Looming U.S. rail strike would wreak havoc on the Canadian logistics system

Several American railroad worker unions are holding firm on contract demands, increasing the likelihood of a strike some time in early December.

While an official strike date of December 9 has been reported, the American Association of Railroads says that logistic adjustments and slow downs would begin as much as a week prior, as some cargo, such as hazardous materials, would stop being loaded so as to avoid it being stranded during a strike.

It’s estimated that a U.S. strike would cost the economy $2 billion per day — and that’s just for the U.S. Canada’s logistics system — both movement south and north — is fully integrated in to the U.S. rail network.

“Both [our] major [railway] carriers have extensive networks in the U.S. as well,” says Greg Northey, vice president, corporate affairs for Pulse Canada, a member of the Ag Transport Coalition. “We (Canada) do send a lot of product down there. And so if they were to go on strike, all that would be impacted. A lot of movement would get bottled up here in Canada, and then the concern, obviously, is all that movement that usually would be going to Canada then creates congestion in our own networks, and so impact can be quite large.”

Northey says that Canada sent close to 2 million tonnes of grain down to the U.S., and another 100,000 tonnes to Mexico in the first quarter alone. Last year, about 1.5 million tonnes of canola oil went south.

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