Canadian Pacific Rail Workers Strike Raises Fears of Supply Chain Problems for the US

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With Russia’s war on Ukraine still causing imbalances in the general global economy, another issue in the form of a massive labor strike has made its debut.

Canadian businesses and industry experts are urging Ottawa to resolve this issue since it poses a significant danger of food price inflation, supply chains, and the nation’s reputation as a dependable agricultural exporter to the US.

This widespread disarray broke out when the Canadian Teamsters and Canada Pacific Rail could not strike a deal by midnight. As a result, around 3,000 rail workers represented by Teamsters Canada Rail Conference laid down their tools and went on strike, leaving officials in dismay.

Both parties say they are conversing with federal negotiators, but with no developments so far. To know more about the above incident, kindly read on!

Cause of the Railway Strike

On Saturday night, a meeting took place between the two parties in Calgary. Now, there are two sides to what happened in this meeting. Let’s look at what the union has to say first.

According to the Teamsters Canada Rail Conference (TCRC), which represents around 3,000 locomotive engineers, conductors, yard workers, etc., accused CP rail of initiating a lockout during the weekend. That took place in spite of the fact that the union had a continued interest in bargaining.

It demonstrated irresponsibility in maintaining labor relations from the company’s side, sparking widespread hostility amongst the union.

On the other hand, the employer tells a different story. The deal was still on the table at the Saturday night meeting, according to the company. Moreover, it was the union that withdrew its service unilaterally before the deadline for a lockout or strike could even take place.

That was interpreted as the union’s inability to negotiate in good faith, gaslighting the entire situation.

Impact and Prognosis

With the onset of economic disruptions due to the pandemic, the extreme weather in Canada, and Russia’s war against Ukraine, the US is absolutely not prepared for another disturbance in the form of a labor dispute.

The US will face the brunt of this situation since Canada is its second-largest supplier of agricultural imports. Moreover, the world is in an agricultural deficit, and a robust logistical network is a must.

CP covers a large chunk of the US Midwest, earning the title of the largest supplier of potash and fertilizer for agriculture. Being responsible for 70% of the potash supply in North America, the company also transports essential fertilizers such as phosphate, ammonium nitrate, urea, ammonium sulfate, and anhydrous ammonia.

An interruption in the transport of agricultural products at this scale will hurt farmers, further aggravating the existing supply chain bottlenecks due to the pandemic.

The labor minister Seamus O’Regan urges both sides to keep bargaining, but no conclusion has been derived yet.