The Canadian government last week announced that it was extending the Fair Rail for Grain Farmers Act (Bill C-30) for another year while the Minister of Transport assesses the Canada Transportation Act Review.

Grain Growers of Canada (GGC) welcomed the announcement, saying the rule has already made for more competitive freight rates and service, and has directly benefitted farmers.

“Not only have farmers noted reduced costs; they have also gained more leverage in getting railcar capacity where needed,” GGC said.

The Fair Rail for Grain Farmers Act, an amendment to the Canada Transportation Act and the Canada Grain Act, was initially established to alleviate a severe grain backlog during the 2013-14 harvest season.

The act not only established minimum volume hauling requirements for railroad companies like Canadian National Railway and Canadian Pacific Railway, but it also extended rail interswitching rights, which have provided Canadian grain producers with alternative options for rail services.

The amendment ensured that producers would receive reimbursement for any expenses incurred as a result of a railway company’s failure to comply with its level-of-service obligations, giving Canadian grain farmers a more predictable and stable source of revenue.

“The extension of Bill C-30 will provide both government and producers appropriate time to reassess the bill while a long-term solution for improving Canada’s rail transportation system is developed,” GGC president Gary Stanford said.