West Coast ocean region a ‘severe’ concern ahead of potential rail strike

In anticipation of a potential rail strike, some third-party logistics companies have been diverting cargo away from Canadian ports.

C.H. Robinson, a transport and logistics company that offers freight transportation and warehousing services, has been advising some of its customers to avoid Canadian ports since May when CP Rail and CPKC union members cast their initial strike vote.

“Roughly 80 per cent of the customers who’ve switched are now exporting through L.A/Long Beach and the rest through Seattle/Tacoma,” said Scott Shannon, vice-president for Canada and cross-border logistics with C.H. Robinson. “Now that a strike notice has been declared, some of our Canadian export customers are starting to ship time-sensitive goods to the ports by truck to avoid containers being stuck at a rail terminal during a strike.”

ITS Logistics also released its August Port Rail Ramp Index saying that a Canadian rail strike would have an impact on West Coast and inland rail legs of ocean container traffic entering Canada.

“As a result, the West Coast ocean region has been categorized as a severe concern, and inland rail ramps are an elevated concern,” ITS’s report said.

Minister of Labour Steven MacKinnon also met separately with both parties in Calgary and conveyed a message encouraging each to reach a deal.

Shannon said a rail strike would be particularly disruptive at the Port of Vancouver, which has been taking measures to prepare for a rail worker stoppage.

“The rail ramps there have been almost continually congested since the summer of 2023,” said Shannon. “First it was the wildfires and a 13-day port strike, the harsh winter meant shorter trains and slower speeds, and then Chinese New Year brought a rush of orders. Vancouver just hasn’t been able to catch a break or catch up. Over 26,000 TEUs of cargo is already stacked up waiting to get on a train. That’s roughly 13,000 containers, and it would only get worse if the trains stop.”

CN Rail has formally issued notice to the Teamsters Canada Rail Conference (TCRC) advising them of its intention to lockout Canadian TCRC-represented employees Aug. 22 at 12:01 a.m. ET unless an agreement or binding arbitration is achieved before that time.

Despite negotiations over the weekend, CN said no meaningful progress has occurred, and the parties remain very far apart.

Unless there is an immediate and definite resolution to the labour conflict, CN said will have no choice but to continue the phased and progressive shutdown of its network which would culminate in a lockout.

TCRC said it received CN’s notice of the intention to lockout workers, issuing a statement condemning the railway’s demands.

“Despite reaping billions in profits over the years, CN is demanding concessions that would drag working conditions back to another era,” said Paul Boucher, president of TCRC. “They don’t care about supply chains, farmers, or small businesses—their sole focus is on padding the pockets of their managers and shareholders, with little regard for the safety or well-being of employees.”

TCRC said CN is demanding an extension to work days in provinces west of Ontario, creating a “fatigue-related safety risk.” The union said CN is also attempting to impose a forced relocation policy, which could see workers forced to move across the country, tearing families apart in the process.

TCRC served its own 72-hour strike notice to CPKC.

TCRC said CPKC has served notice it will be locking out our members as well as changing the terms of the collective agreements, stripping workers of those protections. This forces the union to serve strike notice to protect their members.

“We do not take this decision lightly, but CPKC’s reckless actions have forced our hand,” said Boucher. “By unilaterally locking out our members and changing the terms of the collective agreements, they are stripping our members of essential protections. We’re serving strike notice to defend the rights and safety of our members.”

The Teamsters said it remains committed to negotiating in good faith, and doing everything possible to achieve a fair and equitable agreement with the company.

Shannon said although the railroads would no longer move any goods in the event of a lockout, there would be one exception.

“The exception would be southbound rail freight that originated in Canada and had already crossed the U.S. border, because the trains swap from Canadian crews to U.S. crews at the border. Trains could keep going uninterrupted to destinations in the United States and Mexico,” he said. “Freight moving from Mexico to Canada, which is the case for a lot of auto parts, would not continue. Many of our automotive customers rely on the manufacturing centers in Mexico to serve their entire North American supply chain.  If a strike happens, cargo already en route to Canada would get held at the border or at a rail yard along the way.”