MarketsFarm — Feed grain buyers in Alberta’s feedlot alley are well covered with contracted supplies, but the logistics of getting that grain where it needs to be are facing some uncertainty with looming labour action at Canadian Pacific Railway.
Buyers in feedlot alley are about 80 per cent covered right now, said Jim Beusekom of Market Place Commodities at Lethbridge.
With Canadian barley in short supply after last summer’s drought, most of that coverage consists of corn to be brought up from the U.S. — most of which is transported on the CP line that comes into the province from Montana.
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“So what it comes down to is logistics,” Beusekom said.
Roughly 3,000 CP employees could be locked out by the company by Sunday if an agreement is not reached before then. The workers, represented by the Teamsters Canada Rail Conference, have already voted to authorize a strike action if needed.
Beusekom estimated about 100,000 tonnes of corn a week were coming into southern Alberta via CP. While it would be possible to scrounge barley and feed wheat from across the Prairies or bring up some corn by truck, matching the rail shipments would not be very cost effective.
He expected livestock feeders were covered for a couple of weeks with the grain already on hand, but noted that it would not take a long railway stoppage to cause problems as it will take time to get back up to speed after a shutdown. A two-week labour dispute could leave feeders three to four weeks behind in their grain supply, with Canada’s new crop not to be harvested for another five months.
— Phil Franz-Warkentin reports for MarketsFarm from Winnipeg.
