Numerous industries would be affected by a freight-rail strike. Here’s what some of them are saying:
We urge [Congress] to utilize all possible measures to avoid a service disruption in the freight rail network. While it remains our hope that the parties will successfully conclude negotiations by this week’s deadline, Congress is empowered to institute the recommendations produced by President Biden’s PEB and approved by both the Class I railroads and numerous labor groups. Should it become necessary to intervene, we implore you to use your authority as leaders of Congress to diminish any further supply chain uncertainty and economic damage.
[The American Petroleum Institute] requests that Congress prepare to act if negotiations this week fail to produce agreement to facilitate a workable settlement and prevent catastrophic disruptions to the freight rail network. Last Friday, representatives of the oil and gas industry began receiving notifications from the railroads that they intend to begin curtailing shipments of hazardous materials and other chemicals as of today, to ensure carloads of product are not stranded on the tracks if a work stoppage occurs. This curtailment alone, could have profound impacts on the ability of our industry to deliver critical energy supplies to market.
The harm to the U.S. economy from the potential rail strike has already begun, as railroads are embargoing shipments of materials critical to the refining and petrochemical industries. Railroads are curtailing operations prior to the September 16th, 2022, deadline to ensure their networks can be shut down safely and in compliance with applicable regulations should a sudden work stoppage occur. Without the ability to move critical materials in and out of refineries and terminals, our members will experience a significant impact on operations.
[The American Fuel and Petrochemical Manufacturers] respects the negotiation process and the positions of railroads and the rail labor unions. However, the implications of a rail strike on our economy are obvious and potentially extreme, so Congress must take steps immediately to prevent a work stoppage.
The highest-volume chemical carried by US railroads is ethanol.
More than half of all rail chemical carloads consist of various industrial chemicals, including soda ash, caustic soda, urea, sulfuric acid and anhydrous ammonia.
Plastic materials and synthetic resins account for close to a quarter of rail chemical carloads.
Most of the rest is agricultural chemicals.
In the US, chemical railcar loadings represent about 20% of chemical transportation by tonnage, with trucks, barges and pipelines carrying the rest.
While the PEB has done its job, it is now time for Congress to ensure that a freight rail shutdown does not occur. As we have in the past, Congress has the ability to implement the PEB’s recommendations in whole, which we would encourage happens quickly after the cooling off period ends.
We are in the middle of the peak import season as retailers bring in their holiday merchandise for the all-important fourth quarter. Any rail network disruptions this month could have long-lasting negative effects on this important selling season. Product delays and shortages are correlated with inflation – an issue of great significance to Americans and the economy.
Ultimately, we continue to implore the parties to resolve these negotiations on their own, especially with the PEB recommendations. In the event they do not, however, we ask you to be prepared to act to protect the supply chain and ensure no interruption to rail service.
The U.S. rail network moves critical agricultural inputs and significant quantities of agricultural products. These essential items are transported by rail to domestic facilities and to ports for export abroad. A complete stoppage of the rail system would lead to shutdowns or slowdowns of rail-dependent facilities resulting in devastating consequences to our national and global food security.
Leaders around the world are already concerned about food shortages and famine due to drought and geopolitical challenges, such as the invasion of Ukraine, which accounts for ten percent of the global exports of wheat. A freight rail stoppage would occur as America’s farmers harvest their crops and would exacerbate global food insecurity and likely contribute to further geopolitical instability in regions that experience famine. Congress must be willing to act to ensure our farmers and ranchers can continue to help feed the world.
The freight rail system already is significantly challenged and many rail customers are not receiving timely rail service. A complete stoppage of rail service, even for a single day, would escalate these challenges. Most freight railroads currently lack extra capacity to make up for down time. Thus, a sizable portion of freight backlogged due to a stoppage may never be made up leading to less production from rail-dependent businesses to the detriment of producers and consumers.
A rail strike could create a debilitating logistics chokepoint for the movement of energy and materials resources essential to our grid reliability and energy affordability, as well as our manufacturing sector and the energy security of our allies. Ongoing service issues continue to threaten coal deliveries, impeding the delivery of essential fuel as utilities work to shield consumers from soaring natural gas prices and build up stockpiles to ensure they have the fuel security needed for the winter. Curtailing the supply of materials essential to manufacturing will also push up costs and reverse any progress made in solving the supply chain challenges driving inflation. The U.S. has abundant mined resources, but they are dependent on reliable, efficient rail service.
The production and movement of fertilizer is heavily dependent on rail, both for finished product and production inputs. Many of those products have already been removed from the rails in preparation for a potential rail stoppage.
“For every day this uncertainty continues, we essentially lose five shipping days because of the ramp down and ramp up,” continued [Fertilizer Institute president and CEO Corey] Rosenbusch. “If this situation is not resolved by tomorrow, it could quickly impact supplies for fall application and lead to a reduction in U.S. production at a time when 70% of European production has been curtailed or ceased due to Russia’s shutoff of natural gas supplies.”
Congress has the power to step in and avert a rail strike if agreements between the rail carriers and labor unions are not reached.
“Congress can act to implement the President’s Emergency Board compromise agreement,” Rosenbusch concluded. “Action must be taken to ensure rail networks continue operating or American consumers and global food security will pay for it.”
With 98% of all apparel, footwear, and travel goods sold in the U.S. today being imported, our industry’s 3 million American workers depend on a smooth supply chain. Rail, particularly intermodal, is an increasingly important piece of the puzzle as we work to bring the right clothes, shoes, and accessories to American families at the right time, and at the right price.
While trucking and rail companies compete for ground freight, trucking is also the largest customer of the rail industry, and both industries rely on one another to keep our supply chains healthy and efficient. We deliver the last mile of virtually every product that rail transports. Particularly through “intermodal”
shipments involving containers moved by ships, railroads and trucks, the industries depend on each other to meet domestic and international demand. The Intermodal Association of North America (IANA) reports that in 2021 alone, transportation companies moved 18,435,249 intermodal units. Idling all 7,000
long distance daily freight trains in the U.S. would require more than 460,000 additional long-haul trucks every day, which is not possible based on equipment availability and an existing shortage of 80,000 drivers. As such, any rail service disruption will create havoc in the supply chain and fuel inflationary
pressures across the board.
Many passenger rail services operate on tracks owned by freight railroads. Without the freight employees on hand to operate their networks, US rail commuters will be unable to make their trips. Some passenger rail operators have already cautioned customers about service disruptions. Amtrak faces the largest impact, as it generally only owns tracks between Boston and Washington, DC, but regional and local rail services will suffer as well.Metra, which operates 11 commuter rail lines in the Chicago area, warned its customers in a statement Tuesday that “a potential work stoppage by freight railroad workers” could “directly impact” its “ability to operate most of its services.”“We want you to be aware of this issue so that you can make alternate plans for travel should a work stoppage occur,” Metra told customers.
The American Short Line and Regional Railroad Association (ASLRRA) is the non-profit trade association representing the interests of the nation’s 600 small business short line railroads that operate 50,000 miles of track, or approximately one-third of the national railroad network, originating or terminating one out of every five railcars, serving customers who otherwise would be cut off from the network and thus disconnected from the national and global economies. Short lines work with our Class I freight railroad partners to serve every aspect of our nation’s industrial, agricultural, and energy economies.
Put simply, a rail system shutdown would be catastrophic for the U.S. economy, tens of thousands of businesses, and tens of millions of consumers. It would spike inflation, cause industrial chaos, and be a terrible result for everyone involved.