Domestic Market Updates –
Canada Labor Uncertainty:
TCRC union officially issued their strike notice to CPKC and will walk out starting just after midnight on Thursday August 22nd, unless a contract agreement is reached. Additionally, CN Railway issued their official lockout notice. These official 72-hour notices are mandatory under Canadian law.
In preparation for this worker stoppage, Canadian National (CN) and Canadian Pacific Kansas City (CPKC) railways issued freight embargoes, in an effort to plan for the challenges that come with work stoppage.
According to the railway, some of the embargoes include shipments of hazardous/dangerous goods (as of August 19th), all shipments originating in Canada, all shipments originating in the U.S. destined to Canada, and all carload traffic destined to Canadian interchange (August 20th).
What, if any, impacts could this have? Our team believes it really depends on how long the work stoppage lasts. If work stoppage lasts a while (i.e.. 2-3+ weeks), there might be more heightened concern versus just a few days of work stoppage.
Diesel Update: This week the average price of diesel dipped 1.6 cents to $3.688 a gallon, per the U.S. EIA.
Intermodal: Following along in CN, CSX, and UP railways footsteps, NS will mandate a reservation systems, making trucking companies having to reserve slots when dropping off both international and domestic containers, JOC reports. This is set to begin in phases starting September 4th. NS hope this will help improve terminal efficiency, but certainly may have its challenges.
U.S. Labor Uncertainty: The East/Gulf Coast Dockworker contract expires on September 30th and recently the International Longshoremen’s Association announced they will present their final contract demands to union delegates at a meeting September 4-5th and will also outline strike strategies if an agreement is not reached before the contract expires. A couple key issues in these negotiations are wage increases and automation issues.
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