Canada’s supply chain shortcomings could have ripple effects on harvest Grain delivery delays are being feared as grain elevators approach 85 percent capacity. Farmers are hoping this year’s harvest will make up for last year’s disappointing crop, but disruptions in Canada’s supply chain could reduce agricultural revenues even further. As grain elevator levels reach 85 percent, the Western Grain Elevator Association (WGA) stated that capacity remains stable but uncomfortable. This has raised concerns about potential delays in grain delivery. In contrast to last year’s below-average harvest of 49 million tonnes, which was caused by drought, floods, and wildfires, this year’s Western Canadian grain harvest is predicted at 75 million tonnes, according to Wade Sobkowich, current executive director of the Western Grain Elevator Association. According to Sobkowich, 85% is a reasonable rate of success. Because of the domino effect on the supply chain, when the speed dips below that, there is a backlog at the grain elevators and fewer deliveries from the farmers, who aren’t paid until they harvested their crops. According to Agriculture and Agri-Food Canada, in 2016, the agricultural sector accounted for one in every nine jobs in Canada and contributed $135 billion to the country’s GDP. Sobkowich claims that farmers currently place orders for 10,000–11,000 railcars weekly. Canadian National Railway filled 88% of hopper cars, while Canadian Pacific Railway filled 77%, an increase of 73% from the previous week, according to the latest grain report from the AG Transport Coalition, which was released in September. Salem Woodrow, a spokesperson for CP, said in a statement that the company is ready to meet the transportation needs of its grain customers this harvest. She said that CP increased the number of hopper cars it sent out at the start of harvest season. This was when a record number of orders were filled and ports were unloaded. Sobkowich said that the way CP kept track of data, since the railroad company counted the demand, they accepted instead of the real demand. Caused the difference between CP and likely, CP considers itself to be doing better than our figures show. According to CN spokesperson Jonathan Abecassis, the company moved an all-time high of 2.62 million tonnes of grain in September, all of which originated in Western Canada. Abecassis said that the start of the year was slow for CN because the harvest started late and there wasn’t enough grain because of the drought the year before. Regulating train service is a lengthy procedure that cannot be completed overnight. According to Sobkowich, CN is maintaining a satisfactory rate, although we would prefer they approach 100%. Despite his assurances that the WGEA will keep a close eye on fulfillment rates, he expressed some fear that delivery delays might extend into the fall.  

Government’s $8 Million Fund for Improving the Logistics

Transport Minister Omar Alghabra said earlier this month that the Port of Montreal would spend $8 million on new grain terminal equipment and logistics to improve the overall quality of grain cleaning, improve traffic flow, and increase the number of containers that can be loaded and handled at the same time. At a press conference, Alghabra announced that “grain exports here at the Montreal Port will transport more than double” because of the money being provided. According to Alghabra, a new rail rule will soon be implemented, mandating increased transparency in the operations and performance of train businesses. However, the rules’ specifics have not yet been released. The minister made these statements after the National Supply Chain Task Force concluded in its final report that immediate action is required from the government and industry to keep products flowing in Canada.