Canada’s west coast ports are major outlets for the country’s resource exports, including potash, coal, forestry products, pork and beef. A 13-day strike last year disrupted more than C$6 billion in trade at Vancouver and Port Rupert.

The British Columbia Maritime Employers Association said the proposed lockout of more than 700 foremen was preventative as the unit of the International Longshore and Warehouse Union representing them had already issued a 72-hour strike notice.

If the union withdraws the strike notice, Monday’s lockout will not go ahead, the association said in a statement.

The two sides are in protracted talks over a labour deal and have been negotiating with the help of a federal mediator. The stoppage would also affect the port of Prince Rupert.

“In anticipation of escalating and unpredictable strike action, the BCMEA has made a decision to take defensive action in the form of a coastwide lockout,” it said in a statement.

“It will not affect longshoring operations on grain vessels or cruise operations.”

The association said the lockout notice has been issued in order to “facilitate a safe and orderly wind down of operations” in anticipation of a strike.

ILWU local 514 president Frank Morena said in a statement that it had only planned “limited job action” such as refusing overtime and accepting some technological changes, Canadian Press reported.

The impasse comes after a long-simmering dispute over pay and working conditions, including concerns over automation, with each side accusing the other of bargaining in bad faith.

The Port of Montreal, where workers are represented by the Canadian Union of Public Employees, saw the start on Thursday of a strike at two terminals operated by Termont, which handle 40% of the port’s container traffic, but only 15% of its cargo.

Grain and other exports from the west coast were hit in August by a labor dispute at Canada’s two major railways, which the federal government ended by imposing binding arbitration.

The government has resisted calls to interfere in collective bargaining in other disputes, other than offering mediation.

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The U.S. House of Representatives on Wednesday voted to approve a bill to impose a tentative contract deal reached in September on a dozen unions representing 115,000 workers. The House also separately voted to require seven days of paid sick leave for rail workers, a measure the White House has not endorsed.

“There is no substitute in the American transportation system for a functioning freight rail network,” Transportation Secretary Pete Buttigieg told CNBC. “It wouldn’t just bring down our rail system, it would really shut down our economy.”

Buttigieg, Labor Secretary Marty Walsh and White House legislative director Louisa Terrell were meeting with Senate Democrats on Thursday to try to convince them to move quickly.

Separate votes are expected this afternoon on the rail and sick leave bills as well as a separate proposal to extend the “cooling off” period before workers could go on strike, aides said.

Senator Bernie Sanders and others demanded a separate vote on the sick leave issue as a condition of agreeing to fast-track consideration of the rail contract vote. He denounced railroad companies for refusing to offer paid sick leave.

“They are maybe the worst case of corporate greed that I have seen,” Sanders said. “That is really barbaric in the year 2022 in America.”

Schumer said he wants to see paid sick leave included in the legislation.

“Senators are working morning, noon and night to reach an agreement for us to act on this measure ASAP,” Schumer said. “The Senate cannot leave until we get the job done.”

Workers could go on strike as soon as Dec. 9, but the impacts in the U.S. and beyond would be felt as soon as this weekend as railroads stop accepting hazardous materials shipments.

A rail strike could freeze almost 30 per cent of U.S. cargo shipments by weight, stoke already surging inflation and cost the U.S. economy as much as US$2 billion per day, and strand millions of passenger railroad Amtrak and commuter rail passengers.

Railroads and the U.S. Chamber of Commerce oppose amending the contract deal that was struck in September largely on the recommendations of an emergency board appointed by Biden. The American Association of Railroads said the sick leave proposal would “undermine bargaining and artificially add to contracts beyond the scope of the Biden-endorsed agreements.”

President Joe Biden on Monday praised the proposed contract that includes a 24 per cent compounded pay increase over five years and five annual US$1,000 lump-sum payments, and had asked Congress to impose the agreement without any modifications.

There are no paid short-term sick days under the tentative deal after unions asked for 15 and railroads settled on one personal day.

