Fertilizer Canada is calling on the federal government to take immediate action to mitigate impacts on the fertilizer supply chain from a work stoppage at Canadian Pacific Railway (CP Rail). A disruption to essential rail service during the crucial spring seeding season will have devastating effects on farmers, the economy, and domestic and international food security.
While Fertilizer Canada respects the collective bargaining process, we have reached a point where government must urgently act. Every day matters when it comes to government intervention to end the work stoppage.
Fertilizer is the most important input for crops and is responsible for half of the world’s current food production. Spring seeding is four to six weeks away in Canada and even sooner in the United States. Due to poor rail service leading into the spring season, Fertilizer Canada members are two to three weeks behind inventories, and storage capacity at fertilizer production facilities is lower than normal. There is a brief window when farmers fertilizer their crops and they are counting on a timely supply of fertilizer to maximize their yields.
“Canada cannot afford another disruption to our supply chain,” says Karen Proud, President and CEO of Fertilizer Canada. “75 per cent of all fertilizer in Canada is moved by rail. During the lead-up to spring seeding, every day, frankly every hour, counts. During this critical time our members rely on uninterrupted rail service to deliver their products to their farmer customers in Canada and into international markets.”
The agricultural sector is already experiencing supply challenges compounded by the war in Ukraine and cannot withstand anymore disruption. The 2021 growing season saw lower crop yields due to weather conditions. Food security in Canada and internationally depends on maximizing crops this season to make up for last year and fertilizer is critical to this.
Our members have said that they will be days away from curtailing production and shutting down facilities following a work stoppage, impacting Canadian workers, the economy, and food security. After a rail stoppage occurs it can take up to one month for services to return to full capacity.
The Canadian government needs to ensure that domestic supply of fertilizer is moving freely and there is unimpeded trade and cross-border mobility between Canada and the U.S. which is essential, particularly for the fertilizer sector, due to the highly integrated nature of the supply chains.
“A CP work stoppage will bring additional uncertainty to fertilizer markets in the U.S.,” says Corey Rosenbusch, The Fertilizer Institute President and CEO. “The U.S. receives 86% of our potash imports from Canada, much of it by rail. We are in full support of our Canadian partners in calling on the federal government to take immediate action.”
The federal government needs to develop long-term approaches and a regulatory environment that will ensure that Canada is a reliable trading partner. Since 2019, our members have dealt with work stoppages at Canadian National Railway, the Port of Montreal and now CP Rail. Our member companies operate in a global marketplace and need a transportation system that is not under threat of disruption every two years. There is no other alternative transportation method that currently has capacity or can be brought online in time to mitigate the impact of the work stoppage.
The work stoppage includes more than 3,000 Teamsters Canada Rail Conference (TCRC) union members who work as engineers, conductors, trainpersons, and yardpersons.