St. Lawrence Seaway strike stalls road salt, wheat, steel cargo as winter closing nears

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A strike by unionized workers on the St. Lawrence Seaway has halted shipments of road salt, Western wheat and steel products amid the yearly rush to move the grain harvest and other key commodities ahead of the winter freeze-up.

The 350 Unifor members stopped work on Sunday after negotiators failed to reach an agreement with the St. Lawrence Seaway Management Corp., the employer that operates 13 of the 15 Seaway locks between Montreal and Lake Erie. The strikers include engineers, skilled tradespeople and supervisors.

The work stoppage has put about 100 vessels at anchor at ports and harbours along the 3,700-kilometre Great Lakes/Seaway system that connects the heart of North America with markets in Europe and Africa.

“Every day, it’s more,” said Gregg Ruhl, chief executive officer of Algoma Central Corp. ALC-T, the largest domestic ship operator on the Great Lakes, with 29 vessels. Seven or eight of these are moored waiting to move goods through the locks.

“That’s a huge impact to Algoma but it’s, more importantly, a huge impact to our customer base,” he said by phone.

Mr. Ruhl said the shipping company is losing $1-million a day in sales, and the economic impact to the overall Seaway industry, including customers, is US$110-million a day.

The strike comes as steel plants in Hamilton and elsewhere on the lakes are stockpiling iron ore pellets that arrive by ship from mines in Quebec and U.S. mines in the upper Great Lakes region. Cities throughout the system are building inventories of road salt from mines in Goderich and Windsor, Ont. And much of the recent grain harvest from the Prairies and parts of Ontario moves through the Seaway.

Shipping lines and their customers have been working to move gasoline, jet fuel, cement, canola and other goods before the locks in the Welland Canal and the St. Lawrence River close for the winter in late December. They will stay closed until late March. Trains and trucks cannot replace the capacity or reach of vessels, and the Port of Churchill in Manitoba is not prepared to replace the Port of Thunder Bay, on Lake Superior.

“The fall harvest time is always the busiest on the Seaway system,” said Chris Heikkinen, CEO of the Port of Thunder Bay, Canada’s second-biggest grain port by shipping volumes and storage capacity after Vancouver. The port continues to load grain and potash, but before long the stream of ships will end because of the closed locks downstream, he said.

“The timing is really bad for us,” said Wade Sobkowich, head of the Western Grain Elevator Association, which represents Viterra, Richardson International and other shippers of Western Canadian grain through Thunder Bay.

Grain companies that cannot deliver wheat and other crops on time face financial penalties, which are eventually passed on to farmers, Mr. Sobkowich said. And the exporters that wait until the spring could receive lower prices than are available now. This is on top of the damage to Canada’s reputation as a reliable source, he said, after a weeks-long strike in the summer closed the Port of Vancouver and other B.C. terminals.

The impact of the Seaway shutdown stretches beyond the borders of Quebec and Ontario, into the Arctic.

Groupe Desgagnés Inc. has four cargo ships en route from the North to Sainte-Catherine, Que., near Montreal. To get to Sainte-Catherine, they’ll need to go through two Seaway locks, which are not being operated because of the strike.

The ships carry vital cargo for individuals, institutions, government entities, private contractors and various other shippers, said David Rivest, president of Desgagnés subsidiary Transarctik Inc. They also carry steel scrap destined for recycling as part of an effort to clean up northern communities.

One of Desgagnés’s ships is scheduled to carry a load of construction and resupply equipment for Canadian Royalties Inc.’s nickel mine in Quebec’s Nunavik region. Even a brief delay in the ship’s schedule could jeopardize its next trip to the Arctic as ice conditions set in, he said.

CSL Group, which operates 17 ships on the Seaway, has anchored the majority of its Great Lakes-Seaway fleet. Crews are staying aboard instead of going home, in order to be ready for the restart, said Allister Paterson, the company’s chief commercial officer. Still, it will take several days to move the waiting ships through the locks when the strike ends.

“Our customers are really worried about what this means,” he said.

“We are really, really hoping that the government gets this back and running and then sorts it out while it’s running because after going through Vancouver shutting down the western gateway two or three months ago, now we’re shutting down the eastern gateway,” Mr. Paterson said.

A representative of the St. Lawrence Seaway Management Corp. did not immediately respond to e-mailed questions on Monday. In a press release on Sunday, the not-for-profit corporation said the two sides were at an impasse over wages. The federal government’s mediation and conciliation office is assisting.

Lana Payne, national director of Unifor, said there have been no talks since the strike began, and none are scheduled. A toxic workplace relationship has contributed to the difficulties in reaching a collective agreement, she said by phone.

The two sides, she said, have “very difficult labour relations in the workplace. And of course, you would see that spilling over into bargaining.”

Industry representatives, meanwhile, urged the government to ensure the company and the union are working toward a settlement, or legislate the union members back to work.

The closing of such a key infrastructure system “shouldn’t be allowed to happen,” said Algoma’s Mr. Ruhl. “You don’t solve disputes by shutting down the main artery of the marine supply chain.”

Catherine Cobden, head of the Canadian Steel Producers Association, said her members need the dispute resolved quickly. “It’s not just about getting the iron ore in. It’s about getting the steel to market,” she said.

Labour Minister Seamus O’Regan said on Monday he has urged both sides to return to the bargaining table, and added that legislation is not the right way to end the strike. Mr. O’Regan told reporters the strike is being closely watched by U.S. officials because of the importance of the shared waterway.

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