COLUMN-U.S. railways slow to a crawl on Chicago snarl-up: Kemp

Mon Apr 14, 2014 11:04am EDT
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(John Kemp is a Reuters market analyst. The views expressed are his own)

By John Kemp

LONDON, April 14 (Reuters) - Extreme winter weather and increased congestion have slowed rail shipments on large parts of the U.S. network to a crawl since the start of the year, prompting farmers and other rail users to complain.

"(We) are growing increasingly concerned about the deterioration in service that is now occurring over significant areas of your system," regulators at the Surface Transportation Board (STB) wrote in a letter to Burlington Northern Santa Fe (BNSF) railroad at the beginning of February.

Farmers have blamed increased oil shipments and poor service by the railroads and have pressed regulators to intervene. But extreme winter weather, more than anything, has caused the backlog, which will probably last several more months.

The STB, which monitors railroad services and fees, also sent a letter to Canadian Pacific (CP) at the start of March to demand an explanation for the delays and an action plan to restore acceptable customer service.

Rail operators acknowledge the problem, particularly in the Midwest and in the northern plains states, citing bad weather, rising oil shipments and a bumper grain harvest.

"BNSF's service in the fourth quarter of 2013 and the first quarter of 2014 has fallen short of our customers' expectations," the railway admitted to the STB.

Rail cars moving grains and sugar beet have been affected particularly badly. The railroads are still struggling to restore service even as the weather improves.   Continued...