First-Ever Simultaneous Halt of Rail Service from Both Class 1 Railways Catastrophic for Canada

OTTAWA, ON, Aug. 22, 2024 /CNW/ - Today, the Mining Association of Canada (MAC) expresses serious concern about the damaging impacts of the first-ever, simultaneous halt in service from Canada's two Class 1 Railways.

The impacts of the latest disruption extend beyond the inability of mining companies to transport products to and from domestic and international customers and suppliers to Canada's ambitions to supply minerals and metals to the world, particularly as the race for critical minerals intensifies.  

"As the single largest industrial customer group of Canada's railways, the mining sector has seen first-hand how detrimental unpredictable work stoppages are to Canada's reputation as a reliable trading partner," said Pierre Gratton, MAC's President and CEO. "The urgent need for Canadian minerals and metals presents a generational opportunity, and we are in a race with our competitors to meet global demand. A first-ever, simultaneous halt in Canadian Pacific Kansas City Railway Company (CPKC) and Canadian National Railway Company (CN) rail service could not come at a worse time."

Canada's strength in mining rests on its ability to produce and process minerals competitively and to transport products efficiently to and from domestic and international markets. The production, processing and transportation activities form the base that allows the industry to stay globally competitive.

For more than a decade, crude and processed mineral products have made up more than half of the total freight volume transported by rail in Canada. In 2022, the total freight volume was 283.6 million tonnes, of which 132 million tonnes was crude minerals, and 28.3 million tonnes was processed mineral products. This means that crude and processed minerals made up more than 56% of the total freight volume in Canada.

"The mining industry is the Canadian rail system's most significant customer, and the majority of our products are shipped to international customers. Work stoppages bring immense additional operational costs to businesses and reduce confidence in Canada as a destination for investment for supply-chain reliant businesses, such as mining," added Gratton.

Over the last several years, Canada has witnessed an unprecedented level of disruption in its supply chain through labour actions by railway and port workers, the pandemic, and civil disruption in the form of random and sporadic rail blockades. The reliability and reputation of Canada's supply chain continues to deteriorate.

"MAC has been underscoring for years that the reliability of the supply chain is a significant determinant for mining industry investment given the volume of mineral and metal products transported in Canada," concluded Gratton. "Canada can and must do better at creating a stable and predictable logistics supply chain that restores greater confidence in Canada's reliability as a trading partner and the government should make every effort and use every tool at their disposal to address this unprecedented disruption. Failure to do so is an abdication of leadership and an abandonment of responsibility."

For more information related to the mining, transportation and trade, and its associated policy recommendations, visit: https://mining.ca/resources/reports/facts-figures-2023/

The mining industry is a major sector of Canada's economy, contributing $161 billion to the national GDP and is responsible for 21 percent of Canada's total domestic exports. Canada's mining sector employs 694,000 people directly and indirectly across the country. The industry is proportionally the largest private sector employer of Indigenous peoples in Canada and a major customer of Indigenous-owned businesses.

About MAC

The Mining Association of Canada is the national organization for the Canadian mining industry. Its members account for most of Canada's production of base and precious metals, uranium, diamonds, metallurgical coal and mined oil sands, and are actively engaged in mineral exploration, mining, smelting, refining and semi-fabrication. Please visit www.mining.ca.

SOURCE The Mining Association of Canada

For more information, please contact: Geoff Smith, Vice President, Government Relations, 613.294.3173 294.3173, [email protected]