WASHINGTON — US agriculture breathed a collective sigh of relief on Sept. 15 as President Joe Biden announced that a tentative railway labor agreement was reached just hours before a strike was scheduled to begin.

Railroads and union representatives had been in negotiations for 20 hours at the US Department of Labor when the tentative deal was reached, the Associated Press reported. The agreement will go to union members for a vote after a post-ratification cooling off period of several weeks.

“These rail workers will get better pay, improved working conditions, and peace of mind around their health care costs: all hard-earned,” Biden said. “The agreement is also a victory for railway companies who will be able to retain and recruit more workers for an industry that will continue to be part of the backbone of the American economy for decades to come.”

The sticking point in negations with the unions was more conditions in the contract that cover vacation and sick and emergency medical leave. 

The Association of American Railroads (AAR) put out a report last week estimating that the US economy would take a $2 billion a day hit if trains stopped moving. The AAR also noted that railroads transport 1.5 million carloads of grain each year.

The National Grain and Feed Association (NGFA) said rail moves about 25% of all US grain. The strike would have occurred as the country’s fall corn and soybean harvest was accelerating.

A prolonged strike would have left grain elevators without adequate storage space for the new crop and caused problems for grain processors both in terms of receiving raw materials and shipping end products.

It also would have dealt a severe blow to an already struggling economy saddled with high inflation and supply chain disruptions.

The last railway strike in the United States occurred in 1992, when Congress passed legislation that ended a two-day rail shutdown.

Read more about supply chain topics affecting the industry on our Operations page.