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Longshoremen with the ILWU strike at Canada's busiest port, in Vancouver, on July 1.CHRIS HELGREN/Reuters

A strike hitting ports across British Columbia is raising concerns that an extended walkout could have an inflationary impact in Canada as the labour action disrupts supply chains and global shipping.

About 7,400 members of the International Longshore & Warehouse Union Canada (ILWU) walked off the job on Saturday, 72 hours after the waterfront union served its strike notice. The strike has led to the suspension of imports of consumer goods and most exports of raw materials.

A crucial issue at the bargaining table is the workers’ future job security amid a plan to build a $3.5-billion, semi-automated container terminal near the Vancouver suburb of Delta.

“For the future of our work force, we had to take this step,” ILWU president Rob Ashton said in a statement.

Besides worries about automation, the union’s other main concerns are familiar at the bargaining table: disputes with employers over contracting out and disagreements over what constitutes a fair cost-of-living wage increase.

About 6,000 of the ILWU’s members are in the Vancouver region, 1,000 in the Prince Rupert area and the rest in Nanaimo and Port Alberni.

“Any disruption to port operations has a significant impact globally and on Canadians who rely on the businesses that import and export goods,” the Vancouver Fraser Port Authority said. Canada’s largest port estimates that one-third of the value of Canadian trade in goods outside of North America gets handled by the various terminals in the Vancouver region.

With consumers already facing high prices, if the labour dispute is prolonged, the extra cost of congested ports threatens to place further inflationary pressure on imported goods that arrive by ship and get transferred to trains and trucks, according to business advocacy groups.

The Canadian Federation of Independent Business is among the groups warning about shipping delays potentially creating chaos as imported goods such as perishables, appliances and electronics move from the West Coast, across the Prairies and into Central Canada.

“Some businesses may lose inventory if perishable goods are not unloaded and brought to market quickly,” the federation’s vice-president of national affairs, Jasmin Guénette, said in a news release.

On the export side, Canadian shipments of a wide range of raw materials such as fertilizer and lumber have been suspended. An array of different materials are transported in a variety of ways, including bulk shipments loaded onto vessels or inside reusable steel containers.

Federal Labour Minister Seamus O’Regan arrived in Vancouver on Friday and met separately with both sides in the dispute. He plans to stay in Vancouver while the ILWU and the BC Maritime Employers Association try to hammer out a deal.

So far, attempts to reach a pact with the assistance of federal mediators have not succeeded. The previous five-year collective agreement expired on March 31.

The Canadian Chamber of Commerce is calling on the Liberal government to recall Parliament. But in an e-mailed statement on Sunday, Mr. O’Regan’s office responded: “We are not looking past the bargaining table, because the best deals are made at the table. Federal mediators continue to support the parties in their negotiations.”

Automation has emerged as a crucial issue, growing in importance after the federal government approved the Vancouver Fraser Port Authority’s proposal to build a $3.5-billion container terminal, which would be semi-automated.

In April, the government cleared the way for construction of the Roberts Bank Terminal 2 project, or RBT2, that would be located on an artificial island to be built near the Vancouver suburb of Delta.

Mr. Ashton has sounded the alarm over the anticipated magnitude of automation to load and unload cargo, arguing recently that RBT2 would result in many “jobs being done by robots.”

The port authority has yet to select RBT2′s terminal operator, which would have the final say over the number of jobs to be created. The port authority has said it will make it a condition of the selection process that the new terminal operator commit to employing at least 800 ILWU members.

But the union is worried that RBT2′s semi-automation will place pressure on existing terminal operators to install more machines and equipment to replace many duties currently done by unionized workers.

Container capacity would rise by nearly 50 per cent at Canada’s largest port when RBT2′s three berths are completed in the mid-2030s.

The union, environmental groups and one of the Vancouver Fraser Port Authority’s tenants, GCT Global Container Terminals Inc., oppose RBT2. GCT, which already operates the existing three-berth Deltaport container terminal near Delta, wants to expand by constructing a fourth berth.

The BC Maritime Employers Association represents 49 private-sector employers at more than 35 terminals spread across four port authorities in the province. Besides the Vancouver Fraser Port Authority, three other authorities oversee their respective locations in Prince Rupert, Nanaimo and Port Alberni.

Picket lines went up at terminals across B.C. over the weekend.

“Our bargaining committee has made repeated efforts to be flexible and find compromise on key priorities, but regrettably, the parties have yet to be successful in reaching a settlement,” the association representing employers said in a statement.

During a news conference on Sunday at a break from negotiations, Mr. Ashton countered that union officials have shown greater flexibility than representatives for the employers. “We do not plan to leave the bargaining table,” he said, adding that Ottawa should not impose any settlement.

Parliament is currently on a summer recess until September. While the Liberal government could recall the House of Commons to introduce back-to-work legislation, it recently showed a clear reluctance to use that option when more than 100,000 federal public servants went on strike in April.

The minority government regularly relies on support from the NDP on key votes and the New Democrats said they would strongly oppose the use of back-to-work legislation during the public-service strike.

Parliament did approve back-to-work legislation in 2021 to end a strike at the Port of Montreal. In that case, the Liberals received the support of Conservative MPs and the bill passed over the objections of the NDP and the Bloc Québécois.

Leaders at the ILWU and the group of employers said the labour dispute will not affect the servicing of cruise lines docked at Vancouver, Prince Rupert and Vancouver Island.

Bulk grain shipments are expected to continue being exported overseas, in accordance with the Canada Labour Code.

Two coal-export terminals, Westshore Terminals Investment Corp. near Delta and Trigon Pacific Terminals Ltd. near Prince Rupert, would keep operating because those employers have their own collective agreements.

With a report from Bill Curry in Ottawa

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