Oil, Wheat Shipments Grind to Halt and Imperil Canada’s Economy

The five-day-old strike could shave off a quarter-point from growth this quarter if it lasts through Dec. 5, when lawmakers, who have the power to break the impasse, return from a hiatus. That’s considerable considering economists see Canada expanding at just a 1.3% annual rate during the period.

A CN rail car carries fuels past a petroleum plant in Montreal. (Photo: Brent Lewin)

Canada’s $1.7 trillion economy has long been closely tied to the ebbs and flows of global trade.

Now, a homegrown crisis threatens to hobble its export industries and stunt its already weak growth.

This week, thousands of workers at Canada’s largest rail company walked off the job in one of the largest nationwide labor strikes in recent memory. Shipments of exports like wheat, crude oil and aluminum — largely from its inland prairies and bound for the U.S. and the world — are grinding to a halt. Freight traffic has clogged up at the border. And shortages of propane risk leaving thousands in the two largest provinces without heat.

While the dispute itself, over working conditions and benefits for some 3,200 conductors and yard operators at Canadian National Railway Co., might sound like a local affair, the economic fallout is anything but. The five-day-old strike could shave off a quarter-point from growth this quarter if it lasts through Dec. 5, when lawmakers, who have the power to break the impasse, return from a hiatus. That’s considerable considering economists see Canada expanding at just a 1.3% annual rate during the period.




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