For Immediate Release
 
 
March 30, 2015
 
 
Report puts price on future rail access limitations that Saskatchewan can’t afford
 
The Saskatchewan Chamber of Commerce is pleased to unveil today a report commissioned by the Chamaber from the Conference Board of Canada : The Impact of Rail Access on Saskatchewan's Export Potential.
 
“After the problems our exporters experienced in the winter of 2013/14 the Saskatchewan Chamber contracted the Conference Board of Canada to conduct this research,” explained Saskatchewan Chamber CEO Steve McLellan. “We recognized then the absolute necessity of getting ahead of any future rail supply chain issues.”
 
Using the provincial government’s Plan for Growth targets, the Conference Board studied the estimated growth in demand for Saskatchewan’s ten main export commodities. The research concluded that to achieve 71% of the Growth Plan’s target for 2020 from these commodities the rail system will have to transport, at minimum, an additional 20 million tonnes of goods relative to 2012.
 
“This represents almost a 50% increase in originating tonnage,” continued McLellan. “And with close to half of the province’s exports [by value] relying on rail for some part of their journey, the importance of rail supply chain capacity cannot be overstated.”
 
Failure to establish the required capacity would have a tangible negative impact on the provincial economy. According to the Conference Board’s estimates, meeting only 80% of this increased demand for rail transportation would result in a total negative GDP impact of $3.6 billion, while meeting only 90% of it would have a negative impact of $1.8 billion.
 
“The rail backlog experienced in the winter of 2013/14 cost a lot of industries a considerable amount of time and money, something that we need to take strategic action on now to avoid repeating, and exacerbating, again in the future,” concluded McLellan. “Incurring such large costs for a problem we could start solving today would be a disservice to the entire province.”
 
To improve the efficiency of Saskatchewan’s rail-based supply chain and ensure that it will not be a constraint to export growth in the future, the Conference Board made nine recommendations in the report:

• Investigate the full impacts of the Maximum Revenue Entitlement (MRE).
• Reduce the cost of shipping by rail to and from the province
• Encourage greater and timelier communication across the logistics supply chain
• Increase coordination with governments and infrastructure providers outside of the province
• Increase supply chain options and redundancy
• Consider the full effects of legislative solutions while focussing efforts on long-term rather than short-term solutions.
• Determine the current capacity and the “right size” of on-farm storage
• Determine the impact of pipeline expansion opportunities
• Examine alternative hopper car purchasing arrangements

 
To read the full report please visit: http://bit.ly/Skchamber or for a quick look at some of the recommendation details, see the background information below.
 
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