The Weyburn Inland Terminal mostly agrees with Farm Rail Car Coalition policy on western farmer hopper car ownership, but "unanswered questions" about rail car governance within the FRCC's proposed governing structure leave CEO Rob Davies wary.

"No seats are assigned to grain companies - how is that reasonable?" Davies asked in an interview after the company's 28th annual shareholders meeting on Thursday afternoon at McKenna Hall.

The FRCC, the largest single-issue farm organization in Canada with representatives from 17 different farm Canadian farm groups, is poised to take possession of the federal government's fleet of 13,000 rail cars this summer.

Coalition literature states group ideals as providing ownership for western Canadian farmers of their own rail car fleet with an emphasis on ensuring reliability and adequacy of supply. The FRCC says owning a common fleet of rail cars will eliminate switching and improve efficiencies by reducing rail car turnaround times.

They're also buoyed by the prospect of western Canadian grain farmers, for the first time, owning a large asset in the grain transportation system.

While Davies makes clear WIT does not disagree with the objectives of the FRCC, he worries the plan-to-date is not fully representative of farmers or of grain companies like WIT.

"Companies like WIT who were hammered out by farmers have an awful lot of money invested in this industry, and we're not allowed to have any say in how this fleet gets managed," he said.

He fears that exclusion will leave both individual farmers and grain companies at the mercy of board of directors with nine of 12 seats already permanently assigned, but none to grain companies.

"(FRCC) Governance is already pretty well established. We don't think it's representative of farmers, first of all, and clearly it's not representative of the (grain-handling) industry. The FRCC has to ensure a balanced board that provides balanced direction to whoever ends up managing this fleet of cars."

"Our opinion isn't that the FRCC is bad; their goals are good. We're just very confused about how they get there."

Until the parties resolve these doubts, WIT would rather the federal government retain control of the rail cars and honour their maintenance commitments by replacing damaged cars and repairing those that can be fixed.

"The issue is to reduce cost to farmers," he said. "We want to ensure that whatever solution Transport Canada and the FRCC come up with meets the business needs of farmers and industry."

FRCC president Sinclair Harrison could not be reached for comment at the time of publishing.

Also on Thursday, company president Claude Carles announced 2004 pre-tax earnings of $2.97 million at the meeting, down considerably from $4.23 million in 2003, though crop input sales of $15.5 million and lower operational costs due to smaller crop loads in 2004 kept the company well in the black.

"Efficiencies built into the terminal and the continuing strong support of our customers have allowed WIT to stay profitable," he told the crowd Thursday.

"Sound investments and no long-term debt are paying off today. Our Lake Alma elevator, the livestock feed pelleting operation, and Vigro Seed and Supply operations all contributed to earnings."

A "favourable resolution" by Revenue Canada regarding the status of the terminal's cleaning and drying assets pumped 2004 after-tax earnings to $3.89 million versus after-tax earnings of $900,000 last year. This extra revenue helped maintain the 2004 annual dividend at $1.00 per share, roughly what was paid out in 2003, said Davies.

"Different assets are used for different things. We're a grain-handling facility but we also do cleaning, drying, and blending. Facilities that do these things are handled differently," he explained as the reasoning for the Revenue Canada resolution.

Shareholders also voted on a new board of directors Thursday, renewing the positions of 10 while electing just one new member, Ray Flaten of Weyburn, who replaces John van Staveren.

The 11 elected members are: Al Brigden, Claude Carles , Ed Douglas, Trevor Dammann, Ken Fortner, Jeff Gaab, Harvey McEwan, Al Richards, Ken Newman, Jason Watson, and Ray Flaten.