Rail service disruptions in North America are typically caused by weather-related events like hurricanes, flooding, and snowstorms that can wreak havoc on rail lines. With such events happening regularly across North America, it’s not a matter of ‘if’ rail service disruption will occur, but ‘when.’
Recent events in Canada, however, shed light on another threat to rail service: labor disputes. In this article, we’ll summarize what’s happening up North and give you important information that will help keep your bulk freight in motion.
The situation with Canadian Rail
The labor dispute between the Teamsters Canada Rail Conference and the two largest Canadian railways, CN and CPKC, has been brewing for several months, rooted in disagreements over working conditions, particularly around scheduling, shift durations, and employee availability. The rail companies proposed extending shifts from 10 hours to 12 hours, a move the union strongly opposed, arguing that it would exacerbate worker fatigue and compromise safety.
The union also raised concerns about overall working conditions, which they felt were deteriorating. Negotiations had been ongoing for nine months, with the rail companies making multiple offers to improve wages and conditions, but the union found these offers insufficient.
The impasse led to a historic lockout by both railways, marking the first time such action was taken against Teamsters workers, and triggering significant disruptions in Canada's export-driven economy. This escalation eventually prompted the federal government to intervene, leading to the controversial decision to impose binding arbitration and end the work stoppages.
While it seems like the government’s intervention has put this issue to rest, the union is looking to continue its fight.
What happens during a rail service disruption?
When rail freight service is disrupted by a labor dispute, weather event, or equipment malfunction, the entire supply chain undergoes significant challenges and adjustments. The impact extends beyond the immediate interruption, causing delays in the transportation of goods from production to distribution points.
Option 1: Ride it Out
The first instinct when faced with a rail service interruption is often to simply wait for things to return to normal. This approach might be practical in some cases, but it’s important to consider the potential duration of the disruption. In the case of a labor dispute, the timeline for resuming services could be prolonged. Not only do you have to wait for an agreement to be reached, you need to account for the time required to return workers to their job sites. If your business relies on a steady flow of goods, such an extended period of inactivity might not be feasible, making this option less than ideal.
Option 2: Turning to Trucks
Another strategy is to turn to trucks to fill the gap left by disrupted rail services. This option allows for a quicker resumption of your shipping operations, but it’s not without its own challenges.
The primary concern is cost. While using trucks for bulk transportation can rapidly get your products moving again, it typically comes at a higher price than rail. Depending on the situation, you might be able to offset some of these costs through reimbursement from the rail provider, though this is contingent on the specific circumstances of the disruption.
Another critical factor is capacity. Even if you’re willing to absorb the higher costs, finding available trucks during an emergency can be difficult. This is where it can be invaluable to partner with a bulk freight 3PL, like Bulk Connection, with a broad North American network. Such a provider can leverage its extensive connections to pull in trucks from far and wide, ensuring that your supply chain keeps moving. In contrast, if your logistics network is limited to asset-based bulk carriers, your options will be restricted to the equipment and routes available within that specific carrier’s portfolio.
Proactive preparation: plan for the unexpected
To minimize the impact of future disruptions, there are proactive steps you can take now to safeguard your operations.
First, consider maintaining a reserve inventory, or “rainy day stock,” of your products. By having this extra stock on hand, you can continue to fulfill orders at reduced volumes even if rail services are temporarily halted. This buffer can provide your supply chain with the flexibility it needs to weather short-term disruptions.
Secondly, it’s wise to establish a relationship with a bulk freight 3PL before an emergency occurs. By building this partnership in advance, your 3PL provider will have the opportunity to familiarize themselves with your products, facilities, and specific equipment requirements. When a disruption strikes, this prior knowledge enables the 3PL to respond swiftly and efficiently, ensuring your shipments are handled with the care and speed they require.
Lean on Bulk Connection’s national carrier network in good times and bad
Bulk Connection is a liquid and dry bulk freight 3PL with decades of experience handling rail disruptions and other challenges. In fact, on our first day on the job in 1987, there was a disruption that resulted in us pulling in drivers and equipment from across the Eastern US to get product delivered to the Midwest.
Our network has grown a lot since then and we now have one of the largest networks of bulk carriers in North America.
We also know your products and specialize in matching them to the best carrier and equipment for the job – in routine scenarios or emergencies. Our ISO-9001-certified operations are supported by our team of bulk freight experts who are available 24/7 to ensure that your products move swiftly and safely. Contact us today to put our network to work for you.
