Experts say CN rail blockade could lead to empty shelves

Industry players are warning governments that a rail blockade by anti-pipeline protesters could result in shortages of groceries, propane, drinking water and other goods.

Demonstrators set up a blockade on Canadian National Rail Co. tracks near Belleville, Ont., on Feb. 6 after RCMP officers enforced an injunction against opponents of the Coastal GasLink pipeline project that crosses the traditional territory of the Wet'suwet'en First Nation in northwestern B.C.

Fresh food, personal hygiene products and baby formula are among the goods that could soon run out as halted railcars in the Eastern half of the country clog CN's network from coast to coast.

"It's not like there's 10,000 idled trucks sitting in some subterranean basement somewhere that can just be dusted off if there's a rail stoppage. There's just too much volume for that," said Retail Council of Canada spokesman Karl Littler.

In a statement issued Tuesday afternoon, Gary Sands, senior vice-president of public policy and advocacy for the Canadian Federation of Independent Grocers (CFIG) in Toronto, said some of its members had already reported food shortages.

Meanwhile, some of the organization’s manufacturing partners in the food industry, “who in some areas, depend on rail for a high percentage of their supply, are expecting shortages very soon.”

Canadian Propane Association CEO Nathalie St-Pierre said wholesalers in the Maritimes had already begun to ration distribution while truck line-ups for the fuel in Sarnia, Ont., are now up to 10 hours long as water treatment plants, hospitals, farmers and rural residents await more shipments.

Drinking water could also fall into short supply if chlorine for water treatment stays off the tracks, according to chemicals trade group Responsible Distribution Canada.

"If something doesn't happen now, we're going to start seeing municipalities in Ontario beginning to have boil-water advisories going out," said president Cathy Campbell.

"This week it's going to get very scary."

Avery Shenfeld, chief economist of CIBC Capital Markets cautioned that layoffs could be imminent, with the broader impact bound to dent the economy unless a resolution is found soon. "If goods start piling up at ports and factories, we're going to see production halts that would affect employment."

Industries from manufacturing to fertilizer say they respect the right to peaceful protest but argue it's time for federal and provincial governments to bridge the impasse or enforce injunctions obtained by CN.

"We do feel like we're sort of getting sideswiped by a protest that pertains more to natural resources products than rail," said the retail council's Karl Littler.

Via Rail has cancelled all service on CN tracks in Canada, leaving only two northern routes open--between Sudbury and White River in Ontario and between Churchill and The Pas in Manitoba.

Prime Minister Justin Trudeau said Friday he had no plans to order the RCMP to end blockades of vital rail links across the country.

"We are not the kind of country where politicians get to tell the police what to do in operational matters," Trudeau said Friday in Munich, where he was attending a global security conference.

Early Friday morning, demonstrators lifted a rail blockade that was set up four days earlier on the line into Prince Rupert, B.C. reopening a key port.

First Nations leaders had suggested that would happen if federal and provincial politicians agreed to meet to discuss solutions to the ongoing dispute over construction of a natural gas pipeline through Wet'suwet'en traditional land.

Canadian Federation of Agriculture president Mary Robinson said the backed-up rail lines were hampering producers' ability to export commodities, warning of "huge financial consequences" as farmers do not get paid until products get to market.

"Rail service disruptions can also have negative impacts on animal welfare issues, as propane shipments are crucial to keeping barns heated during the winter months," she said.

While the repercussions of the rail shutdown are negative for the vast majority of stakeholders, the closure of Via's Ottawa-Toronto and Montreal-Toronto routes has proven to be a bonus for Porter Airlines, which said more passengers have booked flights between those cities over the past week as a result.