Industry News

Congressman: Canadian rail mandate hurts U.S. farmers

Excerpt from American Shipper   | By Jon Ross  |  Thursday, August 14, 2014

The Canadian government’s agricultural performance mandate required of Canadian Pacific and Canadian National is hurting the United States grain market, according to Representative Kevin Cramer, R-N.D.

In a letter to Gary Doer, Canada’s ambassador to the U.S., the requirement, which demanded that the railroads carry 500,000 metric tons of grain per week or be fined up to $100,000 per day. Initially enacted to run from March to June 7, the timeline has been extended twice. Carriers are now under obligation to carry the weekly grain load through November. 

In his letter, Cramer wrote that this extension has the potential to make U.S. service issues worse, and added that the U.S. government might be force to enact measures similar to the Canadian mandate.

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“If the Canadian Government insists on continuing with performance mandates, I feel the U.S. has no option but to reciprocate in order to ensure our shippers are not disadvantaged by the actions of your government,” he wrote.  When the Canadian government first extended its order, Agriculture Minister Gerry Ritz, said, “This legislation creates the necessary tools to help ensure Canadian shippers have access to a world-class logistics system that gets their commodities to market in a predictable and timely way. Farmers and our economy need a system that works today and tomorrow, with the capacity to move what is grown.”

This rule has helped the Canadian grain industry whether a record harvest, but it’s been negatively affecting American shippers, Cramer said. 

“The potential discrimination this effort fosters against CP’s and CN’s U.S. customers is counter to Beyond the Border and overall general cooperation between friendly nations such as ours, as well as the combined economic power our countries have established,” Cramer wrote. “Unilateral parochial endeavors such as this potentially undermine our entire integrated system.”