On August 21st, Finance Associated Press (Editor Maran) reported that Canada's two largest railway companies have warned that if they cannot reach an agreement with more than 9,000 union workers, their railway network will stop operating on Thursday, which will affect 80% of Canada's railway transportation.

In addition to being a key channel for domestic freight, the Canadian railroad is also an important link in the interconnected North American market. Some of the largest US agricultural trade groups are urging Canadian Prime Minister Trudeau to intervene to avoid a strike.

35 US industry groups wrote to Trudeau calling on him to take action to ensure that Canadian railroads continue to operate and prevent serious damage to the Canadian and US economies.

The letter pointed out that the US agricultural industry ships more than 0.025 million carloads of goods each week through the Canadian National Railway Company and the Canadian Pacific Railway in Kansas City. Once a strike occurs, this number will plummet to zero.

It also stated that because farmers rely on railroads to transport fertilizers, agrichemicals, and livestock feedgrains in a timely manner, agriculture is particularly susceptible to rail disruption. Biofuel operations, flour mills, and other agricultural businesses also require uninterrupted railroad service.

Double strike risk

US trade groups emphasized that railroad operations on both sides of the US-Canada border are critical to the integrated supply chain in North America. Although they believe that negotiations are the preferred solution to the problem, if the two sides cannot reach a consensus, the Canadian government needs to be prepared and take action quickly.

Canadian companies also warned that if railroad and port strikes continue and block important trade arteries in Canada, it may cause long-term damage to the Canadian economy.

In addition to the railroad, Vancouver Port, the busiest port in Canada, is also facing union strikes and is waiting for a vote from Local 514 of the International Longshore and Warehouse Union.

Canadian companies said that they have not yet recovered from the 13-day strike by international dock workers a year ago, which affected $8 billion in trade. The Canadian Department of Transportation also said that the strike reduced Canada's GDP by $0.98 billion.

Jonathan White, Vice President of Business for Canadian Shipping Company, said that as a new round of strikes approaches, shipping delays and disturbances are once again affected. The company transports millions of tons of dry bulk cargo each year, including iron ore, grain, cement, and salt.

Port spokesperson Alex Munro further pointed out that ships currently heading to the Port of Vancouver have been told to slow down and delay their arrival to prevent further congestion. Grain, potash, coal, and other goods are all affected. He also warned that there is a strong interdependence between the port and railroad transportation. Even if the port does not strike, the shutdown of railways will significantly reduce port traffic, as about two-thirds of its traffic is transported by rail.