Eight of 12 unions have ratified the deal. But some labor leaders have criticized Biden for asking Congress to impose a contract that workers in four unions have rejected over its lack of paid sick leave.

The contracts cover workers at carriers including Union Pacific, BNSF, CSX, Norfolk Southern and Kansas City Southern as well as the U.S. track of Canadian National Railway (CN).

— David Shepardson is a Reuters correspondent covering the U.S. transport sector from Washington, D.C.; additional reporting by Moira Warburton.

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Biden asked lawmakers to adopt the tentative deal announced in September “without any modifications or delay — to avert a potentially crippling national rail shutdown” and added that up to 765,000 Americans “could be put out of work in the first two weeks alone.”

House Speaker Nancy Pelosi said lawmakers would take up legislation this week “to prevent a catastrophic nationwide rail strike, which would grind our economy to a halt.”

On Monday, more than 400 groups called on Congress to intervene in the railroad labour standoff that threatens to idle shipments of food and fuel and strand travelers while inflicting billions of dollars of economic damage.

A rail traffic stoppage could freeze almost 30 per cent of U.S. cargo shipments by weight, stoke inflation and cost the U.S. economy as much as $2 billion per day by unleashing a cascade of transport woes affecting the energy, agriculture, manufacturing, healthcare and retail sectors (all figures US$).

“A rail shutdown would devastate our economy,” Biden said. “Without freight rail, many U.S. industries would shut down… Communities could lose access to chemicals necessary to ensure clean drinking water. Farms and ranches across the country could be unable to feed their livestock.”

Biden hailed the contract deal that includes a 24 per cent compounded wage increase over a five-year period from 2020 through 2024 and five annual $1,000 lump-sum payments.

Workers in four unions have rejected the tentative deal, while workers in eight unions have approved it.

Labor Secretary Marty Walsh, Transportation Secretary Pete Buttigieg and Agriculture Secretary Tom Vilsack have been involved in discussions with the rail industry, unions and agriculture industry stakeholders.

Senator Roger Wicker, the top Republican on the U.S. Senate’s commerce committee, praised Biden’s call to Congress to act and said no one side was fully happy with the compromise contract deal “but the responsible thing to do is avoid the strike.”

The Association of American Railroads said “congressional action to prevent a work stoppage in this manner is appropriate… No one benefits from a rail work stoppage — not our customers, not rail employees and not the American economy.”

In a letter on Monday, the U.S. Chamber of Commerce, National Association of Manufacturers, National Retail Federation, American Petroleum Institute, National Restaurant Association, American Trucking Associations and other groups warned that impacts of a potential strike could be felt as soon as Dec. 5.

Biden said Congress “should set aside politics and partisan division and deliver for the American people. Congress should get this bill to my desk well in advance of Dec. 9 so we can avoid disruption.”

“The risks to our nation’s economy and communities simply make a national rail strike unacceptable,” says the letter to congressional leaders first reported by Reuters, warning a strike could halt passenger railroad Amtrak and commuter rail services that “would disrupt up to seven million travelers a day.”

Biden’s Presidential Emergency Board in August released the framework for the tentative deal forged in September between major railroads and a dozen unions representing 115,000 workers.

Those carriers include Union Pacific, BNSF, CSX, Norfolk Southern and Kansas City Southern (KCS). Canadian National Railway (CN) and the unions representing its U.S. employees are also parties to the bargaining; Canadian Pacific Railway (CP) and its U.S. employees are not.

Unions and railroads have until Dec. 9 to resolve differences. If they do not, workers could strike or railroads could lock out employees — unless Congress intervenes. But railroads would halt hazardous materials shipments at least four days ahead of a strike deadline.

— David Shepardson is a Reuters correspondent covering the U.S. transportation sector from Washington, D.C.

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Speaking to reporters outside a fire station on Nantucket Island, Massachusetts, during a Thanksgiving holiday visit, Biden declined to provide details on how the talks were going because it was “the middle of negotiations.”

