CP Railway strike would be ‘devastating’ for producers, farming groups say

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Westman farmers and members from Manitoba’s agricultural sector fear a potential Canadian Pacific Railway strike could make life devastating for producers looking to transport their crops in an increasingly difficult marketplace.

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Hey there, time traveller!
This article was published 15/03/2022 (197 days ago), so information in it may no longer be current.

Westman farmers and members from Manitoba’s agricultural sector fear a potential Canadian Pacific Railway strike could make life devastating for producers looking to transport their crops in an increasingly difficult marketplace.

The sector is already facing numerous obstacles, said Brenna Mahoney, general manager of Keystone Agricultural Producers.

“There’s been excessive strains on our supply chain due to COVID-19, a shortage of truckers, forest fires, blockades, record snowfalls and floods,” Mahoney said.

File In this file photo, workers clear snow from the switches at the CP Rail yard in Brandon.

“There is currently a backlog of grain on farm that was expected to have been delivered to export customers. Having anything like a work stoppage would impact an already impacted system further.”

As of March 4, the Teamsters Canada Rail Conference, representing more than 3,000 locomotive engineers, conductors, trainpersons and yardpersons at Canadian Pacific (CP) Railway, tallied the results of a strike vote. Out of 3,062 ballots sent out to membership, 96.7 per cent voted in favour of a strike action, with their main issues concerning wages, benefits and pensions.

The Sun contacted the union for comment on Tuesday but didn’t receive a response by press time.

Quintin Pearce, general manger of P. Quintaine & Son Livestock Dealers based in Brandon, said there will be trickle-down effects for producers and consumers in western Manitoba should CP Railway employees strike.

Farmers are trying to make use of selling their grain based on favourable conditions for commodities on the futures market, Pearce said.

With spring feeding on the way, producers will be relying on commodities that are transported primarily via railcars.

Pearce said a secondary option of moving to truck transportation with the price of diesel circulating around $2 a litre would bear extra cost in part for producers.

“If these things need to move to truck transport, that will be disastrous, because Canada is facing a massive shortage of truck drivers,” Pearce said.

“If you put that much more freight on trucks, you’ve got a huge problem. You’ll see a backlog in getting fertilizer, seed, supplies, you name it. The cost will go up significantly because freight on trains is a lot more efficient than freight on trucks.”

Mahoney noted there is currently a shortage of dry distiller grain, soybean meal, fertilizer and feed that are urgently needed after coming through a significant drought in much of Western Canada the last growing season. She is concerned for farmers across the province ahead of spring fertilization based on CP Rail’s role in making sure the resource gets to farmers’ fields.

“CP plays a major part of this operation and distribution that is supposed to happen in March and April,” Mahoney said.

“If we don’t get the fertilizer required right now, that will be devastating for producers.”

Much like Pearce, she said Manitoba farmers are having to work against these challenges in getting that crop to market to make use of favourable conditions on the futures market.

“They need cash flow to run their business and to plant for the 2022 crop. If they can’t sell it because there is a current backlog, that will impact them.”

For the consumer, Pearce is concerned people will have to fare even greater inflation should a work stoppage commence at CP Rail. Based on high market prices factoring in the previous drought, and the war in Ukraine, he said there is a pressure on Canada as a net exporter of grain in the global market, even though the uncertainty of war may be half a world away.

“If Europe wants it, and we want it both, we’re going to be competing with the rest of the world to make that loaf of bread,” Pearce said.

“Farmers can sell all they want to, but they have to get it to the market, a good high price will be eroded by trucking it on the Trans-Canada Highway versus putting it on a grain car where it should be.”

For Manitoba Beef Producers, the greatest problem a potential strike would bring is a disruption of feed shipments.

President Tyler Fulton said that after last year’s drought conditions, shipments of grain from outside of Manitoba are needed to feed livestock.

“The drought left us with such short supply of feed all across the Prairies that all the Prairie provinces have been bringing in feed from the United States, largely corn and a product called dried distillers grains. It’s a byproduct of ethanol production. It’s a major concern … that there could be a stoppage. With all the other trucking-related issues and COVID delays and, of course, the weather that we’ve had, nobody is sitting on a lot of inventory of feed.”

While increased precipitation over the winter has brought some hope for this year’s growing season, any feed grown as a result of improved conditions is still months away from being usable.

According to Fulton, the Canadian Cattleman’s Association — of which he is a member — has reached out to both CP Rail and the union representing workers to express their concerns.

“We’re definitely advocates for getting a quick resolution and if not, moving directly to binding arbitration so that there’s not long stoppages so that we can avoid any animal welfare situation,” he said.

A CP Rail spokesperson said in a statement the company is focused on arriving at a negotiated outcome that is in the best interests of employees and their families, customers, shareholders and the overall Canadian economy.

The company said a work stoppage of any duration at CP Rail will impact virtually all commodities within the Canadian supply chain, thereby harming the performance of Canada’s trade-dependent economy.

“The consequences of a work stoppage will be felt long after workers return to work and service resumes. This is an issue of doing what is best for Canada’s economy. The timing could not be worse.”

Mahoney said Keystone Agricultural Producers is asking for steps to be taken to avoid a work stoppage at CP because of the financial impact that would resonate on Canada’s farming sector. She would like to avoid the impacts of the last CP strike which occurred in 2018.

While Pearce said the grievances of each CP employee affected should be considered, everyone involved in a potential strike with the company should consider a bigger picture of the economic state of the agricultural industry.

“Is this the right time, to put the hurt on the consumers?” Pearce said.

“People are just trying to live.”

— with files from Colin Slark

» jbernacki@brandonsun.com

» Twitter: @JosephBernacki

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