Rio Tinto declares force majeure on aluminum shipments from Canada because of railway strike

According to a Platts report Rio Tinto Aluminium issued a force majeure declaration on aluminium shipments out of Canada, caused by a weeklong strike which was affecting shipments via Canadian National Railways. The strike, which began on November 19 is likely to come to an end as a tentative agreement was signed between CN and the Teamsters union to end the strike amicably.  

“this work stoppage is impacting all railcars traveling on … CN’s main lines in Canada,” according to a Rio Tinto Aluminum customer letter, signed by Dany Cloutier, manager, remelt ingot sales, Sales & Marketing – North America, and obtained by S&P Global Platts.

“This event, which is beyond our reasonable control, if prolonged, may cause significant operational difficulties at our Canadian facilities, and is currently impacting our supply chain and our ability to transport our products to certain of our customers, ports and warehouses in North America,” Cloutier wrote further.

The letter further added that the force majeure may affect Rio Tinto’s ability to deliver its aluminium shipments according to the volume and schedule decided prior to the strike. The letter emphasised that RTA would work closely with its customers to reduce the impact and reach to mutually acceptable solutions so that supply is not affected.

Cloutier wrote that RTA is “currently unable to estimate how long this event of force majeure will last, however, we expect that the supply disruption would continue past the end of the labor dispute as CN clears its backlog of shipments and our inventory levels improve.”

The company assured its customers that it would keep them updated on the effects on delivery schedules and volumes. They would, he said, also be informed when normal logistic activities resume. CN Railway serves all nine aluminium smelters in Canada and it has a network of 16 strategically located metals distribution centers for semaless logistics services.