Canola farmers are complaining to the Canadian Transportation Agency about what they call "dismal" service from the country's two biggest railways.
The Canadian Canola Growers Association says Canadian National Railway Co. (TSX:CNR) and Canadian Pacific Railway Ltd. (TSX:CP) have not fulfilled their obligation to move Western Canadian grains and oilseeds to market this crop year.
The group's complaint cites provisions in the Canadian Transportation Act that requires railways to provide "adequate and suitable" accommodation for all traffic their customers want moved.
"The breakdown of the Western Canadian rail transportation system this year is completely unacceptable for grain producers," said Brett Halstead, president of CCGA and a farmer from Nokomis, Sask. "Ultimately, it is farmers who are bearing the cost of this supply chain failure."
The arms-length regulatory agency will issue a determination within 120 days of receiving the complaint.
In recent months, Western Canadian farmers have been expressing growing frustration about their inability to move a record grain crop to market by rail.
The railways say they've done everything they can considering the sheer volume of grain, combined with unusually harsh winter conditions.
"This situation is about a 100-year crop and the worst winter in decades — not about a level of service failure by CN. CN is moving record grain volumes so far this crop year and has fared better than all other railroads during this difficult winter," said Mark Hallman, a spokesman for the Montreal-based railway.
"The Canola Growers Association's complaint is unfounded and ill-advised. CN is a backbone of the economy and a true supply chain enabler with an agenda that is aligned with customers. CN will vigorously defend its record and reputation in front of the Canadian Transportation Agency."