Canada Warns of Freight-Rail Delays of 'Many Weeks'

By Paul Vieira 

OTTAWA -- Canada's Transport Minister said Wednesday the country was "many, many weeks" away from a return to normal for freight-rail traffic, after police this week dismantled a blockade that had choked off shipments from east to west.

Marc Garneau told reporters in Ottawa the blockade, set up in an indigenous community roughly 120 miles east of Toronto, has "definitely slowed things down" and warned consequences may not be realized for months. The blockade affected the main east-west corridor operated by Canadian National Railway Co., the country's largest railroad.

"The effect of these blockades are very serious," Mr. Garneau said. "There is an inertia in the system. There have been companies that have virtually stopped their operations. There are 50 ships on the Pacific Coast waiting to pick up grain."

His comments came after the Ontario Provincial Police moved Monday to dismantle a blockade led by indigenous anti-pipeline protesters that lasted for more than two weeks, and threatens to weigh markedly on growth in the first quarter.

The blockade was established in solidarity with some indigenous leaders opposed to the construction of a natural-gas pipeline in British Columbia, Canada's most-western province. Another blockade remains in place near Montreal on indigenous territory, on track owned by Canadian Pacific Railway.

Canadian Pacific said Wednesday it has obtained a court order in Quebec to have the blockade removed. The blockade "has severed vital rail connections and severely impacted CP's operations, customers and the broader economy," a spokesman said.

Anti-pipeline protesters on Tuesday launched additional temporary rail blockades across the country affecting, among others, commuter-rail traffic serving suburban Toronto. The blockades later dissipated.

Economists on Wednesday said the blockades' effects would subtract from growth in the first quarter of 2020, citing data that indicated a sharp 7.4% decline in Canadian freight-rail traffic in February compared with the previous month. One economist, Derek Holt of Bank of Nova Scotia, predicted the Bank of Canada would cut its main interest rate next week because of the damage from the rail blockades and the coronavirus epidemic.

On Wednesday, a video posted on Facebook by a media outlet affiliated with protesters showed demonstrators on the tracks, one carrying a gas can, and refusing to move as a Canadian National Railway train approached. The protesters left the track with seconds to spare before the train would have struck the individuals, with at least one throwing debris. Police officers stood on the other side of the tracks and watched.

Another video, broadcast by Canada's CTV News, showed a wooden pallet burning next to the tracks as the train passed, with one protester pouring gas on the tracks.

Mr. Garneau described what the protesters did Wednesday as "an extremely reckless act." He added what transpired could have become a dangerous situation had the train been carrying dangerous goods.

Representatives for Canadian National -- which owns the track subject to the blockade east of Toronto -- didn't respond to questions about the dangers posed by protesters, or to comments from Mr. Garneau about when rail-freight traffic returned to normal.

Write to Paul Vieira at [e-mail]

(END) Dow Jones Newswires

February 26, 2020 16:56 ET (21:56 GMT)

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