“My team has been in touch with all the parties, and in (a) room with the parties and I have not directly engaged yet because they’re still talking,” Biden said.

More than 300 groups, including the National Retail Federation and the National Association of Manufacturers, urged Biden last month to get involved to help avoid a strike that could idle shipments of food and fuel while inflicting billions of dollars of damage to an already struggling national economy.

Earlier this week, several of these groups renewed calls for Biden and Congress to swiftly intervene to prevent a strike or employer lockout ahead of the holiday season.

A rail traffic stoppage could freeze almost 30 per cent of U.S. cargo shipments by weight, stoke inflation and cost the U.S. economy as much as US$2 billion per day by unleashing a cascade of domestic and international transport woes affecting the energy, agriculture, manufacturing, healthcare and retail sectors.

On Monday, workers at the largest U.S. rail union voted against a tentative contract deal reached in September, raising the possibility of a year-end strike.

Labour unions have criticized the railroads’ sick leave and attendance policies and the lack of paid sick days for short-term illness. There are no paid sick days under the tentative deal. Unions asked for 15 paid sick days and the railroads settled on one personal day.

The Biden administration helped avert a service cutoff by hosting last-minute contract talks in September that led to the tentative contract deal.

Canadian National Railway (CN), which owns a significant amount of U.S. track with employees represented by the affected unions, is a party to the U.S. railways’ organization for “multi-employer national bargaining.”

U.S. railways represented by the U.S. National Carriers’ Conference Committee (NCCC) also include BNSF, CSX, Norfolk Southern and Union Pacific — as well as Kansas City Southern, which is still in the midst of a merger with Canadian Pacific Railway (CP).

CP itself, however, is not a party to the NCCC and is not involved in those labour talks.

— Reporting for Reuters by Nandita Bose and Humeyra Pamuk. Includes files from Glacier FarmMedia Network staff.

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French wheat sales to China and the prospect of Polish or German wheat being booked in the United States are creating an unexpected wave of demand for EU supplies after exports had been curbed by Russian competition in recent weeks, traders said.

Early in the session, U.S. wheat futures had traded higher at times as dry weather threatened U.S. winter crop areas.

But one trader, who spoke on condition of anonymity, said wheat prices turned downward after traders noted talk of a U.S. mill in Florida importing European wheat.

The most-active wheat contract on the Chicago Board of Trade (CBOT) settled the day down 7-3/4 cents to close at $8.10-1/2 a bushel (all figures US$).

Soybeans settled down seven cents at $14.29-3/4 bushel and corn settled down 2-3/4 cents to $6.56-3/4 a bushel.

The U.S. Department of Agriculture (USDA) on Monday rated 32 per cent of the U.S. winter wheat crop in good to excellent condition, unchanged from the previous week — the lowest for this time of the year in USDA records dating to 1986.

Some processors and mills are beginning to prepare for a potential rail traffic stoppage after workers at the largest U.S. rail union voted this week against a tentative contract deal reached in September, said Dan Basse, president of consultancy AgResource in Chicago.

“It’s all I’m hearing about, that people are planning ahead,” Basse said.

Corn futures saw pressure from wheat and a lack of fresh news. Meanwhile, market concerns that rising COVID-19 cases in China could dent the country’s commodity demand also weighed on soybean futures, as Beijing warned it was facing its most severe test of the pandemic.

— Reporting for Reuters by P.J. Huffstutter in Chicago; additional reporting by Julie Ingwersen in Chicago, Naveen Thukral in Singapore and Sybille de La Hamaide in Paris.

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Train and engine service members of the transportation division of the International Association of Sheet Metal, Air, Rail, and Transportation Workers (SMART-TD) narrowly voted to reject the deal. That unit, which includes conductors, brakemen and other workers, joins three other unions in rejecting a deal brokered via a board appointed by U.S. President Joe Biden.

“There’s a lot of anger about paid sick leave among the membership” who kept goods flowing during the early days of the COVID-19 pandemic, said Seth Harris, a professor at Northeastern University.

