'Now is not the time': 2 day old CP Rail work stoppage already hurting Canadian economy

Canada’s labour minister is in Calgary where CP Rail and the teamsters union are in negotiation while a work stoppage shuts down much of the rail traffic across Canada.

"I choose to be optimistic," said Seamus O’Regan. "They are at the table. In fact, they've never left. I know that there's been some ups and downs, there always is. But I’ve got to applaud (them because) they never left the table."

The work stoppage comes at a time when Canada's economy is struggling to recover from two years of a pandemic, and is experiencing near-record inflation.

"Eight billion dollars a year (moves on CPRail)," said Rajbir Bhatti, professor in the department of Supply Chain Management at Mount Royal University.  "$1.6 billion worth of freight revenue for CP comes from the commodity sector, the bulk sector accounts for another $1.6 billion. And another 20 per cent is the petroleum products,"

"If they don't resolve it in the next couple of hours," he added, "the bleeding that is happening within the supply chain sector will spill into the gas pump prices, shop prices, products on the shelves, so by the weekend, we will see that.”

AGRICULTURE HIT HARD

Particularly hard-hit are those in the agriculture sector.

Seamus O'Regan, the federal minister of labour, in Calgary Monday March 21, 2022

A drought last year forced many ranchers to begin purchasing grain and cord from U.S. suppliers. They count on rail lines to deliver the feed.

"There's just not trucks enough in the world to haul all we need." said Bob Lowe, president of the Canadian Cattlemen’s Association. "People ask about ‘Plan B’. There isn't one, because we didn't grow anything (last season). So we need this corn. We've got about maybe a two week carryover or two weeks surplus, but that's it, which, as we know, doesn't last very long.

"If these trains don't come in nine to 10 to 11 unit trains a week," he added, "if that doesn't happen for a couple of weeks, we're in a very, very serious animal welfare issue."

TIGHT SCHEDULE FOR GRAIN FARMERS

Grain famers face an even tighter deadlines to receive shipments normally arriving by rail. Spring seeding is about to begin and fertilizer, already in short supply due to the war in Ukraine, is now stalled by the labour dispute.

"It's already too late. We are in the most important time of year for farmers to get their fertilizer as soon as a work stoppage or strike is announced, the system starts to slow down. And so we need to make sure that our farmers have access to the fertilizer we need," said Karen Proud, President of Fertilizer Canada. "We need the government to act immediately to bring the rail cars back online. We know they like to wait to see if the parties will come to an agreement. But clearly that is just not happening. So they need to step in now."

Alberta Beef Producers (ABP) added their voice to those calling for a legislated end to the dispute. In a statement Monday it called on provincial legislators to demand Ottawa take action to get CP Rail's trains back on track.

"The countdown is on as producers are unable to bring in feed and begin to deplete stored feed. We are less than two weeks away from not being able to feed our animals," wrote Melanie Wowk, ABP chair, in the statement.

Despite the potential economic fallout, O'Regan said it was too early to consider back-to-work legislation.

"In effect what that means is you’re taking away the rights of workers,” the federal Labour Minister said. “The courts basically say, look, you’ve got to show that there are immediate consequences, that there are prolonged consequences, that it goes against the national interest, and that the parties aren’t at the table doing what they need to do to get a deal. That is not the case here—they haven’t left the table."

O’Regan said he’s not leaving Calgary until a deal is reached.

"I am here in Calgary basically to remind them as well, I think, of the best interest of Canadians, which is we want a deal now—this cannot be prolonged,” O'Regan said. "We’ve a saying in Newfoundland, ‘My nerves are rubbed raw.’ And I think considering everything that Canadians have been through over the past couple of years, their nerves are rubbed raw. This is not the time."