Plans by the world’s largest ag inputs provider to temporarily idle its biggest potash mine in view of the Canadian National Railway strike will proceed, even as CN goes back to work.
Saskatoon-based Nutrien announced Monday it “will be forced to curtail production” at its Rocanville, Sask. mine due to the CN rail strike.
The company said it had served employees with notice that day, stating the mine will shut down for two weeks starting Dec. 2. Over 500 employees would be temporarily laid off, according to media reports Monday.
“It is extremely disappointing that in a year when the agricultural sector has been severely impacted by poor weather and trade disputes, the CN strike will add further hardship to the Canadian agriculture industry,” Nutrien CEO Chuck Magro said Monday in a release.
Most concerning, he added, “is the impact on our hundreds of employees for whom this creates great uncertainty and hardship leading up to the holiday season.”
CN and its conductors’ and yard workers’ union, the Teamsters Canada Rail Conference, announced Tuesday they’ve reached a tentative agreement to end the eight-day strike by over 3,000 employees and would resume work that day.
However, “unfortunately, we’re still going to have to complete the two-week downtime” at Rocanville, Jeff Holzman, Nutrien’s senior director for investor and corporate relations, said Tuesday afternoon.
Given the eight-day halt in rail traffic, the downtime at Rocanville is still necessary “to get our system back in balance,” he said.
Nutrien, he added, is “obviously” happy the strike has ended, which will “prevent further issues” in the company’s supply chain.
The Rocanville mine, about 100 km northwest of Virden, Man., is Nutrien’s largest single producer with nameplate capacity for 6.5 million tonnes of red potash per year. Its “operational capability” for 2019 is listed at 5.4 million tonnes.
The mine is connected to CN’s mainline west of St. Lazare, Man., and to Canadian Pacific Railway (CP) track near Rocanville.
Nutrien had already announced in mid-September it would “proactively” take inventory shutdowns of up to eight weeks at its Allan, Lanigan and Vanscoy, Sask. potash mines during the fourth quarter, “in response to a short-term slowdown in global potash markets.”
Idling the three sites for the full eight weeks would cut Nutrien’s 2019 potash production by about 700,000 tonnes and cut the company’s annual EBITDA (earnings before interest, taxes, depreciation and amortization) on potash by US$100 million to $150 million, the company said at the time. — Glacier FarmMedia Network