Ethanol producers complain about snarled rail service

Trade group says rail service delays may lead to higher prices at the gas pump

By Bill Stephens for trains.com

WASHINGTON – The trade group representing ethanol producers has told federal regulators that its members are experiencing significant rail service delays and disruptions that could lead to higher gasoline prices.

“While we certainly understand that a variety of factors have contributed to these rail disruptions, it is imperative that all possible actions be taken by the nation’s railroads to ensure that these critical fuel supplies are immediately prioritized and reach markets as quickly as possible. Further delays could not only impact our industry but could ultimately increase fuel costs for American drivers,” Growth Energy, which represents 89 producers of ethanol, wrote in a Friday letter to the Surface Transportation Board.

Ethanol shipments moving in manifest service are taking two to four days longer than usual, the group said, while in extreme cases shippers have experienced delays of 10 to 14 days.

Unit train service has been inconsistent, as well, with railroads failing to pick up loaded trains on schedule. Delays range from three days to 12 days.

As a result, biofuel refineries whose storage is full have had to curtail production while awaiting the arrival of empty tank cars, and destination fuel terminals have run out of ethanol while awaiting loaded shipments.

The STB last week scheduled a two-day hearing on rail service, with BNSF Railway, CSX Transportation, Norfolk Southern, and Union Pacific ordered to attend. Canadian National, Canadian Pacific, and Kansas City Southern were invited to participate in the April 26-27 hearing at the board’s office.

The hearing announcement came after public complaints from grain and feed shippers and the secretary of agriculture and private complaints from a range of shippers.

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