Canadian Port Shutdowns Underway Likely to Bring Economic Headwinds
Written by David C. Lester, Editor-in-Chief
Vancouver Fraser Port Authority
BRITISH COLUMBIA and MONTREAL –– A lockout on western Canadian ports. A strike on two eastern Candian ports. Not a good situation for early November.
Most British Columbia ports have been locked down by employers due to the threat of a strike by the International Longshore and Warehouse Union Local 514. About 700 foremen who are members of the Union are involved.
According to The Canadian Press, the Canadian Chamber of Commerce said that labor actions are happening too frequently and the world’s view of Canada as a strong partner in trade could be diminished. About 18 months ago, a different group of workers at B.C ports went on a 13-day strike, which occurred shortly after work stoppages Canadian Pacific Kansas City and Canadian National, Canada’s two largest railroads.
The ILWU Local 514 has not had a contract since March 2023.
Bridgitte Anderson, the president of the Greater Vancouver Board of Trade said that the ports shutdown could add to inflation by jeopardizing the movement of $800 million of cargo each day the strike continues.
Pascal Chan, the Chamber’s senior director of transportation, infrastructure, and construction said “Not long ago, shutting down our West Coast ports two years in a row would have seemed unthinkable. The resulting damage to trade and our economy is another blow to Canadian workers and businesses.”
Two points important to note are that 1) the shutdowns are occurring at one of the worst times of year, in early November, when the supply chain’s busy season is in full swing. With the holiday retail system about to get underway in two weeks this could degrade economic performance in the fourth quarter in both Canada and the United States. 2) The backlog created by shutdowns will grow commensurately with the length of the shutdown. And history tells us that these backlogs can often take two to three months to clear, which means holiday goods may not make it to shelves until January, which is too late.
Fraser Johnson, an operations management professor at the University of Western Ontario said “The Port of Vancouver is far and away the most significant port that we have in Canada.” He added that this port sees about 45% of Canada’s total port traffic, with Montreal seeing approximately 10%.
Meanwhile, two terminals at the Port of Montreal are shut down due a strike that began just before the end of October. This strike involves approximately 1,200 longshore workers.
