Canadian Railways are about to go on strike! Urgent warning from shipping companies! North American supply chain is facing serious threats!
Recently, Canada is facing a serious threat of a strike by railway workers, which may cause local freight transportation to come to a standstill.
According to foreign media reports, Canada's two major freight railway companies are expected to go on strike starting this Thursday. Although employers and employees held negotiations over the weekend, no substantial progress was made. The differences between the two sides remain very wide and they failed to reach any consensus on a labor agreement.
Canadian National Railway Corporation(CN) officially notified the Canadian Teamsters union on Sunday that it will begin suspending union workers early Thursday. CN said in a statement: "Unless the differences between labor and management are resolved immediately and clearly, CN will have no choice but to continue the gradual shutdown of its operating network, eventually leading to a complete shutdown.
Canada's other major rail operator-- Canadian Pacific Kansas City Railway Co. (CPKC) has given advance notice to the Teamsters union that it will begin suspending union members early Thursday.
The Teamsters union also gave CPKC a 72-hour strike notice late Sunday. The union said in a statement: "Unless the parties reach an agreement within the final time, the work stoppage will take place at 00:01 am on Thursday, August 22."
CPKC said it will stop all shipments of goods from Canada and all shipments of goods from the United States to Canada. At the same time, CN has banned the receipt of imported containers from US cooperative railway companies.
The labor agreements of both railway companies are inIt expires at the end of 2023, and negotiations have continued since then.
Shipping giant Hapag-Lloyd issued a reminder on its official website about the Canadian railway strike. Hapag-Lloyd said the closure of the rail network could disrupt the movement of goods and impact industries that rely on rail supply chains, potentially affecting some regions in Canada and the United States.
The strike is expected to be just the beginning of threats to North American supply chains in the coming months, with U.S. East Coast and Gulf Coast longshoremenStrike action is also possible on October 1, which would pose a greater threat to the supply chain.
Shipping analysts say potential strikes at U.S. East Coast and Gulf of Mexico ports could strand cargo there for weeks or even months. .
It is understood that retailers such as Walmart and other importers have been rushing toShip the goods into the United States before the union contract expires on September 30.
Analysts at Sea-Intelligence estimate it could take four to six days to clear the cargo backlog created by the one-day strike. Sea-Inteligence chief executive Alan Murphy said a two-week strike could mean the port would not resume normal operations until 2025. Shipping giant Maersk has also said that a one-week shutdown could take up to six weeks to recover.
This also imposes high costs on cargo owners.Peter Sand, chief analyst at Xeneta, said: “Spot market prices for 40-foot containers from the Far East to the US East Coast exceeded ,000 in early July.
According to the latest shipping report released by the Shanghai Shipping Exchange, the latest Shanghai export container comprehensive freight index is3281.36 points, 0.8% higher than the previous reading. On August 16, the market freight rates (sea freight and sea freight surcharges) exported from Shanghai Port to the basic ports in the West and East US were US,581/FEU and US,297/FEU respectively, up 8.5% and 2.4% respectively from the previous period.
Attacks by Yemen's Houthi rebels on merchant ships in the Red Sea have caused ships to reroute around the Cape of Good Hope, meaning shipping goods from Asian factories to U.S. Eastern and Gulf Coast ports may require45 days or more. Therefore, the threat of strikes brought about by labor negotiations in the Eastern United States is prompting manufacturers to speed up shipments in the near future to avoid delayed delivery of goods and missing sales opportunities during the year-end holidays.