STB issues order to resolve backlog of grain car shipments

By Erin Voegele | June 24, 2014

The Surface Transportation Board recently took action to help ensure the Canadian Pacific Railway Co. and BNSF Railway Co. resolve the backlog of grain car orders prior to the fall harvest. On June 20, the STB issued an order directing CP to report its plan to resolve the backlog of grain car orders on its U.S. network, including its timeline for doing so and its plan for ensuring a fluid and reliable interchange of loaded and empty grain cars with Rapid City, Pierre & Eastern Railroad Inc. Similarly, BNSF is directed to report an updated plan to resolve the backlog of grain car orders on its network, including a timeline for doing so. Both plans must be filed by June 27. Moving forward, both companies will be required to provide the STB with weekly status reports regarding the transportation of grain on their respective networks.

The order released by the STB notes that that it held a hearing on April 10 to address the issue of rail congestion and delays.  Representatives of the Renewable Fuels Association and Growth Energy were among those that testified at that hearing. 

“During the hearing, farmers and representatives of agriculture producers described severe, negative effects resulting from backlogged grain car orders and delayed shipments of loaded grain cars. The reported impacts included, for example, elevators running out of storage capacity, risks of stored grain spoiling, and penalties incurred by grain shippers for products that are not delivered on time,” said the STB in its June 20 order.

Since the hearing, the STB said BNSF and CP have provided data on a regular basis regarding the status of their operations and their progress resolving ongoing service issues. According to the STB, BNSF has described its plans to add employees, locomotive and make additional capital investments. CP’s public submissions to date, however, have not as clearly articulated plans to resolve grain car order backlogs in the near term.

“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,” said the STB in its order.

This is not the first time this year the STB has issued an order with the goal of mitigating the impact of rail delays on the agricultural industry. Earlier this year, the STB took action to ensure CP and BNSF delivered fertilizer shipments in time for spring planting.