What rail strike would mean for Seattle shippers, sellers and shoppers

With the prospect of a national rail strike starting just after 9 pm Thursday, businesses and residents in Seattle and across Washington are preparing for yet another blow to a supply chain that was only just starting to heal from the pandemic.

Some analysts think the federal government would quickly try to end any strike by unions representing tens of thousands of railroad workers against BNSF, Union Pacific and four other freight lines over wages and working conditions. The strike would halt nearly all rail traffic in the United States.

But an extended walkout by engineers, conductors and other workers could have broad economic impacts on everything from Eastern Washington agricultural exports and shipments of parts for Boeing airplanes to Seattle-area new car sales to whether the shelves at local retailers are full or empty, experts and businesses say.

“Supermarkets are the ones I’m most worried about, because supermarkets are still suffering from large out-of-stocks” from earlier in the pandemic, said Jeff Green, a retail analyst with Hoffman Strategy Group who follows the Seattle market.

The Northwest Grocery Association said member grocers were preparing for a possible strike and urged “shoppers not to stockpile” and to “purchase only what they need and leave the rest for their neighbors and friends,” according to a Wednesday statement.

The threatened strike is also hitting human cargo: Amtrak has already canceled its Cascade trains, as well as long-distance routes — among them, the Seattle-to-Los Angeles Coast Starlight route and the Seattle-to-Chicago Empire Builder — because the routes use tracks owned by strike-affected freight rail companies, a spokesperson said Wednesday.

And Sound Transit said Wednesday it would cancel Sounder commuter rail service between Everett, Lakewood and Seattle on Friday if the strike goes ahead.

Businesses are especially worried about a strike’s effect on other links in the supply chain.

Although rail accounts for barely a quarter of the nation’s freight volume, much of the rest of the supply chain, including ports, truck fleets and warehouses, would struggle to operate without it.

“We won’t be able to pick up or drop off [cargo] containers from the rail yards until the conductors come back to work,” says Lisa Clark, an independent trucker who typically takes incoming shipments of beer from a Sodo rail yard to warehouses in Kent and Everett. “All of my work is from the rail, so after this week, I’ll probably be sitting at home.”

Compounding the potential snags, many desperate shippers may try to reroute rail cargo to truck transport. But such moves could quickly overwhelm local and national trucking fleets, which were already short drivers, trailers and parts.

And even before COVID-19, the trucking industry lacked the capacity to take more than a fraction of rail’s volume. To carry all the freight now moved by US railroads would require nearly half a million extra trucks, according to the Association of American Railroads, an industry group.

But even a small shift from rail to trucking could slow deliveries and boost prices — even for shippers that normally use trucks. “We would end up paying much more to ship products anywhere — if we were even able to get a trucker to move product for us, that is,” said Bryan Gonzalez, with FC Bloxom & Co., a Seattle-based agricultural export firm .

Gonzalez worries about “a cascading domino effect that would impact the entire supply chain in potentially nightmarish ways.”

An extended work stoppage could also bring back the backlog of idled cargo ships and the mountains of 40-foot cargo containers that clogged US ports, including in Seattle and Tacoma, last year.

That could mean delays of imported products, just as many retailers are stocking up for the holidays.

It’s also potential bad news for exporters — among them, many Washington farmers now harvesting crops and preparing products to be shipped.

For Ellensburg-based Anderson Hay, new backups at the port of Seattle could mean delays in getting cargo containers of hay aboard ships headed for overseas buyers, said Mark Anderson.

And because Anderson also ships a lot of hay to domestic buyers, mainly by rail, a strike “will back all of that up,” said Anderson, who notes that the strike threat comes just as last year’s supply chain problems were starting to unsnarl.

“It’s already a pretty fragile system trying to come back together,” Anderson said. Any new “interrupt would be devastating.”

For Seattle-area consumers, meanwhile, any strike impacts could take days to show up in the form of product outages, assuming a strike lasts that long.

A strike “could halt auto deliveries for all brands,” said Mitch Tramm, with Gilchrist Chevrolet Buick GMC in Tacoma. It would be a “major issue.”

Clark, the trucker, isn’t worried about immediate beer shortages: Local warehouses have plenty of suds on hand, she said, but added that “if it drags on, it will be noticeable.”

One big uncertainty: the impact on grocery retailers, which often have limited on-site inventory storage and rely on steady deliveries to keep shelves full.

The grocery association statement said that a national strike would affect its grocers’ supply chains “depending on their reliance on rail compared to truck,” but an association official acknowledged the strike’s potential spillover effects on trucking “is a fair concern that all are currently assessing .”

But like nearly every other business locked into the supply chain, grocery stores and other retailers are challenged in knowing how to prepare for a strike whose imminence and duration are unknown, says Green, the retail analyst.

While stores will be anxious to avoid any new “out-of-stocks, because that in itself breeds panic,” Green said, “my gut is they don’t really know what to expect.”

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