Agricultural shippers are anxiously monitoring the current contract negotiations between the National Carriers’ Conference Committee – representing the nation’s leading railroads – and a collection twelve unions representing 140,000 railroad workers. If an agreement between the two sides is not reached by 12:01 am on Friday, September 16th, a railroad strike, lockout, or slowdown is possible.
The Soy Transportation Coalition joined a large group of agricultural organizations in signing onto a letter to congressional leaders – which is linked below - urging them to intervene to prevent a lockout or strike if the two parties fail to reach an agreement by September 16th, as officials say rail service during harvest season is critical and must continue.
Negotiations between the two parties have been ongoing for a couple years, but have not resulted in an agreement. On July 15th, President Biden appointed the three-member Presidential Emergency Board (PEB) to develop a set of non-binding recommendations by August 16th for the two parties to consider. After the recommendations were released, the two parties have 30 days – concluding on September 16th – to accept the recommendations, arrive at a different agreement, or temporarily extend the current contract. Prior to September 16th, any strike or lockout is prohibited by law. However, if an agreement is not achieved, a strike or lockout starting on September 16th is possible.
The PEB recommended a 24% wage increase for railroad workers over five years. This compares with the railroads’ proposed 17% wage increase over five years and the unions’ proposed 31.3% increase over five years. The PEB recommends “service recognition bonuses” of $1,000 per year for 2020 thru 2024. The recommendations also include adjustments to health care premiums. The entire set of recommendations issued by the PEB is posted below. As you can see, page 116 provides a summary of the recommendations.
According to the Association of American Railroads, railroads annually transport 1.5 million carloads of grain – including 340,000 carloads of soybeans. In addition, 248,000 carloads of processed soybeans (primarily soybean meal and soybean oil) are transported each year.
Soy Transportation Coalition officials report being pleased with a growing number of railroad unions are tentatively agreeing to the terms of the proposed contract, but officials also caution they remain very concerned that we are days away from a potential strike or lockdown. Any slowdown or stoppage of rail service, especially on the eve of harvest, is predicted to significantly impact farmers ability to meet customer demand domestically and internationally.
According to a statement from the organization, "Given current global food insecurity, a lot is riding on the shoulders of the American farmer. As always, the American farmer is up to that task, but we need our nation’s railroads to facilitate, and not be an obstacle to, delivering soybeans, grain, and other agricultural products in a reliable manner. This reliability is currently under question. We therefore continue to urge the two parties to agree to a contract that benefits railroads, railroad workers, and especially the customers that depend upon them."