Concern grows about rail strike’s effect on agriculture

News News | Sep 14, 2022

Both farm groups and lawmakers warned Tuesday that a rail strike, which is possible beginning Friday, would have a devastating effect on the agricultural economy.

A cooling-off period is in effect in which railroads and unions are negotiating, but it ends on Friday.

Railroads have already said they don't want to accept hazardous material, including fertilizer.

Maersk Line, an ocean shipper, told its customers, "Due to the potential strike, we are evaluating our cargo status prior to vessel arrivals. Most rail operators are implementing contingency plans this week (to ensure hazardous and special cargoes are in a safe place), which include stopping acceptance of on-dock rail at port container terminals and closing gates to intermodal traffic.

"The BNSF has announced that effective 12:01 a.m. Sept. 14, they will no longer accept exports of refrigerated and hazardous cargoes. We believe it likely that this type of restriction will increase in scope over the coming days."

The National Corn Growers Association called on Congress to act.

"Rail is an essential piece of the agricultural supply chain, particularly as we approach harvest season, so any disruption to rail services would have a negative and lasting impact on our growers," said Brooke Appleton, vice president of public policy at NCGA. "Given the effect this could have on farmers and the nation's economy, we urge both sides to do whatever it takes to resolve this issue by the end of the week. If an agreement is not reached soon, Congress needs to act."

Sen. Deb Fischer, R-Neb., said in a speech on the Senate floor:

"I think it's important that people understand what kind of economic impact such a shutdown would have and how it would upend our nation's agricultural sector.

"The consequences would be devastating.

"When agricultural products can't be transported, there will be price hikes and shortages.

"Our international exports of commodities like corn, soy, wheat, of which a large share move by rail, will fall dramatically.

"Fertilizer prices – an already expensive input cost due to inflation – will further skyrocket. The mere prospect of a shutdown on Friday means fertilizer and other hazardous materials have already started to be removed from the rail networks on Sept. 12.

"Biofuel plants could be forced to scale down operations or completely shut down.

"I would also point out that we have harvest coming up in Nebraska. Family farmers in my state, many of whom are grappling with rapidly rising input costs, need a good harvest season.

"If rail service isn't feasible, that possibility could go out the window.

"Nine of the 12 labor unions in the rail sector have been able to utilize the President Emergency Board recommendations to come to an agreement. I’d note that the board is composed of neutral, impartial individuals appointed by the president.

"Their recommendations are widely seen as benefiting all parties.

"It's critical that the remaining labor unions and the rail industry use those recommendations to reach an agreement as soon as possible."

Sen. Dianne Feinstein, D-Calif., said in a news release, "I am very concerned about the potential for a stoppage on our nation's freight railroad lines and urge both sides – the freight rail companies and the unions – to continue engaging in negotiations to reach an agreement and end this dispute as soon as possible."

Feinstein said she was "encouraged" by the engagement of the White House and the Labor Department and hopes an agreement can be reached before the Friday deadline.

Feinstein did not call for congressional intervention, which has been proposed, but said, "Our nation depends on the timely transfer of goods by rail and on the men and women who keep the trains running on time. We simply can't afford to place further strain on our economy and our supply chain, which has been steadily recovering from its pandemic woes.

"A freight rail work stoppage now could set back our strong economic recovery at a precarious time. We must do all we can to avoid such a result."

Jun 2, 2023

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