The Canadian Pacific Railway – a key transportation route for fertilizer delivery to the U.S., Brazil and elsewhere - has shut down amid stalled labor negotiations between the railroad and the Teamsters Rail Conference Canada union.

“The work stoppage has begun, but (Canadian Pacific) and Teamsters are still at the table with federal mediators,” Canadian Labor Minister Seamus O’Regan tweeted just after midnight Saturday. “Parties are working through the night. We are monitoring the situation closely and expect the parties to keep working until they reach an agreement.”

The Teamsters Rail Conference Canada (TRCC) and Canadian Pacific (CP) are blaming each other. The railway last Wednesday threatened to lock out employees one minute after midnight Saturday if an agreement on salaries and benefit demands from the union could not be reached.

The union, saying it was reacting to the lockout, declared early Sunday morning that railroad employees were on strike.

“Shortly before the lockout was announced, the Teamsters Union expressed its desire to continue bargaining. Unfortunately, the employer chose to put the Canadian supply chain and tens of thousands of jobs at risk,” the union said in a statement. “As Canadians grapple with a never-ending pandemic, exploding commodity prices and the war in Ukraine, the rail carrier is adding an unnecessary layer of insecurity, especially for those who depend on the rail network.”

On Sunday, CP placed blame on the union.

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“We are deeply disappointed that, in the final hours before a legal strike or lockout was to potentially occur, the TCRC Negotiating Committee failed to respond to the company’s latest offer that was presented to them by the federal mediators,” CP President and CEO Keith Creel said in a statement “Instead, the TCRC opted to withdraw their services before the deadline for a strike or lockout could legally take place. The TCRC is well aware of the damage this reckless action will cause to the Canadian supply chain.” 

The rail company accused the union of instigating the work stoppage while CP “remained waiting at the table with the desire to continue bargaining.”

Canada is the largest producer of potash in the world; companies like Nutrien and Mosaic depend on CP to deliver to American farmers and ocean-going ports that send the input around the globe.

“A rail disruption at a time when fertilizer supply chains are already stretched may have immediate and significant global consequences,” a Nutrien spokeswoman told Agri-Pulse last week. “Nutrien relies on rail transport to move fertilizer and retail products in Canada, to the U.S., and to export ports.”

Russia and Belarus are also major global potash suppliers to the world, but the countries are not exporting.

“As with all these things, the longer it lasts, the bigger an issue it is,” said Sam Taylor, a Rabobank farm inputs analyst. 

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