Canadian ministers meet with CN Rail, union in effort to avert strike

Canada's Liberal government sent two ministers on Monday to meet with representatives of Canadian National Railway and its largest union, as already hard-hit shippers pleaded for government intervention to avert a strike planned for early on Tuesday.

The threatened strike by 3,000 workers with Teamsters Canada comes after CN, the country's largest railroad operator, said on Friday it would cut management and union jobs, as it grapples with softer economic conditions.

Labour Minister Patty Hajdu and Transportation Minister Marc Garneau were to meet with representatives from CN and the union in Montreal, Hajdu's press secretary Veronique Simard said, following a stalemate in contract talks.

CN said it believes a strike can be averted "with the assistance of federal mediators," after Teamsters declined to submit to binding interest arbitration.

"We expect talks to continue up to Nov. 19," CN said.

Teamsters and CN reached a last-minute deal in 2017 that averted a planned strike. Canada, one of the world's biggest exporters of farm products, relies on its two main railways to move canola and wheat over the vast distances from western farms to ports. Crude oil shippers in Alberta have also used trains in the past two years to reach U.S. refineries as an alternative to congested pipelines.

Urging Ottawa to intervene

Alberta wheat and barley commissions, representing farmers, urged Ottawa to intervene, as they are already facing difficult harvest conditions because of weather. "There are a lot of farmers who already have a significant amount of their income trapped under snow," said Gary Stanford, Alberta Wheat Commission chair. "Now adding insult to injury, we're looking at possible CN rail strike action too."

CN was expecting slightly lower fourth-quarter crude shipments from the third quarter, officials said on an Oct. 22 conference call.

"The minute they start shutting down trains you start backing up the grain elevators and you start backing up stuff on the farm," Ward Toma, General Manager for Alberta Canola, said. "You start backing all that stuff up that not only affects farmers but canola crushers send oil via rail, and canola meal via rail to the United States you lose that ability, you start backing things up."

Toma says according to Alberta's last agriculture report, 20 per cent of the canola crop is still out in the fields. And he says this is the time of the year farmers look to sell and pay their bills by the end of the year.

"They're busy, they still haven't got the crop off and they are trying to move product."

Slumping commodity prices, congested oil pipelines and a dispute with China that has hampered Canadian agriculture exports have pressured the economies of resource-rich western provinces.

Teamsters Canada spokesman Christopher Monette said the planned strike by its conductors, train personnel and yard workers comes because workers are "hitting a wall on issues related to health and safety."

"While we continue to negotiate in good faith and in hopes of avoiding a labour dispute, we have every intention of striking at 12:01 a.m. ET tonight unless an agreement can be reached before then," Monette said by email.

CN shares were trading down 0.5 per centin early afternoon Toronto trading.