CP Rail work stoppage could hit product supply, prices: expert

As the CP Rail work stoppage enters its second day, there are concerns that the longer this goes on, the further we could see the supply chain stretched.

The labour dispute at CP Rail comes at a time when the COVID-19 pandemic and war in Ukraine are already causing issues.

According to an expert, a second week of this could start to affect the consumer, with higher prices and perhaps even issues around product availability.

Sylvain Charlebois, director of the Agri-Food Analytics Lab at Dalhousie University, says a range of products could be affected.

“By far, I mean, the entire planet cannot afford a … lengthy labour dispute at CP Rail, essentially. All eyes are on North America to deliver the goods this year as a result of the Ukrainian conflict,” he explained.

“We could see shortages for imported products. There’s, of course, the CP network that spans south as well. It does transport a lot of goods from the United States — processed foods, a tenth of the store products, essentially.”

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More than 3,000 CP Rail conductors, engineers, and train and yard workers represented by Teamsters Canada Rail Conference are off the job after a contract deadline passed.

Many groups, including the Canadian Chamber of Commerce, are calling for the federal government to step in with back-to-work legislation, highlighting the dire situation.

Charlebois says he doesn’t anticipate any noticeable issues on the supply chain front for the first week or so. However, after a week’s time, he says “there’s a bit of an unknown.”

“The CN strike in 2019 lasted eight days and we didn’t see a whole lot of changes. Same for the Port of Montreal in 2020. Let’s hope that this labour dispute doesn’t last beyond seven or eight days,” he explained.

He notes the trucking industry can take care of things like perishables. However, the BC Trucking Association has previously warned Canada can’t rely on truckers to transport more goods or fill any potential supply chain gap.

The trucking association has also said it’s still struggling to find drivers and equipment, after losing about 10 per cent of its workforce over the past two years.

‘Stakes are much higher this year’

Along with business groups, manufacturers, grain shippers, and farmers have also expressed concern, warning of potential wide-ranging impacts.

“We often think about our farmers, and we should, but farmers from outside of Canada actually rely on our own fertilizers to actually produce more. So stakes are much higher this year than passed years, for sure,” Charlebois told CityNews.

He admits he’s surprised the labour dispute has come to this point.

“I think all parties are aware of what’s at stake here. To basically decide to go into a lockout, it’s honestly damaging for Canada’s reputation,” Charlebois said, adding he’s heard from industry stakeholders who rely on CP transport about their concerns directly.

“Every three, four years, we’re seeing something like this affecting our ability to move products. So over the long term you’ll see more companies investing outside of Canada just because they can’t rely on a railway system or a logistical network that will continue to operate.”

Charlebois adds railways on this content are “the backbone” of the agriculture economy here, stressing the importance of a swift solution.

With so much on the line, he says it would be “absolutely irresponsible” for the federal government to sit by and not intervene, should a deal not be possible.

-With files from Lasia Kretzel