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Issue #587

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2014 Media Kit
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U.S. railways slow to a crawl on Chicago snarl-up

By: | at 11:04 AM | Channel(s): Intermodal  

Extreme winter weather and increased congestion have slowed rail shipments on large parts of the U.S. network to a crawl since the start of the year, prompting farmers and other rail users to complain.

“(We) are growing increasingly concerned about the deterioration in service that is now occurring over significant areas of your system,” regulators at the Surface Transportation Board (STB) wrote in a letter to Burlington Northern Santa Fe (BNSF) railroad at the beginning of February.

Farmers have blamed increased oil shipments and poor service by the railroads and have pressed regulators to intervene. But extreme winter weather, more than anything, has caused the backlog, which will probably last several more months.

The STB, which monitors railroad services and fees, also sent a letter to Canadian Pacific (CP) at the start of March to demand an explanation for the delays and an action plan to restore acceptable customer service.

Rail operators acknowledge the problem, particularly in the Midwest and in the northern plains states, citing bad weather, rising oil shipments and a bumper grain harvest.

“BNSF’s service in the fourth quarter of 2013 and the first quarter of 2014 has fallen short of our customers’ expectations,” the railway admitted to the STB.

Rail cars moving grains and sugar beet have been affected particularly badly. The railroads are still struggling to restore service even as the weather improves.

At the end of March, BNSF still had more than 16,000 agricultural cars past due, averaging over 21 days late, according to its report to the STB. Delays are especially widespread in North Dakota, where almost 8,000 rail cars were past their due date.

Railroads and regulators monitor performance using a number of indicators including average train speed and the length of time that rail cars spend at terminals before being hauled on the rails or released to customers.

On both measures, BNSF and CP’s performance has deteriorated significantly over the last 12 months. BNSF’s average train speed is down from over 25 miles per hour to under 21. CP’s average dwell time has surged from 6 hours to more than 10. (Charts 1 and 2)

With trains moving slowly and more rail cars tied up in rail yards, there is an acute shortage of locomotives, rail cars and train crews and a growing wait for service.

Matters have been made much worse by repeated bouts of extreme cold weather and heavy snowfall during the “arctic vortex” in January and February, which has snarled up traffic around Chicago.

CHICAGO RAIL HUB

Chicago is the largest rail hub in the United States, with 25 percent of all U.S. rail traffic passing through the city’s rail network and rail yards.

Nearly half of all intermodal shipping containers pass through Chicago, including 54 percent of all intermodal units bound to and from Seattle and 26 percent of containers heading to or from the ports at Los Angles and Long Beach.

In 2012, Chicago’s 78 rail yards covered 16,000 acres, and its network handled 1,300 trains and 37,500 rail cars every day, according to a presentation given to the North American Rail Shippers Association.

But Chicago’s rail system was badly affected by the extreme cold weather, and delays there have been among the worst on the system. Canadian Pacific reported delays spiking to almost 40 hours on average in late February, and the backlog has still not cleared. Other railroads have fared even worse (Chart 3).

The snarl-up around Chicago has been creating a giant bottleneck for the entire Midwest and northern plains area.

The extreme cold in January and February during the harshest winter in 65 years forced railroads to shorten trains, Canadian Pacific told the STB.

“When temperatures are as bitterly cold as they have been, we must take steps such as reducing train length to keep air brakes functioning safely and properly,” it said.

Changes in train layout and loading added to the backlog. “The resulting heavy switching and backlog of manifest traffic, together with an overall increase in (oil) unit train traffic via Chicago has resulted in substantial, sustained delays for any traffic moving to or through the Chicago,” CP explained to the regulator.

This is not the first time that bad weather has caused lengthy delays at the Chicago hub. In January 1999, a blizzard tied up freight traffic for months.

In a bid to solve the problem, the city’s rail industry established the Chicago Transportation Coordination Office, which brings together representatives from all the major railroads operating in the city and is meant to maintain “liquidity and velocity” in the hub yards.

But since Jan. 6, the coordination office has declared an Alert Level 3, its most severe warning, based on poor weather conditions and the exceptional stress on the rail yards.

The backlog will eventually clear, but past tangles have taken weeks and months to clear once the weather that caused them is over. The current recovery is proving no different.

Even when the overall situation improves, some customers will continue to experience lengthy delays for weeks or even months yet.

By John Kemp

(Views of John Kemp are not necessarily the views of AJOT or Rueters)