CN Rail Strike Halts Canadian Supply Chains

In-principle agreement ends strike, but residual delays remain

The Canadian National Railway Company (CN Rail) strike proceeded from November 19 to 27 when an in-principle agreement was reached. Effects from the strike continue to disrupt supply chains in rail-dependent industries across Canada. Assuming that the in-principle agreement holds, operations will resume at 06:00 local time on November 27, but significant disruptions are anticipated to persist as backlogs are cleared. 60% of Canadian rail capacity has been compromised with the timely delivery of goods at intermodal sea and ground transportation facilities in the Atlantic, Pacific and Great Lakes, disrupted. For production, immediate impacts are largely determined by dependency on rail transportation for inbound or outbound products.

Lumber, minerals, agricultural products, chemicals, and oil are heavily reliant on rail transport. Some plants began halting production before the strike began on November 19. A failure to resolve the strike would have intensified production impacts and posed expiration risks for perishable goods. Propane and automotive parts shipments have viable ground transportation alternatives, but these alternatives are less efficient and limited in on-demand capacity. The strike has threatened propane supply for agricultural production in Quebec and parts of Ontario, and complicated automotive assembly throughout the Detroit-Toronto corridor. By November 23, the strike had already cost the Canadian economy an estimated CAD 800-1,100 million (EUR 603-827 million; USD 546-750 million). Find out more about how your supply chain may be affected in our report.

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