It is five years since the 9/11 terrorist attacks. The Canadian trucking industry has not been immune from the fall-out as the US federal government responded to the tragedy by introducing among other...
It is five years since the 9/11 terrorist attacks. The Canadian trucking industry has not been immune from the fall-out as the US federal government responded to the tragedy by introducing among other things a spate of measures designed to tighten security at land borders – the first line of defense some have called it.
The US government’s desire, its obligation, to try to protect its citizens from terrorism is beyond question. US efforts also impact Canada’s security and our economic well-being. About 40% of Canada’s GDP is dependent upon trade with the US and if we want continued access, we have to play by their rules. The key, however, is to ensure that the twin goals of (a) improving security; and (b) not impairing trade flows, are met.
It has not been easy. Over the past five years, a never-ending stream of pre-arrival, pre-screening, credentialing and other measures have been introduced. One study for Transport Canada, conducted almost two years ago, estimated the costs to Canadian carriers at almost $300 million a year – a number that is surely higher today. We have suffered border delays. Some drivers and companies have walked away from the transborder business. As the industry doggedly carries on, trying to do the right thing, the question on everyone’s mind has been: “When will enough be enough?” Surely, with all the new requirements and with a number of others in the midst of being implemented, we had hoped this would be it for a while. How wrong we were. On Aug. 25, the US Dept. of Agriculture’s Animal and Plant Health Inspection Service announced that starting 90 days hence new inspections and fees would be imposed on trucks (and rail cars and air passengers) crossing the border from Canada into the US. The USDA states this is needed because of “an increasing number of interceptions on the border of prohibited material that originated in regions other than Canada…combined with (its) increased concerns about the threat of bioterrorism.”
For many years, Canada was exempt from the USDA inspection of agricultural products and associated fees because there was a very low risk that products originating in Canada harboured plant pests or animal diseases. The concern now is that some shippers are circumventing US sanitary and phytosanitary regulations by trans-shipping products other than those of Canadian origin through Canada to the United States.
The Federal Register Notice says agricultural products such as mangoes, litchis, guava, lemon grass, Spanish oranges and Dutch peppers are being re-labelled as “Product of Canada” before being shipped to the US. It says flowers grown in a third country are being mixed into bouquets of Canadian-grown flowers and then shipped to the US.
The USDA estimates that only 5%-20% of US-bound commercial conveyances contain agricultural products. Nevertheless, it is insisting that starting Nov. 24, ALL trucks regardless of their cargo pay a user fee of US$5.25 per truck (or US$105 for a yearly decal) to cover the costs of hiring 136 new USDA inspectors at the Canada-US border. The USDA estimates the total cost to the trucking industry will be over US$14.5 million per year. (This is on top of the US$5 per crossing – or US$100 per year with a transponder – Customs fee trucks already pay).
Having to pay what amounts to a doubling of the fees to cross the border (after having already absorbed the costs of complying with the myriad of other security measures) is repugnant, if not a trade barrier.
USDA seems to have taken this step in isolation – not only from the Canadian government but also from the central agency responsible for the border at the US Dept. of Homeland Security – which further raises the prospect of log jams at the border.
There are some serious questions that need answering. Does the level of risk warrant the inclusion of all trucks whether they are hauling agricultural products or auto parts – or is this like taking a sledge hammer to, well, a fruit fly? Why should the brunt of the enforcement activity and the costs rest solely with the trucker? Shouldn’t governments – including our own – be going after those products and people of concern? Aren’t all the existing systems of border pre-arrival and advance cargo information that industry and government has spent millions of dollars on supposed to ferret out the freight and exporters who may pose a threat? Aren’t there already internationally recognized food safety programs for shippers and transporters that can be relied upon? This latest announcement from the USDA reminds us that security continues to trump trade in Washington. Canadian governments and the business community must be ever vigilant with regard to the border – it is not just the truckers’ problem. Our customers, the shippers, need to be more engaged and share in the costs of securing their supply chains. The only way to do that is for carriers to charge for the costs of these programs and for the delays they cause. It’s easy to become complacent about these things, but we do so at our own peril.
– David Bradley is president of the Ontario Trucking Association and chief executive officer of the Canadian Trucking Alliance.