Posted on 09/05/2014 4:59:38 AM PDT by thackney
Edited on 09/05/2014 6:26:14 AM PDT by Admin Moderator. [history]
(Excerpt) Read more at ft.com ...
Cool. Thanks.
What percentage is it for North Dakota? National numbers aren’t all that relevant for a regional or local market.
I haven’t seen a breakdown that way yet.
Railway companies have pledged for months to improve their performance. They said that congestion on the system developed because of increased shipments of consumer goods, coal and other cargoes, not just crude oil from North Dakota.
http://www.startribune.com/business/273867031.html?page=all&prepage=1&c=y#continue
“As the new harvest ramps up, storage space at many [grain] elevators reportedly is already unavailable or very limited” because much of the 2013 corn and soybeans have not been shipped yet, the board noted. “As a result, some farmers are being forced to store grain on-site in bins, bags, or on the ground, or to truck grain to distant elevators.”
The railroads have pledged to catch up on delayed shipments, and BNSF Railway Co. has added locomotives, crews and new track in strategic areas.
“but it is Petroleum’s fault for the delays?”
The delays are caused by an increase in business in ALL commodities at the same time. We have been having problems with lumber shipments since last year when our business picked up. The problem is there are not PEOPLE and locomotives to handle the increase in business for the railroads. We are specifically seeing this with the BNSF and CPRS currently. Both of these railroads are heavily involved in the transportation of oil out of the prairies.
Last winter because of the sub zero weather in the upper Midwest, railcars sat without moving, sometimes for as long as a month in the Chicago and Twin Cities area. Again, the BNSF and CPRS were the worst offenders. I had a car that sat in the Chicago suburbs for over one month. They claimed force majeur. The real problem was they did not have enough crews to physically go out and free up the switch tracks anymore. They had laid off people or did not hire as people retired during the recession.
Currently, we are dealing with a record grain harvest. There are just not enough trains and crews to move the grain that is sitting in the silos and elevators. Moving grain is similar logistically to forest products. What I mean it is like the milk run. They drop off/pick up 4 cars at one elevator, 10 at another and so forth. Then they have to group these all together to make a train load to go to Minneapolis or Winnipeg. With oil or coal the whole train starts at one place and goes to one place. It does not stop in between. It is a much more efficient use of the people and available equipment.
Meanwhile, GE and other companies are trying to make new locomotives. They can only make them so fast. Same thing goes with the three companies that make oil tanker cars. Of which Buffet owns one already.
Missouri ripped up a couple of their railways to turn them into biking trails.
A lot of spurs in Iowa were abandoned because it was uneconomical to maintain rail beds that were only used a few months in the spring and fall.
Seems like local farming co-ops would buy and maintain those.
Shoud also consider the fact that the huge shortage of truck drivers is contibuting to increased rail shipments as a viable alternative to trucking.
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