16 May 2007
CP Rail Strike Slowing Traffic
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Canadian Pacific Railway locomotives work in the Calgary
yard.
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Train traffic across Canada stayed on track Wednesday after 1,200
Canadian Pacific Railway maintenance workers walked off the job, the company said, but shippers voiced concerns a prolonged strike
could derail their businesses.
CP Rail said the strike, which began across the country Wednesday morning, was not disrupting its tightly scheduled freight runs
despite pickets delaying trucks coming on sites in Vancouver and Toronto. "By slowing traffic by 10 minutes, it's not going to
impact train service," CP Rail spokesman Mark Seland said.
Delivery of intermodal containers represented 28 percent, $311.6 million, of CP Rail's freight revenues during the first quarter.
The company, Canada's second largest railway, said there were no further talks scheduled with the Teamsters'
Maintenance-of-Way division.
Meantime, shippers raised concerns about the impact a second railway strike in four months would have on their bottom line.
"We could probably go for a few days, if there were service delays and disruptions," Maureen Fitzhenry, with the Canadian
Wheat Board said. "But when we start getting into a week or more, that's when things start getting unsustainable."
CP Rail has contracts to move more than two million tonnes of wheat, barley and other grains from the three prairie provinces before
the end of the crop year 31 Jul 2007, she said.
The board lobbied for government intervention in April when Canadian National Railway conductors and yard workers resumed a strike that
had lasted two weeks in February.
Union workers staged rotating walkouts in April after rejecting a proposed one-year contract. Within days Ottawa imposed
back-to-work legislation, saying continued work action could impact the country's economy.
Federal Labour Minister Jean-Pierre Blackburn said the government would not be getting involved in the CP Rail dispute at
this stage.
"Right now, our mediator is talking separately with the parties," Blackburn told reporters in Ottawa. "But the parties
will have to get to the point to sit at the same table to find a solution."
The 15-day CN strike in February caused bottlenecks at major ports on both coasts, and backlogs of product shippers
continue to grapple with.
Another work stoppage could harm Canada's reputation as a reliable source of goods, transport export Bill Waters said from Vancouver.
"These things always ultimately have a net cost," Waters said.
While industry complained about backlogs due to the CN Rail strike, economists were surprised at the relatively small impact it had on
the overall economy.
Avery Shenfeld of CIBC World Markets said a short strike at CP Rail probably would have the same minimal effect.
But he said, "if we start to hit deadlines for getting the goods moving again, we would look for Ottawa to step in and bring an
end to the strike."
CP Rail and the Teamsters reached a stalemate last week after months of contract negotiations fell off the table.
The union, which represents a total of 3,200 maintenance workers, asked for a 13 percent pay raise over four years against CP Rail's
offer of 10 percent over the same period.
While a short strike may have minimal financial impact, there are concerns safety of the railway network could be compromised if work
stoppages were prolonged.
Federal Transport Minister Lawrence Cannon said the department has been in close contact with the railway to ensure safety concerns are
dealt with promptly.
"Of course it falls under the purview of my colleague the minister of labour, but from the safety perspective, we'll be watching
this very closely," he said in Ottawa.
CP said it had been training management to take over maintenance-of-way duties prior to the walk out.
Fording Canadian Coal Trust, which ships the bulk of its coal on CP Rail, would not speculate on the impact of a prolonged strike,
saying the company is monitoring the situation closely.
"Canadian Pacific Railway has assured us that it will work to minimize the impact on its ability to transport our product to the
west coast ports," said spokeswoman Catherine Hart. "We believe this is acceptable."
Potash Corp. of Saskatchewan, one of the world's largest fertilizer enterprises by capacity, ships, also has been reassured by the
railway shipments will be maintained during the strike, spokeswoman Rhonda Spiess said.
The company shipped about half of its seven million tonne-production of potassium chloride on CP Rail last year, she said.
"Rail service is important to us as most of our product deliveries do require rail movement," Spiess said.
Sulpher and fertilizer shipments represent the third largest commodity group shipped by CP Rail, after grain and
coal.
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