Insights

The Golden Week holiday created a temporary pause to the volume declines and subsequent rate freefalls the market has been experiencing over the last couple of months. Import volumes are expected to continue to drop, however ocean carrier blank sailings and service suspensions should help slow the decline, at least for USWC local port destinations.

This morning the U.S. Labor Department announced that the rail companies and union negotiators came to a tentative agreement that “balances the needs of workers, businesses and our nation’s economy.” A USA Railroads strike had been called to begin starting 0001 hrs. Friday September 16. The tentative agreements announced this morning follow the Aug. 16 recommendations of Presidential Emergency Board (PEB) No. 250, which include a 24 percent wage increase during the five-year period from 2020 through 2024 — with a 14.1 percent wage increase effective immediately — and five annual $1,000 lump sum payments, the National Railway Labor Conference said in a statement.

A strike at USA Railroads has been called to begin starting 0001 hrs. Friday September 16. There are a total of 12 unions currently negotiating with the nation’s Class I railroads and not all have reached agreement yet on new contracts. Eight out of a dozen railroad unions have accepted tentative agreements with carriers, while the remaining unions would be able to legally strike after a cooling-off period ends Sep 16. The strike, if implemented, will impact all railroads including CN, Norfolk Southern, CSX, CP, BNSF, and UP. Sources indicate that the unions are preparing to strike, starting at midnight on Friday, Sept. 16, if new contracts are not completed and approved.