How a rail strike could impact Canada’s agriculture industry

Manitoba’s agricultural industry is bracing for the worst, as Canada’s two main national railways are threatening to lock out employees if their labour negotiations aren’t resolved.

“We rely on both CPKC and CN and without rail, our product doesn’t move,” said Greg Northey, vice-president of corporate affairs at Pulse Canada.

Canadian National Railway Co. and Canadian Pacific Kansas City Ltd. have warned about a potential lockout, impacting around 9,300 workers beginning on August 22, unless new contracts for their employees come to fruition.

“Really, what we need to see happen is our reputation protected, internationally. We export to over 80 countries around the world — $68.8 billion industry and not being able to move this product will have repercussions across our supply chains,” said Mark Walker, the vice-president of Cereals Canada.

RELATED:

• Canadian Pacific CEO predicts rail strike in August
• CN Rail lowers 2024 earnings forecast due to strike uncertainty

“So we have stressed without partners and key stakeholders the importance of getting a deal done quickly and efficiently,” added Jill Verwey, the president of Keystone Agricultural Producers.

Carl Stewart from the Wheat Growers Association says he is frustrated about the frequency of situations like this, year in and year out. 

“You know, we don’t want to put the blame directly on one side or the other, we kind of feel that everybody has a part to play in improving this. We have worries of our own, we have got crops to put in, and mother nature to deal with. This isn’t something we are terribly excited to hear,” said Stewart.

Northey says 80-85 per cent of agriculture products get moved by rail, so a rail strike would be a catastrophe for farmers.

“Whether it’s a lockout or a strike, farmers pay the price and what they are going to be harvesting this month, across the country, by the way. This isn’t just a western thing, this is across Canada rail outage that would happen. It will be significant,” said Northey.

Dr. Barry Prentice says shippers are already preparing for alternative options, but in a lot of cases for railway shippers, he says, there aren’t a lot of good options.

“You can’t just put grain on a truck and ship it, and fertilizer would be a similar case, I believe. So, there aren’t that many options, but to a degree, it can be done. The railways are probably bleeding traffic already,” said Dr. Prentice.