‘This is catastrophic to agriculture’: CEO, Providence Grain on national rail shutdown

Severe impact from national rail shutdown National rail shutdown could severely impact Western Canada's grain industry.

The national rail shutdown could cost the Canadian economy a billion dollars a day. Chief executive officer of providence Milt Miller joined CTV Morning Live’s Kent Morrison to highlight the severe impact on Western Canada’s grain industry.

Kent Morrison: As harvest begins, a lot of cash is on the line. 94% of Western Canada's grain is shipped by rail. First of all, your immediate reaction seeing last night that a deal couldn't be struck, and now this has really ground to a halt.

Milt Miller: Well, simply put, this is catastrophic to agriculture, to the province, in every facet, there's a massive amount of industry that relies on the rail every day. Just in the central area of Alberta, so sort of from the Edmonton region down to Red Deer across to the Saskatchewan border, there's close to probably $17 million a day of grain deliveries being delivered to the various elevators and processing plants. All routes rely on rail to move it back out. And you know, to be clear, that money is just repayment of money that has been spent to grow that crop. That's not even considered income, that's just covering expenses. And that happens beginning now, non-stop through. It doesn't even let up in volume until the end of December before it starts to slow up a little bit.

Kent: So farmers are out there right now pulling this off the field. Where does it go in the meantime, if the trains aren't moving?

Milt: Well, it's going to pile up in the field. It's going to go into grain storage on the farms. It's going to go into some of the elevators that we operate for a short amount of time. But you have to understand that when the farmer delivers, we write a cheque and pay them for the grain. There's a significant cost of not having it moved, I mean, massive cost. Not to mention the fact that grain is already sold. This supply chain counts on the railway to get this to a port, and in most cases, whether it gets in a container or into a bulk vessel, it's already sold to a customer overseas. So immediately, daily, the industry, from the farm gate on, is in default.

Kent: How long do you think producers and farmers can sustain this work stoppage before this really starts to cost a lot of money, or is it already too late?

Milt: It can handle a few days, but at the end of the day, the responsibility of our government is to get these two parties to the table.

Kent: Now what's your message to those two parties? They all know the stakes, but it seems like they can't come together on this. What would you say to those people at the bargaining table?

Milt: Well, they've been negotiating for a long time, and obviously it's not going very well. Somebody is not willing to give enough on one side or the other. So, in my mind, it's the responsibility of our Federal Government. There is legislation, pieces in place to force these two parties to binding arbitration. Which in my mind, is fair, because both party and arbitration are going to have to give something up.

This transcript has been edited for length and clarity.