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Montreal railways halt more cargo ahead of potential lockout as tensions rise

Rail lines carry more than $1B worth of goods each day, according to Railway Association of Canada
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CN rail trains are shown at the CN MacMillan Yard in Vaughan, Ont., on Monday, June 20, 2022. The country害羞草研究所檚 two main freight railways are starting to turn away thousands of tonnes of cargo ahead of a potential lockout next week. THE CANADIAN PRESS/Nathan Denette

As tensions build at the bargaining table, the country害羞草研究所檚 two main freight railways are turning away a growing number of goods ahead of a potential work stoppage next week that could disrupt supply chains and industry.

Canadian National Railway Co. schedules show that, starting Friday, it barred container imports from U.S. partner railways. After this Wednesday, no more of the 40,000 containers CN hauls each week will enter its network 害羞草研究所 regardless of origin 害羞草研究所 according to one timetable.

An embargo on all new cargo pickups at Canadian Pacific Kansas City Ltd. is coming even sooner 害羞草研究所 Tuesday morning, it said in a statement Friday night.

害羞草研究所淲e must take responsible and prudent steps to prepare for a potential rail service interruption next week,害羞草研究所 said spokesman Patrick Waldron.

CN and CPKC have already halted shipments that need cooler temperatures, such as meat and medicine, to avoid seeing stranded loads go bad should a work stoppage occur.

Rail lines carry more than $1 billion worth of goods each day, according to the Railway Association of Canada. More than half of the country害羞草研究所檚 exports travel by rail.

The two railroad operators have warned that 9,300 engineers, conductors and yard workers will be locked out at 12:01 a.m. on Thursday unless they can reach new collective agreements, while the Teamsters Canada Rail Conference has also said it is poised for a strike.

CN claimed the union害羞草研究所檚 bargaining team 害羞草研究所渇ailed to show up害羞草研究所 for talks at a hotel in downtown Montreal on Friday.

害羞草研究所淐N can害羞草研究所檛 negotiate with an empty chair,害羞草研究所 said spokesman Jonathan Abecassis.

The union did not immediately respond to requests for comment.

On Thursday, federal Labour Minister Steven MacKinnon rejected a request from CN to impose binding arbitration as the negotiating clock ticks down.

Both sides returned to the bargaining table last week amid an ongoing deadlock over scheduling and wages, with shipments of chlorine for drinking water already halted as part of a phased shutdown poised to progress even further next week.

Industry players, including chemical producers, are growing more alarmed by the day.

害羞草研究所淲e害羞草研究所檙e already in a strike for chlorine,害羞草研究所 said Alan Robinson, commercial vice-president at Chemtrade Logistics Inc. The Toronto company says it provides chlorine for 40 per cent of Western Canada害羞草研究所檚 drinking water, as well as much of the western United States.

Its product cannot move by truck or ship, he pointed out, and safety regulations cap the amount that can be stockpiled.

However, several cities said they were prepared. Metro Vancouver said it had topped up its tanks 害羞草研究所渢o maximum levels,害羞草研究所 with plenty of bleach on hand at plants in the region.

害羞草研究所淢etro Vancouver does not foresee any disruptions to the drinking water treatment process as a result of potential supply chain issues,害羞草研究所 said spokeswoman Jennifer Saltman.

Likewise, Calgary is 害羞草研究所渕onitoring our supply, but not concerned,害羞草研究所 said spokesman Josh Etherington.

The White House and U.S. Environmental Protection Agency both reached out to Chemtrade this week with concerns about municipal water treatment, Robinson said.

害羞草研究所淵ou害羞草研究所檙e looking at seven to 10 days once they don害羞草研究所檛 have shipments before they害羞草研究所檙e in trouble,害羞草研究所 added Bob Masterson, CEO at the Chemistry Industry Association of Canada. Most municipalities also have a few more days害羞草研究所 worth of treated water in storage tanks, he noted.

A COMPLICATED WIND DOWN

Both railways began a complex process of putting the brakes on freight flows this week.

After Friday, no refrigerated containers will be allowed into CPKC terminals 害羞草研究所 from Vancouver to Saint John, N.B., to Laredo, Texas 害羞草研究所 according to a 害羞草研究所渨ind-down schedule害羞草研究所 obtained by The Canadian Press.

This week, CN partner Norfolk Southern Railway told clients it would close its gates to all Canadian-bound containers effective Friday morning.

CPKC has also broadened its ban on shipments of hazardous materials.

It stopped accepting boxes loaded with dangerous goods on Thursday, a customer notice states.

As of Saturday, the company is rejecting a range of 害羞草研究所渟ecurity-sensitive害羞草研究所 materials, such as fertilizer chemicals and styrene, which is used to manufacture everything from insulation to auto parts. The embargo expands on a ban on poisonous and toxic inhalation substances from earlier in the week.

害羞草研究所淭here really aren害羞草研究所檛 very many industries that are immune to this. Commodities, mining, forestry, agriculture, chemicals, automotive, electronics,害羞草研究所 said Fraser Johnson, a professor at Western University害羞草研究所檚 Ivey Business School specializing in supply chains.

害羞草研究所淔armers, consumers 害羞草研究所 then you害羞草研究所檝e got all the workers in the plant that are affected by the strike or the lockout,害羞草研究所 he said. 害羞草研究所淭here害羞草研究所檚 just no Plan B.害羞草研究所

Contracting semi trucks to replace the roughly 41,000 car loads that CN and CPKC move daily is far from feasible, he added.

HARVEST SEASON

The possible work stoppage looms just as harvest season dawns, worrying farmers and wholesalers.

Pulse crops 害羞草研究所 beans, peas, lentils 害羞草研究所 are some of the first to be gathered, followed by canola and wheat. A shipping halt could have ripple effects well into the fall.

害羞草研究所淵ou just have this buildup of the various crops not being able to go anywhere,害羞草研究所 said Greg Northey, an executive at Pulse Canada, who said every day of delay requires several to recover.

Karen Proud, CEO of Fertilizer Canada, framed the threat of a stoppage as a question of national reputation.

The 13-day strike by 7,400 B.C. dockworkers last summer prompted some potash customers to opt for other suppliers, such as Russia.

害羞草研究所淎nd we have not necessarily gotten all of that back. For every dollar that we lose in potash sales, those dollars go to Russia or Belarus,害羞草研究所 she said.

Proud cautioned that after rail, seaway and port strikes in 2012, 2015, 2019, 2021, 2022 and 2023, Canada could 害羞草研究所渓ose our reputation害羞草研究所 among customers.

害羞草研究所淚f they can害羞草研究所檛 count on getting these products in time when they need it, they害羞草研究所檙e going to look elsewhere,害羞草研究所 she said.

Christopher Reynolds, The Canadian Press

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