August 22, 2024 (OTTAWA) – The Canadian food and beverage manufacturing industry is issuing an urgent warning as the CN and CPKC rail strike has officially commenced, marking a significant disruption to the nation’s food supply chain. The strike will have effects on the availability and affordability of food across Canada, with profound consequences for both consumers and businesses.
Rail transport is critical for moving essential agricultural products, food and beverage processing inputs, and finished goods across the country. For many commodities, rail is the only viable option, which makes this disruption especially severe. As a result, manufacturers are now grappling with escalating transportation costs and limited alternatives.
The strike’s ripple effects are being felt across the industry, especially among small and medium-sized enterprises (SMEs), which are struggling to absorb the additional costs and navigate the complex logistical challenges posed by the disruption. While some companies have managed to mitigate the immediate impact by preemptively shipping additional materials and products to warehouses, this has resulted in a surge in storage costs. The anticipated increase in truck traffic at border crossings is likely to cause significant congestion, resulting in longer wait times and delays in customs clearance. This will further strain the already overburdened supply chain.
The Canadian food and beverage manufacturing industry echoes the calls from other sectors for the government to intervene and bring this disruption to a swift conclusion. The industry also urges the government to collaborate with stakeholders to develop long-term strategies to mitigate the impact of future disruptions on Canada’s food supply.
Given the scale of this disruption, it is anticipated that it will take weeks for supply chains to return to normal, even after the strike ends. Immediate action is required to prevent long-term damage to the Canadian economy and to safeguard the nation’s food security.
Food and Beverage Canada – Aliments at boissons Canada
Alberta Food Processors Association
BC Food & Beverage
Food and Beverage Ontario
Food & Beverage Atlantic
Conseil de la transformation alimentaire du Québec (CTAQ)
Food and Beverage Manitoba
The Baking Association of Canada
Dairy Processors Association of Canada
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“This strike poses an unprecedented threat to Canada’s food supply chain. With so many essential commodities dependent on rail, the impact will be felt across the entire industry, from producers to consumers. We urgently call on the federal government to consider all available options to bring this disruption to an end. Immediate action is required to ensure that our food supply chain remains operational.” – Kristina Farrell, CEO, Food and Beverage Canada
“Ensuring the reliability and stability of our food supply chain is of critical importance. We need an immediate resolution to this dispute for the benefit of all Canadians.” – Chris Conway, CEO, Food and Beverage Ontario
“We are particularly concerned about the repercussions of this work stoppage, even if it is short-lived. The resulting delays could ripple through the entire supply chain, impacting food production and distribution for weeks after the conflict ends.” – Sylvie Cloutier, CEO, CTAQ
“Another supply chain disruption could have dire consequences for Canada’s already vulnerable food supply chain. We urge all parties to work collaboratively and to not continue with an action that will ultimately harm all Canadians.” – James Donaldson, CEO, BC Food & Beverage
“This labour disruption will significantly impact dairy processors’ transportation costs, trade activity and supply chain resilience. We urge a swift resolution of this dispute in the public interest.” – Mathieu Frigon, President & CEO, Dairy Processors Association of Canada