The Pacific Northwest is known for its cornucopia of perishables from frozen vegetables, apples, pears, potatoes, onions, French fries, frozen and fresh carrots, corn, wine, beer, juice concentrate, and a cross section of fish.
For several years, shippers of these products in this region have benefited from refrigerated expedited intermodal freight services dubbed the Cold Train offered by Rail Logistics LLC. Those services are soon to be expanded as a result of Michigan-based Federated Railways, Inc.’s purchasing of Rail Logistics’ assets, which includes its Cold Train.
What does this mean for shippers? The purchase is expected to expand Cold Train’s fleet by a minimum of 1,000 containers over five years, thereby bringing it to 1,400 containers. This will make it one of the bigger refrigerated domestic container shippers in the United States.
Rail Logistics, which owns 400 containers, came close to shipping close to 1,000 containers per month in 2013 from the Ports of Quincy (Washington) and Portland (Oregon).
“With this added capacity, Cold Train will be able to offer more capacity to service different destinations and locations,” comments Louis P. Ferris, president of Federated Capital Corp. “This is important as many shippers and receivers are looking for door-to-door intermodal logistics solutions that decrease cost, increase efficiency and reduce the carbon footprint.”
With capacity being a big issue and Cold Train currently servicing 20 states, that critical mass is helpful. “It allows us to service larger customers, even better than we now do,” says Patrick Boss, Cold Train spokesman, during an AJOT interview.
Big Issue: Long Haul Trucking
The biggest issue facing perishables shippers in the United States today is the uncertain future of long haul trucking. Challenging the trucking industry are new hours-of-service regulations, plus the fact many long haul drivers must be away from home days upon a time. Consequently, trucking firms are finding it increasing difficult to hire qualified truck drivers for long haul routes.
“Truck drivers can work with us to pick up a load in the morning, bring it to the terminal that afternoon, and be gone only one day,” Boss says. “Our service blends the best of short haul trucking and long haul rail.”
While intermodal service is not the cheapest game in town, it gives shippers more choices. “And that is good for all shippers and receivers,” Boss says.
Going forward, additional capacity and the ability to serve markets with a bigger critical mass of equipment is going to be increasingly important.
“A lot of shippers are trying to plan ahead next 5 years,” Boss explains. “Most perishable products still run in long haul trucks. With uncertainty in that industry, it creates more attention on domestic intermodal and what it can do. We have to be ready for some of these intermediate and shorter term shifts that are occurring. “
Consequently, Boss predicts that a lot more product is going to be moving long haul on rail. “Companies like ours have to be ready for that as do the railroads,” he says. “We are preparing for it, and we are trying to increase our fleet size.”
Paradigm Shift for Reefer Cargo
While domestic intermodal services are not new, a paradigm shift is occurring that is allowing for the proliferation of refrigerated intermodal. This includes improvements in container design, refrigeration technologies and tracking that make it possible for companies to now put cold chain products in reefer containers and efficiently ship them via rail across country. Most important, railroads now offer service that allows expedited shipping of refrigerated projects.
“This allows companies like Cold Train to work with both the trucking companies and railroads to deliver product quickly using intermodal,” Boss says. “The railroads have found this to be a great new source of business. The beauty for the railroads is they haul shipments from point A to Point B and companies like Cold Train pick up the shipments, track them, and make sure they get delivered.”
Some five years ago this option did not exist. But now with BNSF’s commitment to service performance and reliability that makes it possible for fresh and frozen foods to go on expedited trains, this opens up a host of options for shippers.
In fact, BNSF now markets a fresh and frozen service that includes a well maintained fleet of refrigerated boxcars with satellite temperature monitoring to ensure the safe arrival of a quality product.
Intermodal rail service has especially proven its worth this winter. “While the winter weather slowed shipments down a little bit, trains proved to be more reliable than trucks,” notes Boss. “Generally the speed of the rail system is good, even when the weather is bad.”
In fact, Cold Train is now shipping a wide variety of perishables across the country, including frozen fish, apples, yoghurt, ice cream, pizza, cherries, and strawberries. According to Boss, containers are full both directions.
“Interestingly enough, during the last several months we’ve had more coming back than going out of the Pacific Northwest,” Boss says. “A lot of shippers need to bring shipments back to the Northwest and, frankly, a lot of trucking companies would rather send trucks to California, so we get lot of business from trucking companies and other transport providers.”
Among those products are those that are products coming from the Midwest —sweet potato fries, candy, dairy products, starches, cranberry concentrates, and coffee creamers.
Backhaul shipments are not necessarily refrigerated. “We’ve even had companies call that need to deliver loads of office products that, because they need to be dry, need to be shipped in an insulated container,” he explains. “Even though we might not turn on the container’s air conditioning, the insulated containers are valuable because they keep the temperature constant.”
