Grain research goals laid out for excess railway cash

The heir to about $67 million in excess grain handling revenue from Canada’s two main railways now plans to get “more directive” in the types of grain research it will fund.

And the Western Grains Research Foundation Endowment Fund on Thursday laid out its priorities for what it calls a “directed research” program.

Previously, the WGRF’s endowment fund had allocated money to grains research using a “letter of intent” (LOI) project application process.

But while the fund will still accept such applications and fund approved LOI projects, it now will add a “request for proposals” (RFP) process, based on six new research priorities that include:

  1. crop breeding tools, such as breeding methodology, breeding processes, marker and genomics;
  2. post-harvest handling issues — that is, solving post-harvest problems that “diminish” crop quality and can cost farmers their market access;
  3. new crops and crop uses, developing opportunities both for new crops and for use of currently-grown crops in new ways (feed, biofuels, nutraceuticals, et cetera);
  4. pest and weather surveillance, focusing on ways to enhance, fill gaps and/or better co-ordinate existing activity in surveillance and monitoring for diseases, insects, weeds and weather impacts;
  5. fusarium head blight; and
  6. agronomic research, including impacts of fertilizer use, crop sequencing, fungicide application, seeding rates and development of a “whole farm” approach to production and profitability.

The WGRF said Thursday it plans to invite RFPs this summer for the first three of those six categories listed above.

The remaining three categories, however, call for some “preliminary investigation” to “more precisely” identify the research that will best serve producers, before RFPs are released, the WGRF said.

The WGRF said it now plans to approve funding for five-year directed research program (DRP) initiatives, worth $500,000 per year.

The foundation said it expects that by 2015, it will spend about $2.5 million a year on DRP initiatives and increase the total amount it spends on smaller LOI projects to about $825,000 per year.

Earnings from WGRF Endowment Fund investments are forecast to support these annual spending targets, the foundation said.

It added, however, that it still plans to seek co-funding partnerships and “institutional collaboration” with universities and other research agencies wherever possible.

The six DRP priorities were recently decided by the WGRF Endowment Fund advisory committee, following a consultation process with industry stakeholders.

That process, which began back in March, gathered responses from over 40 organizations, the foundation said Thursday.

“One-time increase”

The WGRF Endowment Fund was set up in 1981 with $9 million from a discontinued federal Prairie Farm Assistance Act program, and has since provided over $20 million in funding for over 200 projects across all crop types.

The fund was bolstered starting in 2000 under the Canada Transportation Act, which deemed the fund as the recipient for excess railway revenue beyond the set caps that govern what each of Canada’s railways can make by handling Prairie grain freight in a given year.

The WGRF’s added focus this year on the endowment fund’s priorities stems from the 2007-08 crop year, in which the railways’ revenue cap overages were made uniquely massive.

The Canadian Transportation Agency that year recalculated what railways could claim for grain hopper car maintenance expenses, and ordered the rail revenue caps lowered accordingly.

Canadian National Railway (CN) and Canadian Pacific Railway (CP) have paid a combined $67 million into the fund to cover their 2007-08 overages. The foundation held that money in trust until the end of the railways’ appeal process.

That “one-time increase,” compared to the railways’ usual (if any) overages, has “significantly increased the funds available to WGRF to support research in the coming years,” the foundation said Thursday.

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