Slow pace of rail recovery stirs fear of future woes
"You can't see these massive increases in crude-by-rail and not appreciate that they are creating problems for moving agricultural products," Heitkamp said.
"With remaining grain in storage due to the backlog, grain elevators in some locations, such as South Dakota and Minnesota, could run out of storage capacity during the upcoming harvest, requiring grain be stored on the ground and running the risk of spoiling. The projected size of the upcoming harvest creates a high potential for loss," USDA Under Secretary Edward Avalos wrote to the regulator this month.
Utility Xcel Energy said coal deliveries to a key Midwest facility were behind schedule.
"When we run out of coal, the plant can't produce electricity. We are right in the middle of summer when air-conditioning load creates our highest levels of electric demand," Xcel Chief Executive Ben Fowke wrote in a letter to the STB at the end of July.
Since an April 10 hearing on rail service, the STB has issued several orders, primarily involving CP and BNSF. The most recent directive, issued in June, required the two railways to publicly file their plans to resolve their backlog on grain orders and provide a weekly update on grain car service. It declined to comment on complaints or its plans.
Earlier this month, the Canadian government ordered Canadian National Railway Co and CP to further boost regulated grain shipments, in an effort to prevent a repeat of last season's backlog.
Recent University of Minnesota data showed that transportation bottlenecks cost the state's soybean, corn and spring wheat farmers nearly $100 million between March and May.
United Parcel Service Inc, the world's largest courier company, said that "very poor" railroad performance last quarter raised its costs. Even passenger service Amtrak has been affected, with some of the trains it runs on Class 1 tracks falling far behind schedule.
CN said its ability to avoid Chicago, a hub notorious for bottlenecks, helped its sector-leading recovery. In 2009, CN bought a rail network that encircles Chicago, the Elgin, Joliet and Eastern Railway Co.
Chicago's third-snowiest winter on record severely tangled traffic at a hub that handles one quarter of the nation's freight-by-rail and has recently become a major conduit for Bakken crude.
Data from Union Pacific shows its trains idled in Chicago for an average 65 hours in February, around double the typical time for much of 2013.
Following a severe 1999 blizzard that paralyzed trains for days, government and railroads launched a $3.8 billion plan to improve the Chicago system.
That's not a quick solution for the industry's woes.
"It takes a long time for new lines and new terminals to get built, and additional locomotives to be delivered and additional crews to be trained," said Steve Ditmeyer, an adjunct professor at Michigan State University's Railway Management Program.
"There's a time lag that the railroads cannot snap their finger and, all of a sudden, get out of the current problem."
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