Farm Credit Canada responds to impact of Prairie grain transportation problems

Farm Credit Canada is ready to help Western farmers who might not be able to plant their 2018 crop because they haven't been able to sell enough grain this winter because of railway transport delays“We have been monitoring the grain movement situation for the past number of weeks and are aware it could have an impact on our customers' short-term cash flow through the busy spring season,” said Michael Hoffort, FCC President and CEO. “We will support customers as needed, and continue to ensure they have the financial means to get their crops in the ground this spring. FCC rolled out a similar program in 2014 when the railways fell way behind on grain movements to West Coast ports.“We feel it is important that we be proactive and ensure our customers know that we are here to support them and have tools available to reduce the impact on their business from these unforeseen challenges that are beyond their control,” he said.Agriculture Minister Lawrence MacAulay said his department will work with FCC to monitor “cash flow concerns and ensure producers potentially impacted by delays in grain delivery have the flexibility they need.” Farmers short funds for seeding this spring's crop should consider applying to the federal Advance Payments Program for repayable funds.The program offers cash advances for stored or planted crop of up to $400,000, the first $100,000 interest-free. Under the APP, the federal government guarantees repayment of cash advances issued to farmers by producer organizations.The FCC actions were announced as the Canadian Federation of Agriculture urged the government “to make low-cost program changes that would provide emergency income support to cash-stricken grain farmers in western Canada. Farmers get paid once their grain is delivered and the current shortage of rail cars has left many growers in a financial crisis.”CFA said the government could expand the provisions of the Advance Payments Program, which would offer immediate relief by giving farmers access to interest-free loans to pay outstanding bills and purchase seeds, fertilizer and other products needed to begin seeding this spring's crop.The Conservatives and NDP have asked the government to speed up passage of its transportation modernization bill. While that will address long-term rail system challenges, short-term income supports are required and could be implemented quickly, CFA said. “Efforts to get more trains moving will not resolve the dire cash-flow crunch happening now. Grain growers require additional tools to bring their operations back to sustainable levels.”Grain Growers of Canada (GGC) President, Jeff Nielsen said, “Across Western Canada grain isn't moving, and we need all parties to work together to get the railways to act.”The federal government needs to “use all tools in its toolbox if service does improve dramatically.CN announced it was taking immediate action to deal with the backlog. “"We apologize for not meeting the expectations of our grain customers, nor our own high standards," President and CEO Jean-Jacques Ruest, who took over the helm of CN from Luc Jobin on an interim basis.“The entire CN team has a sense of urgency and is fully focused on getting it right for farmers and our grain customers, regaining the confidence of Canadian businesses and protecting Canada's reputation as a stable trade partner in world markets. Moving the Canadian economy is in our DNA. We can and we will do much better and that starts today — no excuses.”CP said that extreme weather took its toll through much of February, but that it was now starting to recover. “We are optimistic that with the weather turning in our favour, our singular focus on delivering safely for the supply chain, and the re-opening of the Port of Thunder Bay, that we are on the road to recovery,” CP CEO Keith Creel said."While our challenges have been significant, they are different than that of our competitor's and the success of the supply chain depends on both railroads running at optimum levels.Alex Binkley is a freelance journalist and writes for domestic and international publications about agriculture, food and transportation issues. He's also the author of two science fiction novels with more in the works.