EARLIER this year, the Surface Transportation Board (STB) began hearing from agricultural stakeholders about service problems occurring across significant portions of the nation's rail network, particularly on the Canadian Pacific Railway (CP) and BNSF Railway systems.
In response, STB sent separate letters to CP and BNSF requesting information on how each Class I railroad planned to restore its service levels, and now, it is requiring the companies to submit plans that outline how they will resolve backlogs of grain car orders.
The board held a public hearing April 10 in which farmers and producer representatives described severe negative effects resulting from backlogged grain car orders and delayed shipments of loaded grain cars, including, 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.
Since the hearing, the rail companies have provided updates, but the issues have not been completely resolved, leading STB to make its most recent decision.
"Based on concerns raised before and after the public hearing on this matter, the board is requiring (CP and BNSF) to publicly file their plans to timely resolve their backlogs of grain car orders as well as weekly status reports pertaining to grain car service," STB said in a June 20 order.
The railways were instructed to provide their plans by June 27, and the status reports will be required of each carrier until it resolves its backlog of unfilled grain car orders.
The weekly status reports must detail the running total of outstanding grain car orders, the number of new orders for the week, total orders filled for the week, the number of orders cancelled by shippers for the week, total orders cancelled for the week, the number of cars allocated to grain car service each week — including the number of private cars in service — and the average number of days late for all outstanding grain car orders.
In its June 4 weekly update to STB, BNSF said it had moved more volumes in each of the American Association of Railroads' (AAR) reporting weeks 10-22 in 2014 than in 2013; over that same 13-week period, BNSF reported that it moved 148,000 more units in 2014 than in 2013. In four of the last six AAR reporting weeks, BNSF reported that it moved more than 200,000 units despite ongoing issues affecting velocity on parts of its network.
Additionally, BNSF reported that it had exceeded its six-week fertilizer campaign goal of 52 trainloads, originating 57 trainloads and delivering 56 loads to their ultimate destinations for unloading through May 28.
The company said while it is proud of the improvement, "we still have progress to make before we meet the velocity and reliability needs of our customer base in all areas of our network."
"We committed to our customers that we will reduce the number of past-due cars and get current with existing orders, and this progress reflects the resources we are putting against that commitment," Carl Ice, BNSF president and chief executive officer, wrote in the June 4 update. "We expect to maintain this progress as we move grain hoppers being released as we finish out certificate commitments into the non-shuttle network in the next month."
In its weekly service update on June 20, BNSF reported that the previous week's past-due cars related to its agriculture business "were at their lowest level since February and were reduced by more than 1,200 cars from the prior week."
CP's public submissions have been sparse and, according to STB, "have not, to date, clearly articulated its plans for resolving the grain car order backlog 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," STB said.