. CP is starting to get it together, and that is encouraging. We, who move commodities so far in this country, really do depend on the railways to get our bulk commodities to market. There is no other choice. I would like the members across the floor to give that some serious consideration.
How bad are things? I have already explained an example about one of the farmers who rents land from me, and that kind of tells the story.
Some of the members try to talk about ending the Wheat Board monopoly. The Wheat Board is still there. Farmers can still ship to the Wheat Board. Some try to say that ending the Wheat Board monopoly has somehow exacerbated the situation. It is just the opposite.
I have watched these problems over the years, first as a young lad who grew up on a farm, then as a farmer and a farm economist working with farmers on marketing. This is not anything new, but it does not make it any easier.
How bad is it? It is bad. It is a problem, and it is depressing prices. What I am most concerned about is how bad it is going to be in March and April, as farmers are planning what to grow next year and the bins are still full.
I have wheat, oats, and even canola in long, white bags out on the ground. I even have canola in bags because I cannot move it. It is a huge problem. What am I going to do? More importantly, what are the farmers who farm my land going to do? I just get a third of the crop. They get two-thirds. I pay one-third of the expenses. They pay two-thirds. What are they going to do as they move up to seeding time? They are facing a huge problem, especially when they talk to the grain companies and the grain companies say they cannot contract this year's crop until next fall. Not only may the bins still be full, but a lot of farmers are not even sure they are going to have the temporary storage emptied by that time. That can lead to an awful lot of problems. That is how bad things are. It is extremely bad, and that is why it has to be dealt with.
However, I do give the Minister of Agriculture a lot of credit for what he has done, and I give my colleagues a lot of credit. We have dozens, I do not know how many exactly, of members of Parliament on this side who represent rural areas. We represent most of the rural areas in the country. There is a reason for that. We understand farmers. Many of us either are or have been farmers, so we understand them. Of course we are not going to let things go bad for farmers. We are going to do everything we can to make things better and do it as quickly as we can, not only because we have a vested interest but also because our neighbours and friends are farmers. Our constituents are farmers. We are doing all we can, and I do think we have done quite a bit.
Back in about mid-August, the Prince Rupert Port Authority had a meeting in Edmonton to which I was invited and which I attended. I talked to top people from CN Rail and the Port of Prince Rupert. The Port of Vancouver had representatives there too. I talked to representatives of some grain companies that handle this grain. I told them all that we were going to have a huge, record crop this year. I asked them if they were going to be able to move it, and they all assured me that they would.
Quite frankly, they have not delivered. I am bitterly disappointed that they have not delivered. The Minister of Agriculture is in the process right now of getting the real answers as to why they have not delivered and is strongly encouraging and pushing the railways, the grain companies, and the ports to turn that around.
One of our members earlier talked about the Port of Churchill and was complaining about what is happening there. The Port of Churchill is actually one of the bright spots. Grain movement last year in Churchill was 51% higher than the year before, so it is one of the bright spots, although grain movement has been increasing year over year. CN has been doing its job and CP is getting a lot better as well. There is some hope. The capability is there. The railways and the port authorities assured me that this can happen. CN, of course, is increasing capacity by getting more locomotives and by more double tracking, which is a key part of what makes things move faster. CP is starting to move in that direction too, but I would argue they are a lot slower.
What are the solutions? I wish I could say we could take that big stick that some of the members across the floor were talking about and have things fixed next week. Well, I agree that maybe a big stick is necessary, but I still do not think we are going to have things fixed by next week. It is going to take some time. My hope is that over this next month there can be huge, record rail movement and that we can at least see a light at the end of the tunnel and that the light will not be a locomotive coming through the tunnel with no grain on the train. Anyway, that is a little convoluted, but it is late at night.
My hope is that next month and the month after that, we will see record movement and catch up on some of what did not happen in December and January.
The railways and grain companies have not been performing, and that is not acceptable. What has our government done over the past few years to help prevent a situation like this? We cannot prevent it: we do not run the railways or the grain companies; we do not own the railways or the grain companies.
I believe a New Democratic member suggested earlier that the government should buy the railways and control them. To be fair, I might have misunderstood, but that is what it sounded like. I do not believe the NDP would propose that because it is outdated, something for the last century. I hope I did not misunderstand what the member was proposing.
That is clearly not the solution. The private sector is involved but the government does have a role to play. The federal government regulates the rail industry in this country, and rightfully so. That is the lever we have. That is the big stick.
I hope by some strong negotiations, by some quick discovery as to what the real problems are, that we can move this along and be in a much better situation a month from now and in the month after that, so that farmers can at least go into seeding with a good handle on what will happen. They can then base their seeding decisions on that. Some people who do not understand the farming business at all have asked me why farmers would seed a crop if they are not going to make a profit next year and their bins are full.
I talk to constituents on a regular basis. The young fellow who phoned me tonight said that he had pencilled it out and is going to lose money next year on his grain. Does that mean he should not seed a crop? No, because he has to cash flow payments on his land and equipment, even if he does not seed a crop. These are huge payments, so he has to seed a crop. With the way things look now the best he can hope for is to minimize his losses. In business that is one of the toughest things to learn. It is tough to acknowledge a loss. Sometimes that loss can be minimized, but take it and get out the best way possible. In agriculture, who knows?
Next summer farmers can see what is happening around the world. Prices could be up again, but perhaps not like they were last year. Farmers could be in a much better situation, but that is unpredictable. I am not going to stand here tonight and say it is going to happen, but it is a possibility. In the meantime, we need the grain to move. We need more certainty so that farmers seeding a crop can at least know what they are facing. That is absolutely critical. That is why our government has been working so hard on this.
In June 2013 we passed the Fair Rail Freight Service Act. That legislation gives shippers the ability to deal with a railway company that is not performing. Am I going to stand here and say that it is working for grain farmers right now? No, I am not. It is not working the way it should be working and we have to fix that. Things are obviously not perfect, so we have to fix that.
It was a very important change that we made that has helped a lot of sectors, and it will help the grain sector in the future. But it does not solve this problem; it has not prevented this problem. We will see. Maybe grain companies can use this. Maybe farmers can use this to help deal with the situation, but I am not counting on that.
I see that my time is almost up. I have rambled a bit here tonight but I am summarizing some of the things that are important after having listened to the debate tonight. I do want to give farmers some hope. I do believe that a month from now, and two months from now, things will be better than they are now. That would be a positive situation for farmers.
I will be meeting with two groups of farmers on this exact issue this weekend. The meetings have grown from two to three farmers to more than 10 in each group. They are going to give me some advice, which I will take to the agriculture minister. My colleagues are doing the same. I look forward to some good things happening in the next few weeks.
