STB to hold public hearing April 26-27 on rail service delays

By Erin Voegele | April 11, 2022

The Surface Transportation Board on April 7 announced it will hold a public hearing on April 26-27 focused on recent rail service problems and recovery efforts involving several Class I carriers. Ethanol producers are among the groups currently impacted by significant rail delays.

A notice published by the STB indicates the agency has in recent weeks heard informally from a broad range of stakeholders about inconsistent and unreliable rail service. The STB also said it has received reports from the Secretary of Agriculture and other stakeholders about the serious impact this inconsistent and unreliable service is having on rail users, particularly with respect to shippers of agriculture and energy products. The STB said these reports have been validated by its weekly rail service performance data.

Growth Energy is among the groups that has reached out to the STB regarding these issues. The trade organization on April 8 sent a letter to STB Chairman Martin Oberman outlining the impact of rail service delays on the ethanol industry. According to Growth Energy, some ethanol plants have been forced to curtail production while waiting on delayed empty railcars to arrive. Delayed shipments have also impacted the ability of some fuel retailers to supply ethanol blends to their retail customers.

“During my time on the Board, I have raised concerns about the primacy Class I railroads have placed on lowering their operating ratios and satisfying their shareholders even at the cost of their customers,” Oberman said in a statement. “Part of that strategy has involved cutting their work force to the bare bones in order to reduce costs.  Over the last 6 years, the Class Is collectively have reduced their work force by 29 percent – that is about 45,000 employees cut from the payrolls.  In my view, all of this has directly contributed to where we are today – rail users experiencing serious deteriorations in rail service because, on too many parts of their networks, the railroads simply do not have a sufficient number of employees.”

The STB said it will direct executive-level officials of BNSF Railway Co., CSX Transportation Inc., Norfolk Southern Railway Co, and Union Pacific Railroad Co. to appear at the public hearing. The agency will also invite and welcome the attendance of executive-level officials from Canadian National Railway CO., Kansas City Southern Railway Co., and Canadian Pacific Railway Co. Other carriers, rail customers, labor organizations and other interested parties are welcome to report on recent service issues during the event.

The STB in 2014 began requiring Class I railroads to begin filing weekly data reports regarding service performance, including certain data on ethanol shipments. The requirements were put in place in an effort to promote industry-wide transparency, accountability and improvements in rail service following a period of similar rail delay issues, which also impacted ethanol producers.

Weekly data filed by Class I railroads over the past several weeks shows that the average dwell time at origin for ethanol unit trains on the BNSF was as high as 87.9 hours the week of March 2. CP, NS and UP also reported average dwell times for ethanol unit trains as high 56.8 hours, 76.3 hours and 53.2 hours, respectively, over the period ranging from March 2 through April 6. 

Over the past five weeks, BNSF reported that the average number of loaded ethanol cars in revenue service that did not move in 48 hours or longer averaged 631.4 to 283.1 cars over the past five weeks. For CP, NS and UP the averages ranged from 104 to 11 cars, 361.6 to 132.1 cars, and 151 to 62 cars, respectively.

For empty ethanol rail cars in revenue service over the same period, the average number of cars that did not move in 48 hours or more ranged 381.9 to 233.9 cars  for BNSF. The averages for CP, NS and UP ranged from 61 to 7 cars, 188.4 to 67.9 cars, and 103 to 31 cars, respectively.

Additional information on the hearing is available on the STB website