Soy Canada Welcomes Long-Awaited Federal Grain Transportation Legislation
Soy Canada applauds the federal government’s recent tabling of legislation related to improving the transport of grains in Canada and new proposals to modernize rail service for exporters.
Bill C-49, entitled the Transportation Modernization Act, includes important accountability provisions related to railway reporting requirements, reciprocal penalties into service level agreements, defining “adequate and suitable” rail service and other measures that help ensure shippers are provided with dependable service.
“These reforms are a positive step towards enhancing the soybean industry’s ability to transport product to domestic and international markets,” said Mark Huston, Chair of Soy Canada. “Roughly 70 percent of Canadian soybeans are shipped overseas. Reliable and efficient rail transportation is key to ensuring strong market access from growing regions in both eastern and western Canada.”
While Bill C-49 also preserves the Maximum Revenue Entitlement (MRE) for the shipment of western grains, it falls short of adding soybeans to the list of Schedule II crops covered under this regulation.
“The soybean industry has nearly doubled over the last decade, with production in western Canada forecasted to reach 3 million metric tonnes this year,” said Ernie Sirski, Vice-Chair of Soy Canada and Board member of the Manitoba Pulse and Soybean Growers. “This massive growth signals the importance of adding soybeans to the list of crops protected by the MRE.”
The new legislation also contains new, potentially complex “long-haul” interswitching provisions, which will replace the current 160 kilometer extended interswitching limits set to expire in August 2017. It is unclear at this point whether the new interswitching mechanism will ensure shippers have access to competitive rates between rail service providers.
Soy Canada will be working closely with the sector and industry-government members of the recently renewed Crop Logistics Working Group IV toward addressing outstanding issues and providing recommendations for ongoing improvement in grain transportation.
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