Canadian manufacturers say rail blockades across the country are hurting a key cog of Canada’s economy at a time they can hardly afford it.
New numbers from Statistics Canada released Tuesday show Canadian manufacturing sales fell for four months in a row to close out 2019, as the industry’s sales slipped to $56.4 billion in December. That was down 0.7 per cent from November’s level, which was itself down a full percentage point from the previous month’s level. Economists were expecting the industry to have grown by about 0.7 per cent — not to have shrunk by that much.
A week-long CN Rail strike last fall was a factor in the December numbers, as manufacturers saw their supply lines and ability to get finished products out to customs grind to a halt.
The motor vehicle assembly and aerospace industries were especially hard hit during the month, Statistics Canada noted. While the impact of the November rail strike may have been only temporary, it exacerbated weaknesses that were already there, RBC economist Nathan Janzen said.
“Underlying trends in the Canadian manufacturing sector were on the soft side at the end of 2019,” he said, “[and] the outlook is being clouded once again by … another round of disruptions to rail transportation via the ongoing blockade of main rail lines.”
That’s a reference to what’s happening in B.C. and Ontario at the moment, as Indigenous protestors and sympathizers have shut down a key rail line in Northern B.C. because they oppose the construction of the Coastal GasLink pipeline on the grounds that it would run through the hereditary land of the Wet’suwet’en people.
Another group has blockaded another key rail line near Belleville, Ont., in solidarity with the B.C. protest.
Those shutdowns are hitting Canada’s manufacturing sector hard, as the industry typically uses roughly 4,500 rail cars a day to ferry components and parts between suppliers, and also to ship finished products to market.
Industry group the Canadian Manufacturers and Exporters Association is holding a press event at 11 a.m. ET on Tuesday to urge lawmakers to put an end to the protests.
The group says that every day the rail stoppages continue, $850 million worth of manufactured goods are sitting idle.
“Redirecting shipments to other modes of transport is a not practical solution, as it disrupts supply chains, delays shipments and leads to added costs or penalties for missed delivery schedules and, possibly, the loss of future business to global competitors,” the group said in a release.
