The nation's largest railroads reached a tentative agreement with their labor unions Thursday to avert a strike that could have crippled the nation's fragile supply chains heading into harvest.
In a statement, President Joe Biden called the deal "a win for tens of thousands of rail workers who worked tirelessly through the pandemic to ensure that America’s families and communities got deliveries of what have kept us going during these difficult years. These rail workers will get better pay, improved working conditions, and peace of mind around their health care costs: all hard-earned."
Friday was the end of a federal cooling off period and the deadline for getting an agreement. The Consumer Brands Association, whose member companies rely on rail shipments of ingredients, said Wednesday that the railroads were preparing to stop shipments of crops as early as Thursday.
Shipments of anhydrous ammonia had been halted on Monday, said Chris Glen, a spokesman for The Fertilizer Institute. The shipment embargoes were lifted Thursday, but there will likely "be some lag time as those delayed shipments move through the system and things ramp back up to full force again," he said.
The American Association of Railroads said the agreement would raise wages 24% by 2024 over 2020 and provide an immediate average payment of $11,000 per worker upon ratification of the agreements.
AAR described the deals as being in line with the recommendations of a presidential emergency board that had provided a similar pay increase but smaller bonus.
AAR praised Biden administration officials, including Labor Secretary Marty Walsh and Agriculture Secretary Tom Vilsack, for their assistance in resolving the labor impasse.
Biden said the labor agreement “means that our economy can avert the significant damage any shutdown would have brought. With unemployment still near record lows and signs of progress in lowering costs, tonight’s agreement allows us to continue to fight for long term economic growth that finally works for working families.”
The president was under heavy political pressure to head off a strike. Republicans tried unsuccessfully Wednesday afternoon to force a Senate vote on ratifying the board’s recommendations, but Sen. Bernie Sanders, I-Vt., blocked the move.
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The National Grain and Feed Association, which was already concerned about rail delays heading into harvest time, welcomed the tentative deal.
“The efficient operation of our rail network, which moves 25% of all U.S. grain, is crucial to a functioning agricultural economy. NGFA members, which include 1,000 companies that handle U.S. grains and oilseeds, commend both parties for working in good faith toward an agreement and preventing severe economic damage," said NGFA President and CEO Mike Seyfert.
Mike Steenhoek, executive director of the Soy Transportation Coalition, said a "strike, lockout, or significant slowdown would have imposed significant harm on agriculture – particularly on the eve of harvest. The tentative agreement allows farmers and U.S. agriculture to proceed with doing what they do best – being the highest quality, most reliable provider of food to the world."