Labour unions have criticized the railroads’ sick leave and attendance policies and the lack of paid sick days for short-term illness. There are no paid sick days under the tentative deal. Unions asked for 15 paid sick days and the railroads settled on one personal day.

Railroads have slashed labour and other costs to bolster profits and are fiercely opposed to adding paid sick time that would require them to hire more staff. Those operators — which include Union Pacific, BNSF and CSX as well as the U.S. business of Canadian National Railway (CN) — say the contract deal has the most generous wage package in almost 50 years of national rail negotiations.

“The union needs to get this done in advance of the new Congress,” said Reliant Labor Consultants principal Joe Brock, a former Teamsters local president.

Republicans, who historically favour corporations over unions, earlier this month won control of the U.S. House starting in January.

“I see a minimal improvement in sick pay, and huge pressure from the (Biden) administration to accept a deal,” Brock said.

But railroads are also under pressure to wrap up talks. Major U.S. industry groups complain that rail industry cost cuts have hurt service. On Monday, several renewed calls for Biden and Congress to swiftly intervene to prevent a strike or employer lockout ahead of the holiday season.

White House spokesperson Karine Jean-Pierre said a shutdown would hurt American families, farms and businesses. She said Biden is being briefed on the issue and that Labour Secretary Marty Walsh is “very much engaged.”

“We continue to urge both sides to finish their work in good faith and avoid even the threat of a shutdown,” she told reporters. “But like we do for all issues, our team is preparing and planning for all possible outcomes.”

‘Without a strike’

A rail traffic stoppage could freeze almost 30 per cent of U.S. cargo shipments by weight, stoke inflation and cost the U.S. economy as much as US$2 billion per day by unleashing a cascade of transport woes affecting the energy, agriculture, manufacturing, healthcare and retail sectors.

Last week, the U.S. Chamber of Commerce said Congress should step in to prevent any disruption, warning it would be catastrophic for the economy. Automaker General Motors has said a halt would force it to stop production of some trucks within about a day.

“This can all be settled through negotiations and without a strike,” SMART-TD President Jeremy Ferguson said in a statement.

The National Carriers’ Conference Committee (NCCC), which represents the nation’s freight railroads in talks, said the “continued, near-term threat” of a strike “will require that freight railroads and passenger carriers soon begin to take responsible steps to safely secure the network in advance of any deadline.”

The railroads showed no sign of being willing to reopen talks and said, “Congress may need to intervene, just as it has in the past, to prevent disruption of the national rail system.”

The standoff between U.S. railroad operators and their union workers in September disrupted flows of hazardous materials such as chemicals used in fertilizer and disrupted U.S. passenger railroad Amtrak service as railroads prepared for a possible work stoppage.

Unions, including a separately contracted unit covering more than 1,000 SMART-TD yardmasters, have ratified nine of 13 agreements covering about half of the 115,000 workers affected by the talks.

The deal includes a 24 per cent compounded wage increase over a five-year period from 2020 through 2024 and five annual US$1,000 lump sum payments.

Beginning on Dec. 9, SMART-TD would be allowed to go on strike or the rail carriers would be permitted to lock out workers, unless Congress intervenes. Three other unions that rejected the deal have already agreed to extend a strike deadline until early December.

If there is a strike by any of the unions that voted against the deal, Brotherhood of Locomotive Engineers and Trainmen and other rail unions that ratified agreements have pledged to honour picket lines.

The Biden administration helped avert a service cutoff by hosting last-minute contract talks in September that led to a tentative contract deal.

— Reporting for Reuters by David Shepardson in Washington and Lisa Baertlein in Los Angeles; additional reporting by Jeff Mason and Trevor Hunnicutt.

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The National Carriers’ Conference Committee (NCCC) and the International Brotherhood of Teamsters (BMWED) that represents 11,000 workers extended the current cooling off period that previously was set to expire Nov. 19. The NCCC said the “extension eliminates the threat of a near-term freight rail service disruption.”

