RESIDENTS of Churchill may be in for another hike in what is already a pricey food bill.
Freight train service to the community of 800 has been cut in half and an official with the North West Company said that could mean an increase in the cost of perishable foods by as much as 13 per cent.
NWC spokesman Derek Reimer said the extra cost will not be passed on to to consumers but Michael Spence, the mayor of Churchill is not convinced that will be the case.
"We made a business decision in the short term that we will not adjust our prices,’ Reimer said.
But Spence, who operates his own retail store in Churchill, said prices at the NWC’s Northern Store have already been inching up.
He believes the Winnipeg-based company, which operates stores in 131 communities in Canada, many in remote communities and many in First Nations, may be using the cut in rail service as an excuse to allow prices to rise.
Prices came down when the province implemented its own northern food subsidy program last fall called Affordable Food in Remote Manitoba (AFFIRM).
At the time, the province said it set up AFFIRM to address the north’s lack of accessible, affordable healthy foods, which contributes to higher rates of chronic diseases and of food insecurity.
That program was built to provide food subsidies to northern Manitoba communities that were not eligible for the federal program, Nutrition North. (Churchill was deemed ineligible because it has rail service.)
Since then, the price of a four-litre jug of milk, for instance, went down to about $5.99 from $11.
But Spence said Northern Store prices have been slowly rising.
"My prices are lower than the Northern Store,’ said Spence. "If (I’m) making a living at that price then those guys are doing very well.’
The reduction in freight train service to Churchill was not a surprise to Spence. He said the recent relocation of Calm Air’s service hub to Rankin Inlet likely helped reduce the freight service. It means less cargo — such as jet fuel — is required to service aircraft in Churchill.
The rail-service reduction comes as Omnitrax Canada is in the process of trying to sell the Hudson Bay Railway and the Port of Churchill.
Efforts to conclude a deal announced last month between Omnitrax Canada and a group of First Nations led by Mathias Colomb Cree Nation to acquire the Hudson Bay Railway and the Port of Churchill are continuing.
Neither Merv Tweed, president of Omnitrax Canada, nor Arlen Dumas, chief of Mathias Colomb Cree Nation, were available for comment Tuesday, but a source familiar with the deal said there’s plenty going on.
Specifically, a meeting has been set for today with Dumas and representatives of other First Nations to brief them on the transaction with the hopes of bringing others into a partnership.
Omnitrax is supportive of that deal and is said to be doing what it can to make it happen.
Dumas has already received some push-back from members of his own community in Pukatawagan.
He has said that some such opposition is to be expected and will not scuttle the deal.
Martin Cash has been writing a column and business news at the Free Press since 1989. Over those years he’s written through a number of business cycles and the rise and fall (and rise) in fortunes of many local businesses.
Updated on Wednesday, February 10, 2016 at 7:52 AM CST: Updates with writethru