By Pulse Canada
April 2022
The federal government has begun taking action to address the container crisis. Last fall, frustrated with Canada’s slow response to the issue, Pulse Canada and groups from across agriculture and other sectors joined together to get the Canadian government to recognize the transportation issue for what it is—a threat to our global competitiveness and a hindrance to our struggling economy. Over the past several months, we have been actively raising this important issue through meetings with the federal cabinet, participation in government roundtables, and appearances at government committees. While the Biden administration treated the issue as directly tied to the strength of the U.S. (United States) economy, Canada had not. It was clear that action was needed.
Thanks in part to our efforts, the federal government has now launched a Task Force to look at broader supply chain issues, including ongoing system-wide resilience concerns. Their approach will allow the task force to address all elements of the supply chain that interact with containers. Pulse Canada is continuing to work to get the Task Force to prioritize early actions to improve supply chains as soon as possible.
Additionally, Canada’s Competition Bureau has joined a new working group to investigate potential anti-competitive behaviour and collusion by some supply chain stakeholders. The working group brings the bureau together with the competition authorities of the U.S., Australia, New Zealand, and the United Kingdom. Matthew Bosewell, Commissioner of Competition, stated the Competition Bureau will have “zero tolerance for any attempts to use pandemic-related supply chain disruptions as a cover for criminal collusion that harms consumers and damages Canada’s economy.”
This is why Pulse Canada helped found a cross-commodity initiative—containercrunch.ca—that calls on the federal government to act to fix the container crunch and the issues facing the containerized supply chain. The campaign asks for critical next steps to identify immediate solutions to the disruptions and will also help ensure that we can move to a new, more desirable state with improved operating levels and financial performance for all.
While the wheels are in place to begin mending the container issue, we cannot take our foot off the gas. In addition to containers, the transportation sector faces many other obstacles. On top of the container issue, our sector is currently facing historically poor rail performance. Generally, this is the time of year when growers start to see improving rail service as winter ends and much of the grain has already moved. However, with ongoing labour disruptions, a general lack of available rail capacity, and continued containerized supply chain issues, service issues are unfortunately expected—not just for moving grain, but also for incoming farm inputs.
How can pulse growers navigate the container crunch and mitigate potential transportation issues? Talk with your grain buyers early to understand the issues they are facing and what they are expecting from the transportation system. This will allow you to plan transportation and other logistics accordingly, mitigating potential delivery or financial delays.
As a result of the container crunch, our industry has experienced lost sales and cancelled sales contracts, which have impacted our competitiveness in international trade markets. At the same time as these excessive freight increases and poor service, container shipping profitability has hit record levels. It is predicted that collective carrier profits for 2021 will be in the region of $120–$190 billion. There is no doubt that a good portion of these profits has been extracted from the pockets of farmers, exporters, and Canadian consumers.
When given a level playing field, Canada’s pulse industry can compete in any market around the world. If we are to increase the production and exportation of sustainably grown, nutritious pulse crops, our industry needs access to a well-functioning, resilient supply chain.
Pulse Canada is continuing to work on behalf of pulse growers to get the government to prioritize the issue. Add your voice to the resolution and head to containercrunch.ca to sign a letter to the Prime Minister asking him to fix the container crunch and get the economy back on track.
We will continue to work on behalf of Canada’s growers, traders, and processors to accelerate the government’s action. To stay up-to-date with Pulse Canada’s efforts, follow @PulseCanada on Twitter and listen and subscribe to the weekly Grain by Train podcast. Visit PulseCanada.com to learn more.