A rail shutdown could freeze almost 30 per cent of U.S. cargo shipments by weight, stoke inflation, cost the U.S. economy as much as $2 billion per day and unleash a cascade of transport woes affecting the energy, agriculture, manufacturing, healthcare and retail sectors (all figures US$).

BMWED said without an extension railroads could have begun ceasing rail operations within the next few days in anticipation of a Nov. 20 strike and suggested that “would also represent a blatant attempt to cause panic and economic harm to the railroads’ customers and the U.S. economy right before the Thanksgiving holiday.”

Another union representing about 4,900 locomotive machinists, roadway mechanics and facility maintenance personnel on Saturday narrowly ratified the tentative contract agreement.

The union was the seventh of 12 to approve the deal, while BMWED and the Brotherhood of Railroad Signalmen (BRS) union, representing more than 6,000 members, voted against the deal.

The deal included a 24 per cent compounded wage increase over a five-year period from 2020 through 2024 and five annual $1,000 lump sum payments.

The unions represent 115,000 workers at U.S. railroads including Union Pacific, BNSF, CSX, Norfolk Southern and Kansas City Southern as well as Canadian National Railway’s (CN) track in the U.S..

CSX chief financial officer Sean Pelkey said at a conference the railroad is “optimistic we’ll get to a good solution to be able to pay people much more than what they’re taking home today.”

When the contract is resolved “that really gives us the line of sight to figure out how do we how do we drive a better employee experience,” he added.

— David Shepardson reports on the U.S. transportation sector for Reuters from Washington, D.C.

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As of Wednesday, three unions out of the 12 representing unionized rail workers in the U.S. have yet to reach tentative agreements with the bargaining group for U.S. rail carriers. A 30-day “cooling off” period between those three unions and the railways ends at 12:01 a.m. Friday.

Just two unions out of the nine that have reached agreements have so far voted to ratify those deals. The results of six ratification votes are pending; a seventh union, the International Association of Machinists, said Wednesday its members have voted to reject the tentative deal it reached Aug. 29.

Canadian National Railway (CN), which owns a significant amount of U.S. track with employees represented by the affected unions, is a party to the U.S. railways’ organization for “multi-employer national bargaining.”

U.S. railways represented by the U.S. National Carriers’ Conference Committee (NCCC) also include BNSF, CSX, Norfolk Southern and Union Pacific — as well as Kansas City Southern, which is still in the midst of a merger with Canadian Pacific Railway (CP).

CP itself, however, is not a party to the NCCC and is not involved in those labour talks.

Thus, if talks between unions and the NCCC-represented railways end in a work stoppage, CP said Tuesday it “will continue to fully operate in Canada as well as in the U.S., subject only to any applicable embargo imposed by any of the U.S. railroads.”

CN, meanwhile, said in a separate statement Monday it had imposed embargoes effective that day on all “rail security-sensitive materials” and “time-sensitive” commodities bound from Canada to the U.S. and Mexico — or bound from origins in the U.S. and Mexico into Canada — and has set up a permit system accordingly.

CN’s intermodal shipments and its “Canada-to-Canada” carload shipments of all commodities will continue to move as usual, the company added.

However, CN said Monday, other freight customers “may also start to experience delayed or suspended service over the course of this week, as the railroads prepare for the possibility that current labour negotiations do not result in a resolution and are forced to substantially reduce operations.”

CP, in its memo to customers Tuesday, said it hasn’t yet launched any such embargoes but is “closely monitoring developments to evaluate any potential impact to shipments on CP’s network.”

However, CP added, embargoes set up by “other railroads” may hinder its ability to move equipment on its own North American network — for example, any traffic that’s interchanged to any of the involved or affected railroads, or traffic that relies on haulage handling or running rights agreements or reciprocal switch service on such railroads.

For CP’s intermodal customers, U.S.-destined traffic from the Port of Montreal and Port Saint John may be impacted, the railway said.

