Vaccine mandates seen as a driver behind rising cross-border trucking rates and increased rail inquiries

(Kara Oosterhuis/RealAgriculture)

Looming vaccination mandates that are set to apply to truckers crossing the Canada-U.S. border in January are already affecting cross-border supply chains, according to several speakers at the annual Fields on Wheels Conference hosted by the University of Manitoba.

The Canadian government says it will require all truckers entering the country to be vaccinated by January 15, while the U.S. has announced a vaccination requirement for Canadian truckers as of January 22.

Canadian trucking industry groups say they’re expecting to lose tens of thousands of drivers if the mandates are not delayed or changed. The Canadian Trucking Alliance estimates up to 22,000, or around 20 per cent of Canadian truckers, will leave the Canada-U.S. supply chain, while the Private Motor Truck Council of Canada says a survey of its members shows 31,000 drivers — about a third — in cross-border fleets are not fully vaccinated.

As supply chains grapple with understanding the impact of the border mandates, there are already signs trucking rates for loads crossing the border, which were already high, are starting to reflect the anticipated shortage of drivers, said Diane Gray, president and CEO of the CentrePort inland port in Winnipeg, Man.

“They’re already seeing rates going up, and I think that is going to be one of the near-term implications, because there isn’t going to be the same number of drivers that are willing or going to go south, or come north,” she said, speaking during the U of M’s transportation conference on Tuesday.

“I also think it presents a greater opportunity for rail, so you may see some modal shifts, and potentially more delays,” noted Gray. “It’s not good.”

Several trucking companies contacted by RealAgriculture echo Gray’s comments, in that they’re either seeing cross-border rates increase, or anticipating they will rise due to reduced availability of drivers able to cross the border without being required to quarantine for 14 days.

One trucking company general manager said they anticipate having enough vaccinated drivers to sustain movement of cattle south, but they expect other commodities, such as fresh produce from California and fuel exports to the U.S., to see the initial supply chain disruptions. They also noted domestic freight rates may drop as more drivers stay in Canada.

CP Rail, meanwhile, is already seeing more inquiries about the price of moving products, including feedgrains, across the border by train rather than truck.

“We’ve seen a lot more rate requests come in for cross-border traffic,” said CP’s managing director for grain and fertilizer, Jon Harman, who spoke on a panel alongside Gray at the U of M conference Tuesday.

“One of the issues we have is a lot of the ultimate destinations for let’s say feed products going north into Manitoba, the destinations are not necessarily rail served,” said Harman. “So we’re trying to connect origins with rail-served destinations and working out trucking options to get them to their final destinations.”

Trucking industry groups are lobbying the Canadian government to delay the January 15 mandate, or provide exemptions for truck drivers.

Ottawa has also said it plans to impose a vaccination mandate on all federally-regulated workplaces in early 2022, potentially impacting domestic truckers who do not enter the U.S.