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Have western farmers been sacrificed for Big Oil?

Council of Canadians chairperson Maude Barlow Tweeted these questions this afternoon, “Were western farmers sacrificed so that Big Oil could take over the trains? Is that why Harper killed the Wheat Board?”

Our ally the National Farmers Union has commented, “The current chaos in grain transportation is caused by the loss of the Canadian Wheat Board’s coordination at port terminals, as well as by the lack of enforcement of the statutory obligation for rail companies to move prairie grain. The Canadian Wheat Board, with its single desk authority over sales and over railroads and port facilities, ensured the system was orderly and worked efficiently to achieve premium grain prices and minimize transportation costs for prairie farmers for more than 75 years.”

Yesterday, the Canadian Press reported, “Canada’s two major railways — Canadian Pacific Railway and Canadian National Railway have been accused of making oil and other products a higher priority than grain.”

What do the railway companies have to say about this?

CPR CEO Hunter Harrison says, “all commodities in the entire supply chain are impacted by this brutal weather”, that “Canada’s largest-ever grain crop and this winter’s weather created the perfect storm”, and that his “employees have been working around the clock to keep traffic moving.”

Not all are buying that spin.

The Financial Post reports, “The oil industry uses special cars to move oil, but competes with the grain industry for locomotives and crews, (says) Wade Sobkowich, executive director of the Winnipeg-based Western Grain Elevator Association. …(He says) it’s obvious rail companies are apportioning their capacity differently — with the oil and gas industry getting a larger portion and the grain industry a smaller one. Insufficient capacity has resulted in a shortfall of 55,000 orders of railway cars since last year’s harvest.”

This morning, the Winnipeg Free Press reported, “The federal government says it will introduce an order-in-council forcing railways to move a minimum amount of grain each week. Transport Minister Lisa Raitt says that minimum will be set at 500,000 tonnes, which works out to 5,500 grain cars each for Canadian National and Canadian Pacific. She says there will be penalties of up to $100,000 a day if CP and CN don’t meet the requirement. The government is giving the railways four weeks to ramp up to the minimum level.”

But the Globe and Mail notes the limited and late nature of this announcement, “Ottawa’s move, which is in force for 90 days, follows months of complaints of poor service by grain handling companies and farmers, who are struggling to get a record crop to market amid a shortage of rail cars.”

And harsh weather or not, the situation is set to get worse. “TransCanada Corp. forecasts rail transportation of oil out of Western Canada will increase from 400,000 to 500,000 barrels a day in 2014 and to one million barrels a day by 2015 because it is virtually unrestricted.”

And so Barlow’s questions remain, “Was killing the Wheat Board another move, like gutting all freshwater regulations, to expand the tar sands?”