APAS calls for freight rate overpayment to be returned to farmers.
January 21, 2009
Regina- The Agricultural Producers Association of Saskatchewan (APAS) added its voice to the growing demand for the 2007-08 grain freight revenue overage to be repaid directly to producers.
“Farmers were overcharged by more than $2.00 per tonne for railway transportation of their grain last year. For most of us that represents thousands of dollars,” said Greg Marshall, President of APAS. “On behalf of all Saskatchewan grain farmers, we are calling on the federal government to find a way to get that money back into producers’ pockets.”
Canadian National Railway exceeded its $409 million cap by nearly $26 million while Canadian Pacific Railway was nearly $34 million over its $374 million cap, according to the Canadian Transportation Agency (CTA). This is the largest amount that any railway has exceeded its revenue cap as well as the second time that both railways are over their caps in the same year. The revenue cap is designed to help keep rates affordable for farmers and shippers in the absence of railway competition for grain transportation from Western Canada. Under the CTA ruling, the companies have 30 days to pay the money plus 15 per cent fines to the Western Grains Research Foundation (WCGF), which funds research projects on behalf of Prairie wheat farmers.
“As producers, we want the railways to be profitable because we need good service. Instead, it seems we keep paying more while service gets worse,” continued the APAS President as he repeated the call for a full railway cost review. “The rail revenue cap on grain freight is based on outdated railway cost numbers that haven't been reviewed since 1992 – when there were 1,000 more Prairie elevators for the railways to service."
Marshall understands that the Western Grains Research Foundation (WGRF), the intended recipient of the overpayment and penalty, continues to play a vital role in providing research that benefits farmers; but he feels that the unprecedented size of the overage warrants special action in this case. The APAS Executive agrees with the proposal put forth by the Western Grains Elevator Association (WGEA) to return the overpayment of almost $60 million directly to producers and to invest the 15% penalty, equaling nearly nine million dollars, in the continuing work of the WGRF.
“Producers are already facing an eight percent increase in rail costs this year alone,” Marshall continued. “Fertilizer, fuel and every other input cost went up this last year and farmers paid the price. But in this case, where our producers overpaid by such a significant amount - there can be no excuse for not returning that money to the people that were overcharged in the first place while still investing in continued research.”
APAS, along with the Canadian Wheat Board (CWB), Canadian Federation of Agriculture (CFA), National Farmers Union (NFU), Keystone Agricultural Producers (KAP) and Wild Rose Agricultural Producers (WRAP) are jointly calling for a full railway cost review. Concerned producers can send an email to their Member of Parliament by visiting the CFA website at http://cfa-fca.ca/pages/emailer.php or by following the link at www.apas.ca
APAS is Saskatchewan’s general farm organization formed to provide farmers and ranchers with a democratically elected, grassroots, non-partisan, producer organization based on rural municipal boundaries. As the voice of agriculture in Saskatchewan, APAS represents the views of all agricultural stakeholders in order to form comprehensive policies that benefit all sectors of agriculture.
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For more information, please contact:
Greg Marshall, President – Tel: 306-789-7774 (ext 222) or 306-746-7747 (cell) or email president@apas.ca
Nial Kuyek, General Manager – Tel: 306-789-7774 (ext 229) or email nkuyek@apas.ca