Freight Tracks issue 36

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KATIE FARMER AWARDED HIGHEST IANA HONOUR

THE Intermodal Association of North America (IANA) will honour BNSF President and CEO Katie Farmer with with the 2023 Silver Kingpin Award during this year’s Intermodal EXPO, September 11-13, in Long Beach, California. The Silver Kingpin, the industry’s most prestigious award, recognises an individual’s long-term contributions to intermodalism. It was started in 1977 by the National Piggyback Association.

Farmer began her 31-year railroading career with Burlington Northern in 1992 as a management trainee in Fort Worth, TX and went on to positions in network operations, finance, customer service, sales and marketing. She also served as group vice-president running BNSF’s Intermodal and Automotive business. In 2018, she was named executive vice president and chief operating officer. In 2021, she became the first woman CEO of a Class I railroad and is also the head of BNSF’s board of directors.

“Katie’s career exemplifies what the Silver Kingpin Award is about – an individual’s significant impact on the intermodal freight transportation industry,” Joni Casey, President and CEO of IANA shared. "Her professional accomplishments – which include her 2015 and 2016 terms as the first woman Chair of IANA – are inspirations for the next generation of intermodal professionals.”

In addition to her IANA board service, Farmer is the former president of the National Freight Transportation Association. She also currently serves on Texas Christian University’s Board of Trustees and its Executive Committee, along with the Southwest Region Board of the American Heart Association.

A RIGHT ROYAL TRIBUTE

DB Cargo UK has unveiled a new-look Class 66 locomotive (66023) to mark the coronation of King Charles III.

The locomotive was officially unveiled at the company’s annual colleague event held at Toton TMD on Saturday, June 17.

The unveiling was performed by Depot Manager Matt Manson in front of more than 800 employees and invited rail enthusiasts. The Royal blue locomotive bears a Union flag and the official coronation logo featuring emblems from the UK nations - a rose, a thistle, a daffodil and a shamrock.

The transformation took place in Toton TMD’s onsite paintshop. Chief Executive Officer Andrea Rossi said: “DB Cargo UK has a long and proud relationship with the

Royal Family, holding the Royal Charter for the maintenance and operation of the Royal Train.

“It seemed fitting to mark His Majesty the King’s coronation with a colourful tribute of our own,” he added.

“It is a striking addition to our fleet of liveried locomotives and I’m sure will be a source of pleasure for the rail enthusiast community,” said Rossi.

Rossi: DB Cargo UK

ROLLING STOCK

Cost-effective and flexible

THE global railcar leasing market is poised for remarkable growth, with a projected CAGR of 5.4% from 2021 to 2031, according to the latest report by TMR. By 2031, the market is expected to reach a valuation of $26.5 billion, compared to $16.4 billion in 2022. As of 2023, the railcar leasing market is forecasted to reach $17.3 billion.

Throughout the forecast period, the tank car segment is anticipated to maintain its popularity, while the petrochemical and gases segment is expected to command a significant market share. Long-term leases will continue to be the favored lease duration in the railcar leasing market. North America is projected to be a lucrative market for railcar leasing, driven by the rapid improvement of

options for rail operations

transport infrastructure in both developing and developed nations. Railcar leasing offers a cost-effective and flexible option for transportation needs. With the increasing volume of global trade and the expansion of intermodal transportation networks, the demand for railcar leasing to support logistics networks is expected to rise. Furthermore, the market is expected to benefit from the growing

focus on sustainability, carbon emissions reduction, and the preference for environmentally friendly freight transport modes.

STOCK LEASING 4

The market also presents growth opportunities driven by the expanding manufacturing and construction sectors, as well as the rising demand for railcars to transport raw materials, equipment and finished goods. Technological

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advancements in the railcar industry, such as improved tracking and monitoring systems, telematics, and data analytics, will further enhance the demand for railcar leasing services.

