Wednesday, 20 August 2014 15:54

Railways continue to plague the agriculture industry

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“Confirmation bias” is  to gather information to confirm existing beliefs.     
To judge if a business is good is based on money, whether it makes us more, or saves us more. That is how we should look at our grain handling system. There are farmers on both sides of the fence about the old Canadian Wheat Board (CWB).   
Some complain about grain movement this past winter. In 1996/97 CN and CP could make more money moving things other than grain.
On behalf of farmers the old CWB filed a Level of Service complaint. CN paid voluntarily, CP went to court and paid a hefty fine. They never pulled that trick again until last winter when there was no old CWB to contend with.
One expense we are saddled with is demurrage, $15,000 to $25,000 per day per ship. Barring a heavy rain, the old CWB could get a ship on its way in four days. This year it took 65 days for one 55,000 tonne ship to be on its way.
The old CWB knew when ships were going to arrive so sourced the proper grain from country elevators.
Just in time it would be in Vancouver, cleaned and ready to load when the ships arrived.
This year, at one time there were more than 50 ships anchored, waiting. This cost, probably more than $1 million a day, is passed along to farmers in what is called “the basis.”
Basis is the money grain companies charge farmers to cover their cost of selling grain.  
There are many other examples of expenses included in the basis.
Now, the bigger basis is why farmers are getting less of the export price than the 80 per cent they used to get with the old CWB.     
I have not seen any numbers showing an economic benefit to the farming community due to the current system.   
Because of the huge increase in the basis charged for selling wheat, if I conclude the old grain marketing system was better than the new, can I be accused of ‘confirmation bias’?
Lorne Jackson, Riverhurst, Sask.

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