Apart from the lines to be acquired via its deal for Kansas City Southern, CP’s own directly-operated U.S. track reaches Kansas City, Minneapolis, Milwaukee, Chicago, Detroit, Albany and Searsport, Maine.

CN’s directly-owned U.S. track, meanwhile, reaches U.S. destinations including New Orleans, Mobile, Minneapolis, Omaha, Chicago, St. Louis, Pittsburgh and Memphis, among others. — Glacier FarmMedia Network

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With farmers starting to harvest autumn crops that are shipped to meat and biofuels producers, the shipping disruptions could add to already high inflation. Farmers also plan to add fertilizer to fields after the harvest, and shipments of fertilizer are being delayed.

Max Fisher, chief economist at the National Grain and Feed Association, which represents most U.S. grain handlers, said rail customers reported at least one railway would stop taking grain shipments on Thursday morning.

Most major U.S. railways have already stopped accepting new shipments of ammonia fertilizer and other potentially hazardous materials, said Justin Louchheim, senior government affairs director at The Fertilizer Institute, an industry group.

Louchheim said fertilizer producers are now evaluating how much storage they have for ammonia that cannot move by rail, and whether some can move by truck.

The potential rail shutdown looms just six weeks before most Midwest farmers would begin applying fertilizer, said Josh Linville, fertilizer director at StoneX Group. About 40 per cent of the U.S. fertilizer supply is on a rail car at some point before arriving on a farm, he said.

Railroads have until a minute after midnight on Friday to reach tentative deals with holdout unions representing about 60,000 workers.

Worries about service interruptions boosted prices for corn-based ethanol at several hubs and kept sellers out of the market, said Josh Pedrick, a managing editor for S&P Global Commodity Insights.

The Association of American Railways (AAR), which represents railroad companies, did not immediately respond to request for comment on grain transportation.

The work stoppage would be keenly felt in states like North Dakota, South Dakota, Minnesota and Nebraska, from which grain is hauled via rail to ports in the Pacific Northwest for export, said Thomas Lahey, domestic freight manager at grain merchandiser Columbia Grain International. Grain elevators in the upper Midwest move soybeans to the PNW mostly via BNSF, Canadian Pacific Railway and Union Pacific, he said.

U.S. Class 1 railroads transported nearly 1.5 million carloads of grain in 2020, including 691,000 carloads of corn, 340,000 carloads of soybeans and 248,000 carloads of processed soybeans like soymeal and soyoil, AAR said.

Enough feed?

U.S. chicken producers rely on about 27 million bushels of corn and 11 million bushels of soymeal every week to feed their birds, the National Chicken Council said. Much is moved by rail.

“Any disruption of service could negatively impact the welfare of the birds, and ultimately impact production at a time when Americans are already dealing with record food inflation,” council spokesman Tom Super said.

In North Carolina, a pork and poultry producer, local grain growers do not produce enough corn to feed all the farm animals, said Bob Ford, executive director of the North Carolina Poultry Federation.

“We’d be in trouble if they went on strike for very long,” Ford said. “We’d run out of corn.”

Wayne-Sanderson Farms, a Georgia-based chicken company owned by Cargill and Continental Grain, is working with local corn producers to augment feed supplies if needed during rail disruptions, spokesman Frank Singleton said.

The beginning of corn harvesting in the southern United States, a main poultry region, “will relieve some of the pressure” on feed supplies, he said.

Some rail customers that feed livestock do not have enough soymeal, said Fisher, of the National Grain and Feed Association. In a worst case scenario, that could force some producers to cull animals.

Railroads also ship hexane, a chemical solvent that crushers use to extract oil from soybeans, said Mike Steenhoek, executive director of Soy Transportation Coalition.

“Any slowdown or stoppage of rail service — especially on the eve of harvest — would significantly impact farmers’ ability to meet customer demand — both domestically and internationally,” Steenhoek said.

— Reporting by P.J. Huffstutter and Tom Polansek in Chicago; additional reporting by Karl Plume in Chicago, Rod Nickel in Winnipeg and Stephanie Kelly in New York.

