Supply chain under pressure as blockades continue

by John G. Smith

TORONTO, Ont. – An ongoing shutdown of CN’s rail network in eastern Canada is being felt throughout the broader supply chain, as protesters continue to show solidarity in the fight against a planned gas pipeline that would cross Wet’suwet’en territory in northern B.C.

“Many trucking movements begin or end at the rail head. The supply chain is not only integrated from a supplier perspective, it’s integrated modally as well,” the Canadian Trucking Alliance (CTA) said in a formal statement released today.

“When the railways suffer disruption in service, it impacts everyone in the economy including the trucking industry. When bridges and roads are blocked, trade stops and other modes and business sectors which depend on trucking services are negatively impacted. The Canadian economy overall depends on a reliable and fully-functioning supply chain.”

While the biggest disruption can be traced to a rail blockade at Tyendinaga Mohawk Territory near Belleville, Ont., bridges have also been a target. Yesterday afternoon, protesters formed a three-hour blockade of the Thousand Islands Bridge, which links Ontario and New York State. Another march blocked traffic at the Rainbow Bridge in Niagara Falls on Sunday, although that span is not used by commercial traffic.

The CTA is supporting a federal position that the blockades need to end “peacefully and quickly”, noting that freedom of expression – while an important right – must respect court decisions and the law.

CN announced its shutdown of Eastern Canadian operations on Feb. 13, citing the blockades.

A court order against the Ontario protest has yet to be enforced, although blockades have come to an end in Manitoba and B.C.

“This situation is regrettable for its impact on the economy and on our railroaders as these protests are unrelated to CN’s activities and beyond our control,” CN president and CEO JJ Ruest said when announcing the shutdown, noting that more than 400 trains were canceled in the previous week.

Quebec Trucking Association CEO Marc Cadieux says that his members have yet to make any urgent requests for help, but that bottlenecks can have a domino effect throughout the supply chain.

Some shippers have already shifted selected loads from railways to trucks, he added, noting that his association members are available to meet urgent transportation needs for essential goods such as pharmaceutical products, medical equipment, perishable food, chlorine and natural gas.

The trucking associations add their voices to several other business groups.

“At the ports, we are beginning to see instances where Canadian Port Authorities are turning away ships, and cargo is beginning to be rerouted to ports in the United States. In other instances, shippers are looking at alternatives to move cargo, including the use of trucks. When you consider that a single rail car carries the equivalent of about three transport trucks, an extended disruption of rail traffic will have a major impact there as well, said Wendy Zatylny, president of Canadian Port Authorities.

“In addition to preventing access to public transportation for tens of thousands of individual Canadians, these disruptions severely limit the movement of perishable foods and other consumer items, grain, construction materials, and propane for Quebec and Atlantic Canada,” said Perrin Beatty, president and CEO of the Canadian Chamber of Commerce.

“These illegal blockades, which also affect the movement of natural resources like timber, aluminum, coal and oil, will take an increasing toll if the government does not act decisively to restore order. Factories and mines may soon face difficult decisions about their ability to continue operations.”

The Forest Products Association of Canada (FPAC) also noted that the blockades add to other supply chain challenges, including reduced train speeds following a recent derailment, the coronavirus’ impact on shipping, a winter storm at the Port of Vancouver, and rockslides along rail lines in B.C.

“FPAC is increasingly concerned about the devastating economic impact these disruptions rae having on the forest products sector,” said Derek Nighbor, CEO.

The forestry sector represents 10% of the tonnage on Canadian railways.



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