April 14, 2014
English: A Union Pacific Intermodal Train does...
Despite adverse weather, railroads started 2014 in strong fashion (Photo credit: Wikipedia)

We talked about the resurgent U.S. railroads at the turn of the year, and their role in fueling wider economic growth, so it’s exciting to see that volumes are on the rise again.

During the first quarter of this year, railroads moved 3.8% more than the corresponding period in 2013.

“U.S. rail traffic rebounded strongly in March 2014 following a subpar February,” reports John Gray, the SVP of  the Association of American Railroads. He added in a statement that last month’s performance shows there is “every reason to be optimistic that 2014 will break 2013’s intermodal volume record.”

The encouraging data comes in the wake of a long and difficult winter for much of the country.

Despite this adverse weather, intermodal transport solutions rose to the challenge and set 2014 off on a fine footing for the rest of the year. Railroads took the strain even as trucks found it slow going on the country’s highways and interstates, demonstrating that having a variety of freight options available is a must for managers running extensive supply chains.

And for businesses interested in eliminating waste from supply chain costs, understanding the many options for getting goods from point A to point B (and C, D, etc!) is a pre-requisite. With so many complex variables at work, knowing your way around the world of transport helps both to plan more effectively in advance and respond to supply chain challenges as they arise.

Hopefully there’s more volume being pushed through your business as the year progresses, so make sure you’re managing it efficiently and cost-effectively!

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January 13, 2014
An eastbound BNSF train at Prairie du Chien, W...
An eastbound BNSF train in Wisconsin.  (Photo credit: Wikipedia)

At more than $60 billion in annual revenues, the U.S. freight rail network is a high-value and rapidly changing part of the supply chain.

Early reports on railroad performance during 2013 and announcements of proposed infrastructure investment each demonstrate why logistics managers are focusing more attention on rail as a part of their intermodal transportation solutions.


Record Rail Growth

With 12.8 million containers and trailers riding the rails last year, a rise of 4.6% (Association of American Railroads) on the previous year, 2013 proved to be a record-breaker. 2006 was the previous high and the notable growth following a period of extended economic trouble is further evidence that the year ahead could be a boom year for U.S. business.

The rail freight rises have put the efficient integration of rail and road solutions high on the list of logistics priorities this year, as huge names like Home Depot move closer to rail freight facilities.

Fully one-third of U.S. distribution center developments currently underway will factor in some form of railroad connection. For supply chain planners hoping to take advantage of this rail rush, the biggest challenge may be finding space, not only on the rails with moving cargo, but also next to them to unload and move it onward.

As the country’s dependence on rail freight grows, lawmakers are moving to ensure that supply keeps up with that demand.


Investing in Infrastructure

Looking to the future, U.S. Rep. Adam Smith last week reintroduced the Freight Infrastructure Reinvestment Act. Citing a vision for as far ahead as the next quarter-century, Smith stated:

“With our nation’s freight expected to double by 2040, it is critical to start making investments in freight and transportation infrastructure now to keep America competitive internationally for years to come.”

The legislation aims to drive infrastructure development and efficiency by introducing grants for states who propose initiatives at a local or regional level. Such a long-term focus is to be applauded given the still-fresh wounds of the economic crash and the slow short-term drag back to employment and profitability.

We see constraints across the network as it is, and with the expansion of container ships and the routes that serve them, the U.S. needs a plan in place to keep up with what we hope will be not just a surge, but a sustained level of demand. Hopefully states and businesses will rise to this challenge, making the most of the return to strength currently riding the nation’s railroads.

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