Crop and Car Shipments Set to Halt on US Rail-Strike Threat

US railroads are poised to stop shipments of farm products and other key goods starting Thursday as the industry braces for a possible labor strike that could cost the world’s biggest economy more than $2 billion a day.

Norfolk Southern Corp. plans to halt unit train shipments of bulk commodities on Thursday ahead of a potential freight strike the following day. The railroad also said it would stop accepting automobiles for transit at its facilities starting Wednesday afternoon. Other freight railroads are likely to follow suit, according to one agriculture group.

“We are hearing several rail carriers are tentatively planning to wind down shipments,” said Max Fisher, chief economist at the National Grain and Feed Association, which represents most US grain handlers.

A halt to shipments of grains, fertilizer, fuel and other crucial items threatens to hobble the US economy at a time of rampant inflation and fear of a prolonged global economic slump. Food-supply chains are especially at risk as farmers are gearing up for harvest and need to get their supplies to customers. Crops are in high demand due to shortages from the war in Ukraine and weather woes across the globe.

Prices for corn for loading into barges along the Mississippi River were rising Wednesday, as demand to ship grain on the water increases. That could accelerate as the harvest gets going over the next month.

“Our members rely on about 27 million bushels of corn and 11 million bushels of soybean meal every week to feed their chickens,” said Tom Super of the National Chicken Council. “Much of that is moved by rail.”

Wheat shippers also are heavily dependent on rail transportation. The spring variety of the grain, used to make foods like bagels and pizza dough, is now in the final stretch of harvest.

“It isn’t practical, feasible or even possible to shift US wheat movements to an alternate mode of transport to supply it where it needs to go daily,” said Justin Gilpin, chief executive officer of Kansas Wheat. “Both sides in these negotiations have to come to terms, it’s an absolute imperative for the agriculture economy.”

Tags: USA