The Surface Transportation Board last week issued a new directive requiring BNSF Railway and Canadian Pacific Railway to provide detailed reports on their plans to eliminate backlogs of grain shipments, and to submit weekly reports until the problem is resolved, the American Soybean Association said.
The directive follows an early spring request that the two companies provide progress reports to the STB on shipments of chemical and fertilizer, which were delayed mostly in the upper Midwest and Great Plains but as far south as Texas.
The companies testified in front of the STB on the slow deliveries in April, citing growth in oil and gas shipments, bumper crops of corn and soybeans and severe winter weather conditions as compounding reasons for backlogs and service problems.
Going forward, one concern for farmers and grain shippers, says ASA, is that the industry is now facing the start of wheat harvests, which can draw off some grain hoppers this summer. Corn and bean shippers, ASA says, could be scrambling for enough cars and locomotives right up to the next fall harvests.
The STB directive also addresses the issue, noting, "Although the data submitted by both railroads indicates some initial progress toward reducing their grain car order backlogs and grain car delays, the Board remains very concerned about the limited time period until the next harvest, the large quantities of grain yet to be moved, and the railroads' paths toward meeting their respective commitments."
BNSF and CP were ordered to provide a timeline and a plan to address the issues by Friday. In its first report, BNSF outlined several short-term actions, including hiring and training 405 new train, yard and engine employees to work on the Northern Tier, and adding 200 locomotives since the beginning of 2014.
BNSF also outlined its 2014 capital investment plan – the largest in the company history at more than $3.2 billion – to bring 500 new locomotives and 5,000 cars online.
In terms of a timeline, BNSF said, "our goal remains to remove the backlog of past due orders from the last harvest prior to the start of the new harvest in the fall."