In Europe, the railcar leasing market is expected to grow by $2.2 billion from 2022 to 2027, influenced by the utilisation of big data analytics in European rail freight. The adoption of big data analytics by European freight rail operators improves operational effectiveness and overall business performance. This trend is expected to fuel market expansion in Europe during the forecast period.

The freight cars segment will play a significant role in market growth, particularly in Eastern Europe, where the number of freight rail services is expected to rise due to increased manufacturing businesses and government investments in rail infrastructure. Continuous redesigning of freight cars by manufacturing companies to enhance capacity will drive the effectiveness of transportation and contribute to segment expansion.

Market players are employing a combination of organic and inorganic strategies to achieve greater market penetration. These strategies include the intro-

ROLLING STOCK

duction of new products, joint ventures, partnerships, acquisitions and the development of national and international distribution networks.

For example, GATX acquired Trifleet Holdings, gaining access to 18,000 railcar containers leased to customers in various sectors. GATX also invested in expanding its maintenance facilities to improve operational capabilities. VTG partnered with Nexxiot to incorporate temperature sensors in its wagons for real-time monitoring, and acquired the operations of Carbo rail to strengthen its position in the European market.

The railcar leasing market presents significant opportunities for growth, driven by market trends, technological advancements, and strategic partnerships, enabling companies to meet the evolving needs of customers and expand their market presence.

STOCK LEASING

WE RAILCARS

LEASING a railcar and dating might seem like two completely different worlds, but surprisingly they have a lot in common, says rail services company Tealinc. Both require careful consideration, planning, and the right approach to make them successful. Whether you’re looking for love or you’re looking to lease a railcar, there are tips and tricks that can help you find the

perfect match. So get ready to learn some creative ways to keep your railcar fleet on track and your heart full!

Here are some similarities between leasing a railcar and dating:

It times time and effort. Just like finding the perfect match, leasing a railcar requires

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ROLLING STOCK LEASING

time and effort. Researching your options, comparing prices, identifying what you like and don’t like, and negotiating terms are all necessary steps to consider. As with dating, it takes time and effort to find the railcars that will carry your same interests and values.

It’s all about compatibility. You wouldn’t date someone who didn’t share your values or interests, would you? The same goes for leasing a railcar. To get the perfect railcar for your very specific needs and requirements, you must find one that meets those needs and requirements.

It’s about the long-term. The lease on a railcar is long-term commitment, just like a relationship. You want to make sure that you are making the right decision for the longterm, and that your needs will be met for the foreseeable future. If you’re going to take that long-term commitment, you’d better be sure you like what you’re signing up for!

Know Your Budget. Just like dating, it’s essential to understand your budget when leasing a railcar. You don’t want to overspend or commit to something that you can’t afford. By knowing your budget, you can narrow down your options and find a railcar that fits within your financial limits.

Communication is crucial. Communication is key to any relationship, and the same applies for leasing a railcar. You need to communicate clearly with your lessor to ensure that you’re on the same page.

Don’t settle! Just like in dating, you shouldn’t settle for the first railcar you come across. Take your time, explore your op-

tions, and find the one that’s perfect for you. You don’t want to end up with a railcar that doesn’t meet your needs and makes you happy! And don’t forget to introduce the parents (or executives!) Knowing that their core values align can mean the difference between fun holidays or dreaded run-ins. For railcars this can mean easy negotiations or lawyers and conflict. Choose your battles wisely!

In the world of railcar leasing and dating, the search for the perfect match can be daunting.

With careful consideration and some creativity, you can increase your chances of success in both areas. Keep in mind, you just might strike out. Having a matchmaker on your side to help you find just the right match (railcar or love!) can be a game changer. When it comes to owning or leasing railcars, it’s all about having control over your supply chain and reducing costs. If you’re interested in leasing a railcar or finding love, remember that both will take time, effort, and careful consideration as you go about your pursuits. You don’t want to miss out on the right match, so keep an open mind, be creative, and don’t be afraid to take a chance!

Ermewa Group becomes Streem

IN April, Streem was unveiled as the new name and brand identity of a leading global player of the freight railcar and tank containers leasing industries.

