Biden announces tentative agreement to avoid rail strike

By Erin Voegele | September 15, 2022

President Joe Biden on Sept. 15 announced a tentative agreement has been reached between rail companies and labor unions that is expected to avert a rail strike that would have caused massive disruption in the U.S.

“I thank the unions and rail companies for negotiating in good faith and reaching a tentative agreement that will keep our critical rail system working and avoid disruption of our economy,” Biden said in a statement.

Railroads and labor unions have until midnight Sept. 15 to reach an agreement to prevent a lockout or strike that could lead to a nationwide rail shutdown. Approximately 70 percent of U.S. ethanol is shipped by rail. A shutdown of the rail system could have forced plants with full onsite storage capacity to idle operations. An inability to ship ethanol to blending terminals would have also contributed to a spike in fuel costs caused by the shutdown.

The Renewable Fuels Association and Growth Energy have spoken out in support of the tentative agreement reached earlier today.

“We are greatly encouraged to hear that a tentative agreement has been reached, and we are hopeful that a deal will be officially finalized as soon as possible,” said Geoff Cooper, president and CEO of the RFA. “This agreement means the ethanol industry—and the entire U.S. economy—have dodged a lethal bullet. A strike-related stoppage of rail service would have been catastrophic for the ethanol industry, as more than 70 percent of the renewable fuel we produce is shipped by rail. The industry also relies heavily on rail for inbound corn shipments and outbound shipments of animal feed co-products. Our nation’s ethanol biorefineries depend on safe, efficient and timely service to keep their products flowing across the country and to ports for shipment around the world. We are grateful to the Biden administration, members of Congress, the rail industry and the labor unions for working together to avert a major disaster.”

“We are pleased that a tentative agreement has been reached to avert a potentially devastating rail shutdown and we appreciate the work of all parties to keep trains and commodities moving across the country,” said Emily Skor, CEO of Growth Energy. “Nearly 70 percent of our ethanol production is moved by rail with more than 400,000 carloads shipped annually, so in order to deliver low-cost, low-carbon fuel to American drivers, timely and efficient rail service is essential.”