Canada’s extensive railway network is dominated by two Class 1 freight rail operators, CN and CPKC. Extended interswitching is one of the only ways to inject competition into this system. Today, 97% of licensed primary elevators on the Prairies are located on a single rail line, leaving them captive to service from only one rail network. The extended interswitching pilot gives captive shippers the ability to seek competing service from the next closest railway if they are located within the 160km radius. Under the pilot, 70% of Prairie elevators are eligible for extended interswitching.
How does this impact farmers? At times, farmers are unable to deliver crop because their elevator is filled to capacity and awaiting railcars. Captive shipping situations can limit the ability for inland elevators to receive deliveries from farmers, which in turn restricts farmers’ ability to sell and be paid for their product. If delays persist, it can also affect the price a farmer receives for their crop if prices shift unfavourably.
The current extended interswitching pilot announced in the federal government’s 2023 budget is set to expire at the end of March 2025. The Flip the Switch coalition, which includes CCGA, has been calling for an extension of the pilot by an additional 30 months.