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The potential shutdown, which could come as early as Friday, could freeze almost 30 per cent of U.S. cargo shipments, stoke inflation, impede supplies of food and fuel, cost the U.S. economy about US$2 billion per day and cause transportation woes.

Railroads including Union Pacific, Berkshire Hathaway’s BNSF, CSX and Norfolk Southern have until a minute after midnight on Friday to reach tentative deals with three hold-out unions representing about 60,000 workers.

If agreements are not reached, there could be union strikes or employer lockouts. But the railroads and unions also could agree to stay at the bargaining table or the Democratic-led U.S. Congress could intervene by extending talks or establishing settlement terms.

The Biden administration’s push comes as food, energy, automotive and retail groups implore Congress to intervene, saying a rail shutdown could threaten everything from global grain supplies to shipments of goods related to Christmas holiday shopping.

White House press secretary Karine Jean-Pierre said the administration is asking truckers and air shippers to assist should rail service cease and also is considering invoking emergency authorities. Jean-Pierre added that the administration is hosting daily interagency meetings to assess which supply chains and commodities are at highest risk.

The White House has told railroads and unions that “a shutdown is unacceptable and will hurt American workers, families and businesses, and they must take action to avert it,” a White House official told Reuters, speaking on condition of anonymity.

One key issue is ensuring “continued distribution of vital hazardous materials that depend on rail transport, such as chlorine for water treatment plants,” this official added. Railroads on Monday stopped accepting shipments for hazardous materials such as chlorine and chemicals used in fertilizer so they are not stranded in unsafe locations if rail traffic stops.

The U.S. energy sector relies on railroads to move coal, crude oil, ethanol and other products.

Some railroads plan to impose additional restrictions that could impact food suppliers and online retailers that use intermodal services that connect ships, trains and trucks. BNSF, which serves the western U.S., said it will stop accepting refrigerated intermodal cargo. Norfolk Southern, which serves the eastern U.S., said it will stop accepting all intermodal shipments.

U.S. passenger railroad Amtrak, which uses tracks maintained by freight railways, is facing growing disruptions. Amtrak said it will cancel trains on seven more long-distance routes on Wednesday after it began canceling trains on four long-distance routes on Tuesday.

High stakes

The stakes are high for Biden, who has vowed to rein in soaring consumer costs ahead of November elections that will determine whether his fellow Democrats maintain control of Congress.

Biden appointed an emergency board in July to create a framework for settlement terms.

That has not happened since the early 1990s, when Congress sent the parties into final and binding arbitration.

Unions in the current talks have been offered significant pay increases. Three of 12 unions, representing about half of the 115,000 workers affected by the negotiations, have yet to sign deals. They are grappling with railroads over working conditions that they have said worsened after the industry slashed its workforce by almost 30% during the past six years.

Rail customers have said a shutdown will send them scrambling for alternative transportation and storage for everything from ammonia and fuel to cars and chicken feed.

It takes about four trucks to handle cargo in a single rail car. The United States does not have the estimated 467,000 trucks or the necessary labour to support such a shift. Beyond that, some cargo is too heavy or large to travel over the road.

A rail work stoppage could strike as U.S. farmers harvest corn, wheat and soybeans for export around the world, according to the National Grain and Feed Association.

“The economic damages across the food and agricultural supply chain would be swift and severe,” the group said.

Justin Louchheim, senior director of government affairs at the Fertilizer Institute, which represents companies that rely on ammonia supplies, added: “When you contemplate global food security, I’d say it’s a crisis right now.”

Automakers worry that a disruption could empty dealer showrooms by stranding cars in the wrong places. Toyota said it would have to store vehicles and “many locations would run out of storage within two to four days of production.”

— Reporting for Reuters by David Shepardson and Lisa Baertlein; additional reporting by Ben Klayman, Joe White, Laura Sanicola, Stephanie Kelly, Arathy Somasekhar and Tom Polansek.

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