This is especially the case for computers or beverages. “You don’t want these to get too hot or too cold,” Boss notes.
This year in particular, with the Polar Vortex, a lot of companies are using the dry, insulated containers to protect their shipments against the cold temperatures across the northern corridor.
While the fall months used to be the company’s busy season, Boss reveals that business has become more consistent throughout the year. “Part of this is because the frozen product market is very consistent throughout the year and fresh produce shippers are able to store products for long periods of time.
“For example, apples and potatoes can be stored 12 months a year. This makes it possible for shippers to ship product throughout the year,” he says. “Also, many of retailers or receivers are very sophisticated about their supply chains and better able to plan their shipments. The expectations are not as random as they were 10 years ago.”
While Cold Train does get inquiries regarding international shipments, Boss explains that for now it concentrates on domestic intermodal shipments because they are in 53-foot containers. “Most international containers are 40 footers,” he remarks. “But we are getting increasing inquiries about how we can work with ocean carriers to transload shipments from their 40-foot containers to our 53-containers or vice versa.”
Cold Train Details
Currently, Cold Train service runs 6 days a week out of both Washington and Oregon. “We literally have a train leaving every day except for Sunday,” says Boss. “Frankly, our shippers love that because it gives them a lot of flexibility to plan loads.”
Boss explains that the Port of Quincy is advantageous because of its location within the heart of Washington State.
“From there you are about 80 percent of the apple and French fry production; 75 percent of the frozen vegetable and potato production, plus you’re about an hour drive from mega areas for fresh produce,” he says. “It’s close to Interstate 90 and has some of the lowest electrical power costs in the country because of the hydro power. This makes this area advantageous for cold storage, production, and processing.”
Cold Train works with BNSF exclusively between the Pacific Northwest and the Chicagoland area. All containers leave Portland or Quincy for Chicago six days a week. Once past the Midwest to points east and south, Cold Train containers are transloaded onto rail operated by CSX, Norfolk Southern (NS), and Canadian National Railroad (CN).
“We use CN into Ontario and are currently looking at it for shipments into Quebec,” Boss reveals.
Interestingly, Cold Train also uses CN into Louisiana and Mississippi since CN offers service to these markets from Chicago several times a week.
Each Cold Train container has its own self-powering cooling system that runs independently of the truck or train.
“We have our own monitoring systems in which we can control the temperature of each container from our offices or mobile phones,” Boss notes. “The containers do not have to be plugged into a truck or train. Consequently, the railroad and trucking companies only have to haul product. We can notify the truck driver or the railroad if the container is not running properly.”
Canadian shippers particularly like the service because Cold Train can bring a whole train of containers across the border and clear Customs as opposed to clearing each individual truck.
The service also generates less carbon emissions than trucks. “That’s important today since many companies request a sustainability report from us,” Boss says. “Frankly, we can reduce the carbon emissions around 52 percent and higher.”
Overall, Boss praises the railroads for doing a good job at upgrading their infrastructure to where they are trying to increase their train speeds. “Speed needs to be good, but in the end, we still need to offer a service that is going to be price competitive,” he says. “We will need to get apples, potatoes, French fries, onions and other products to market quickly. We have to continue to tweak what we are doing to make sure that happens.
The Cold Train is not the only domestic intermodal service available. With more shippers of perishables turning to this mode, others are entering the market. One is McKay TransCold, a third-party logistics (3PL). It plans to commence its flagship service—TransCold Express—in the first quarter 2014.
According to corporate materials, this dedicated, refrigerated 50-car unit train will offer bi-directional service one day a week on Wednesdays between California’s Central Valley (Selma, California) and the Midwest (Wilmington, Illinois). The service will move refrigerated and frozen consumer goods and produce by the carload, truckload, or less-than-truckload (LTL) via BNSF’s newly refurbished fleet of refrigerated box cars. Each refrigerated boxcar holds up to four truckloads.
“We have worked closely with the BNSF team to craft a program that will fill a niche in current modes of transportation. It was important to bring a service to the market that added value and focused on overall supply chain solutions,” says Randy McKay, chief executive officer of McKay TransCold.
“TransCold Express represents a new milestone in refrigerated train service on our network,” said Dave Garin, BNSF group vice-president, Industrial Products. “Our network provides an ideal solution for perishable shippers to achieve superior supply chain performance because of BNSF’s commitment to service performance and reliability.”
The Illinois location will provide competitive service to Wisconsin, Michigan, Indiana, Iowa, Ohio, Kentucky, and the East Coast, including Pennsylvania, New York, New Jersey, the Carolinas, and select Canadian markets including Toronto. The California location will serve all of California and southern Nevada. Services of forward distribution, consolidation and redistribution will be offered at the hubs.