Union blames railroad for propane shortages in Ontario, Quebec

Trains are seen at the Intermodal Terminals in Brampton, Ontario, on Nov. 19. Cole Burston/Bloomberg

Reports of propane shortages in Ontario and Quebec appear to be largely manufactured by Canadian National Railway Co., according to the union that began a fourth day on strike at the country’s largest railroad.

The fact that the trains are not transporting propane is a business decision by CN Rail, as more than 1,800 locomotive engineers and 600 supervisors are free to cross picket lines and continue to operate freight trains, the Teamsters Canada Rail Conference said in a statement Friday.

“While CN is nowhere near operating at full capacity, we think enough trains are running to allow CN to supply Ontario and Quebec with propane,” Lyndon Isaak, president of the union, said in the statement. “We wonder if CN is choosing not to ship goods like propane in order to manufacture a crisis and force back-to-work legislation.”

About 3,200 conductors and yard operators at Canadian National walked off the job Tuesday, snarling shipments from one of the world’s largest exporters of raw materials. The Quebec premier said the province’s supply of propane is set to run out in four days, and the movement of freight destined for the U.S. and global markets stalled on Canada’s largest railway.

Canadian National didn’t immediately respond to a request for comment. The company’s shares dropped 0.7% to C$119.14 at 9:31 a.m., bringing its losses since the start of the strike to 4.8%.

Should the disruption last until Nov. 30 it could crimp gross domestic product by as much as C$2.2 billion ($1.7 billion), according to Toronto-Dominion Bank economists Brian DePratto and Derek Burleton. If it extends until Dec. 5, when lawmakers resume work in Ottawa, it could put a C$3.1 billion hole in the economy. That’s equivalent to a drag of nearly one-quarter percentage point in the fourth quarter, the economists estimated.

The union has been quiet as negotiations with Canadian National continue in Montreal to resolve the dispute, but comments by Quebec Premier Francois Legault appear to have provoked the Teamsters’ statement on propane. Legault said the fuel, which is largely shipped in from Sarnia, Ontario, is running low in Quebec, threatening the heating systems of hospitals and elderly residences across the province.

The union is striking over labor conditions and drug benefits, and says fatigue is a major issue. No substantive progress has been made on the union’s key workplace safety and health issues since the strike begun, the labor group said.

“We are fighting for the safest workplace possible,” Isaak said. “We’ve lost nine of our members in various railway accidents over the past 24 months, including three from the group at CN that’s currently on strike.”

CN Rail Chief Executive Officer Jean-Jacques Ruest said on Thursday that the Montreal-based company has taken reasonable steps to end the economic impact by offering binding arbitration, something the union has rejected.

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