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'Extremely troubling': Canadian industries brace for shutdowns if rail blockades continue

A man holds a warrior flag during the sixth day of blockade of the CN/VIA train tracks in Tyendinaga Mohawk Territory, near Belleville, Ont., on Tuesday, Feb. 11, 2020, in support of Wet'suwet'en's blockade of a natural gas pipeline in northern B.C. (Lars Hagberg/The Canadian Press via AP)

Canadian industries are bracing for potential shutdowns as anti-pipeline blockades continue in Ontario and B.C., grinding railway traffic to a halt in some parts of the country.

The rail disruptions have stalled shipments of a range of products, including grain, perishable food and chemicals such as chlorine, and threaten to stop production for some companies if the protests continue.

“This is more than a rail problem. This is a Canadian economy problem,” Ryan Greer, the senior director of transportation policy at the Canadian Chamber of Commerce, said in an interview.

“Every day and every hour that it continues puts companies in a difficult position regarding their business decisions and their customers... for us and our members, this is extremely troubling.”

Canadian National, the country’s largest railway, said it would be forced to shut down “significant parts” of its network if the blockades are not removed. Canadian Pacific said in a statement that it has also been affected by the blockades and is monitoring the situation closely.

Demonstrators set up blockades in British Columbia and Ontario in solidarity with opponents of the Coastal GasLink pipeline project that crosses the traditional territory of the Wet’suwet’en First Nation in northwestern British Columbia.

Transport Minister Marc Garneau said in a statement released Wednesday that the federal government is closely monitoring the protests and has “an open line of communication” with its provincial counterparts.

“The right to peaceful protest is a fundamental right in Canada, but individuals who choose to use this right must do so in accordance with the law,” Garneau said.

“There are active court injunctions in place that were taken by CN to ensure service can resume, and they must be respected.”

Bob Masterson, the chief executive of the Chemistry Industry Association of Canada, said in an interview that some companies are just one day away from shutting down operations.

“Nothing is moving. At the last count from CN there was well over 200 trains basically stuck on major lines into the Port of Prince Rupert and between Ontario and Quebec,” Masterson said.

“It’s a critical situation.”

The Alberta Wheat and Barley Commission warned on Wednesday that a disruption that’s just a few days long “will cause a massive backlog with economic losses that are ultimately borne by farmers.”

“Delays will result in farmers being unable to deliver their grain, meaning they can’t be paid at least until service resumes,” Dave Bishop, the Alberta Barley Chair, said in a statement.

“We are still recovering from the harvest from hell and need reliable grain movement in order to get back on track.”

Brendan Marshall, head of economic and northern affairs at the Mining Association of Canada, said some producers are already curtailing production in an effort to prolong operations while the disruptions continue.

Olin, a U.S.-based company that produces chlorine and operates a facility in Becancour, Que., said that it may have to curtail or cease all production in Canada if there is no immediate solution to the ongoing rail issues. The Becancour facility serves about 100 customers, half of which are Canadian companies located in the eastern part of the country. According to Olin, about 85 per cent of Canadian municipal drinking water is treated with chlorine or chlorine derivatives.

“Olin is alarmed by the current freight rail situation in Canada, and we are concerned that customers and municipalities will not receive shipments of vital chemicals, including chlorine, within one week,” John Fischer, the company’s chief executive, wrote in a letter addressed to Transport Minister Marc Garneau.

“A disruption of this magnitude will have direct and immediate negative impacts on manufacturers, and untold ripple effects downstream and to the Canadian economy and public health.”

Across the country, industry groups across Canada are calling on all levels of government and law enforcement to end the blockades and disruptions to rail service.

Marshall said the disruptions are just the latest in a series of challenges impacting the country’s reputation of a reliable transport system.

CN’s potential shut down comes just days after Garneau issued a Ministerial Order requiring the slowdown of trains with 20 or more cars carrying dangerous goods following a derailment of a Canadian Pacific Railway train carrying crude oil in Guernsey, Sask.

Last November, a strike at CN saw service disrupted across the country. CN and CP have also grappled with tough winter conditions and strained capacity which, in some cases, has led to a backlog.

“The reliability of the transportation system is a significant investment determinant,” Marshall said.

“And while some of these challenges are beyond the control of decision makers, some of them aren’t, and we need to find a way forward where the scale and frequency of these disruptions is reduced.”

With files from the Canadian Press

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