WASHINGTON, DC, US — Members of the US grain industry breathed a collective sigh of relief on Sept. 15 as US President Joe Biden announced that a tentative railway labor agreement was reached just hours before a strike was scheduled to begin.
Railroads and union representatives had been in negotiations for 20 hours at the Labor Department when the tentative deal was reached, the Associated Press reported. The agreement will go to union members for a vote after a post-ratification cooling off period of several weeks.
“These rail workers will get better pay, improved working conditions, and peace of mind around their health care costs: all hard-earned,” Biden said. “The agreement is also a victory for railway companies who will be able to retain and recruit more workers for an industry that will continue to be part of the backbone of the American economy for decades to come.”
The Association of American Railroads (AAR) put out a report last week estimating that the US economy would take a $2 billion a day hit if the trains stopped moving. The AAR also noted that railroads transport 1.5 million carloads of grain each year.
The National Grain and Feed Association (NGFA) said rail moves about 25% of all US grain. The strike would have occurred as the country’s fall corn and soybean harvest was accelerating.
A prolonged strike would have left grain elevators without adequate storage space for the new crop and caused problems for grain processors both in terms of receiving raw materials and shipping end products.
It also would have dealt a severe blow to an already struggling economy weighed down by high inflation and supply chain disruptions.
The NGFA, which had been lobbying for Congress to pass legislation to keep the railways operating if the two sides couldn’t reach an agreement, praised the railways and rail union representatives for reaching the preliminary agreement in advance of the Sept. 16 deadline.
“The efficient operation of our rail network is crucial to a functioning agricultural economy,” said Mike Seyfert, president and chief executive officer of the NGFA. “NGFA members, which include 1,000 companies that handle US grains and oilseeds, commend both parties for working in good faith toward an agreement and preventing severe economic damage.
“We thank President Biden, Agriculture Secretary Tom Vilsack, Transportation Secretary Pete Buttigieg and Labor Secretary Marty Walsh for the efforts they put into reaching this agreement. We want to especially thank Secretary Vilsack for understanding the threat to the food and ag supply chain and making sure it was represented in these discussions.”
The last railway strike in the United States happened in 1992, when Congress passed legislation that ended a two-day rail shutdown.