A possible union strike at the busy Port of Montreal would affect supply chains in Canada, which could have ripple effects for the promo industry there that’s already been beleaguered with COVID-caused delays this year.

The port, located on the St. Lawrence River in Montreal, is Eastern Canada’s largest. But in recent weeks, talks between the Canadian Union of Public Employees (CUPE, Local 375), which represents longshoremen at the port, and the Maritime Employers Association (MEA), representing shipowners and operators, have been deadlocked.

The two parties’ seven-month truce ends March 21. If an agreement is not reached before that date, the longshoremen could strike.

The port handled 35 million metric tons of goods last year alone. The Montreal Port Authority added that the port is indispensable for the movement of imports into Canada, including critical medical supplies used to treat COVID-19. MedTech Canada, a national association that represents the medical technology industry, said dialysis solution would also be stuck at port if a strike were to happen, which would put dialysis centers across the country at risk of not having crucial supplies for treating patients.

Supply Chain Under Pressure

Already, shipping companies are rerouting cargo to Halifax and Vancouver. While U.S. ports could be another alternative, that’s proved difficult during the pandemic, Karl-Heinz Legler, general manager of Rutherford Global Logistics, told The Loadstar, a news outlet for the supply chain industry. Plus, the rail cars required to then carry cargo from alternative ports to their destinations across Canada aren’t always immediately available, he added. CN Rail has already announced they won’t be loading Montreal-bound cargo from ships diverted to Halifax.

Port of Montreal

“The Government is keenly aware of the central role that the Port of Montreal plays in movement of goods across Canada, particularly in Quebec and Ontario,” said Minister of Labour Filomena Tassi, in an official statement. “Reaching an agreement at the bargaining table is in the best interest of workers, unions, employers and all Canadians. We strongly encourage both parties to immediately do the hard work necessary to reach an agreement. The Government of Canada will continue to be there throughout the negotiations to support their efforts.”

According to the Globe & Mail, more than 15 business groups, including the Canadian Vehicle Manufacturers’ Association and the Canadian Produce Marketing Association, sent a letter on March 10 to Minister Tassi and Omar Alghabra, federal Minister of Transport, to insist that the government “use all tools at its disposal” to make sure an agreement is reached.

“They have to look at ways of ensuring that the parties are brought together and that a disruption is avoided,” said Canadian Chamber of Commerce President Perrin Beatty, a signee of the letter. “The cost to the economy at this point when we are still being so badly affected by COVID would simply be too great.”

Meanwhile, Canadian agricultural organizations, like the Canadian Special Crops Association, Grain Farmers of Ontario, Prairie Oat Growers Association and others, have launched a #StoptheStrike campaign on social media and website to urge Ottawa to help mediate talks.

There’s been ongoing tension between the CUPE and MEA, mainly over working hours. Their previous agreement expired on Dec. 31, 2018. Last summer, a work stoppage and revolving strikes for almost 20 days resulted in container ships being diverted to already-congested ports and cost wholesalers $600 million, said the government, and it took more than three months to take care of the backlog. Ministers from Ontario and Quebec said at the time that 19,000 jobs depend on the port being open for operation.

Ripple Effects Across North America

While products like oil, fertilizers and iron ore make up the majority of arriving goods at the port, companies in Canada rely on it for delivery of essential products like medical supplies, food and textiles as well. The Canadian International Freight Forwarders Association (CIFFA) is concerned about the impact a strike would have on the entire Canadian economy.

“We have still not fully recovered from the strike in the port last August,” CIFFA Executive Director Bruce Rodgers told The Loadstar. “Another interruption will really stick a knife in the Canadian economy. … If the strike goes ahead, we’ll see delays and lost business at a very significant level.”

Canadian promo firms that spoke with ASI Media this week haven’t yet felt the immediate impact of a looming strike. Christine Courtemanche, vice president of Lineaire Infographie Inc. (asi/253727) in Laval, QC, said her orders are mostly shipped by air. Rob Spector, president of Top 40 supplier Spector & Co. (asi/88660) in Saint-Laurent, QC, said their goods come in through Vancouver, Canada’s largest port. But that location too has been experiencing congestion for months. As of the week of March 8, 15 ships were anchored offshore waiting for open berths, according to shipping news outlet Splash247.

If a prolonged strike does occur, the promo industry could experience increased supply chain stress just as reopenings begin across the country and businesses try to recover from the pandemic. “All our containers have already arrived for this spring/summer season,” said Ron De Moor, president of DML Creation (asi/48031) in St. Jerome, QC. “We don’t see this strike affecting us at this time, unless it’s not resolved quickly.”

Any added delays at the Port of Montreal could exacerbate what’s been a frustrating year of supply chain snags for the industry. Ongoing increases in shipping costs and raw material prices, including fuel and goods, along with a lack of available shipping containers, prolonged dwell times (time that a container ship spends at port) and personnel shortages because of COVID, have created a perfect storm of concerns for promo companies importing products from overseas.