WINNIPEG, Man. — If grain haulers are finding they’re hauling a lot less grain this year, it’s probably because there’s simply a lot less grain to be hauled.
Droughts in Alberta and Saskatchewan are projected to result in more than $100 million in losses to Winnipeg’s grain industry according to the Dominion Bond Rating Service (DBRS).
Each of the eight major grain companies are bracing themselves for major losses in grain handling this year and next and the Canadian Wheat Board is predicting the supply of export grains will plummet 20 per cent this year due to the drought.
“The timing of the drought is terrible for grain companies,” David Schroeder, financial analyst of DBRS tells local media, noting grain companies are struggling to restructure. “Everything that could have gone bad, has gone even worse than we predicted. The worst case scenario is occurring.”
Meanwhile, grain companies are cutting back costs, and Agricore recently merged with United Grain Growers in a move that will eliminate hundreds of jobs and force more elevator closures.