Previously called Ermewa Group, Streem specialises in designing, optimising, financing and managing strategic assets for the global supply chain, offering customers safe, cost-efficient and environmentfriendly asset solutions. With offices in more than 40 locations and more than 1300 employees, Streem’s business is conducted through five complementary service offerings: Ermewa, which owns more than 45,000 freight wagons across Europe; Inveho workshops, for wagon maintenance and construction in France and Germany; Eurotainer, Raffles Lease, and DEMI, for the tank containers activity. Eurotainer and Raffles Lease together own more than 80,000 ISO tank containers worldwide, while DEMI is a dedicated tank container depot activity for maintenance and storage.

David Zindo, Chief Executive Officer of Streem,

declared: “The evolution of the Ermewa Group brand is a key strategic shift. Streem reflects a global vision to reaffirm our market leadership and put our values at the heart of our discourse. This new name reflects the fluidity, the dynamism, and the unity of our group, with all of us driven by a common vision. Our new signature, “Enabling the future of freight”, supports our common ambition to offer the best sustainable solutions to our clients. Streem gives us a new identity that looks to the future, where innovation rhymes with leadership, and reliability with sustainability.

"For the last 18 months, thanks to our talented teams and our new shareholders, we have accelerated our development, with the modernization of our fleet, always combining security and environmental performance, and we continue to bring innovation to the freight industry. As Streem, we aim at doubling our revenues by 2030, while actively contributing to the carbon neutrality agenda.”

SOWING FOR GRAIN

BY Canadian National

SOME people would have you think that all the grain grown in Western Canada is captive to one railway or the other – to make that statement is misleading.

In fact, 100% of grain handling and processing facilities in Western Canada have access to more than one rail carrier. Before we cover that statement in depth, let’s look at the competitive landscape of the grain handling and processing business in Western Canada.

It all starts in a truck

Think of the grain handling network of the 1980s and you’ll think of a three-ton truck hauling six or seven tonnes of grain five or ten miles down the road to a wooden grain elevator. And that farmer’s grain typically went to a single grain handling company.

The three-ton truck has been replaced by the Super B hauling 40 metric tonnes of grain or more over much greater distances. The availability of larger truck capacity and the associated economies of scale have created options for grain producers. Farmers today have access to multiple grain companies served by different rail carriers. Almost 85% of the primary elevator system on the Prairies is within 50 miles (80 km) of a grain handling facility located on a different rail network or is served by more than one rail carrier. That gives farmers options they didn’t have in the 1980s.

This new system is the result of a lot of private investment. Investment in Prairie grain handling infrastructure really took off in the early 2010s with government’s elimination of the Canadian Wheat Board. Farmers invested in semi-trailer units and on-farm storage. Grain companies invested in high throughput elevators, many with loop track capable of spotting 150-plus

SOWING THE SEEDS GRAIN TRAFFIC

THE EVOLUTION OF GRAIN PROCESSING AND THE PRIMARY ELEVATOR NETWORK IN WESTERN CANADA

cars. Rail companies invested in new locomotives and high-capacity hopper cars, replacing obsolete government-owned hopper cars. Strategic deregulation directly supported investments and efficiencies in the grain supply chain.

Dramatic shift towards grain processing

However, focusing solely on changes in the primary elevator network does not do the grain industry justice. The region’s oilseed processing industry is now a huge destination market for canola seed. Since the first rapeseed crush plant was built in the mid-1940s in Saskatchewan, the annual capacity of the industry’s oilseed processing business has grown to more than nine million tonnes. Over six million tonnes of that capacity is served by two railways. The same can be said of the malting industry, with three of four Prairie malt plants dual-served.

When you combine the primary elevator network with domestic canola and malt processing, over one-quarter of the Western Canadian grain can be directly accessed by multiple rail carriers. For farmers, who have the reach of modern trucking assets, the options are even greater. The days of farmers as “captive shippers” are over.

Partial de-regulation of rail rates

Canada’s grain industry has come a long way. From the 1930s through the 1980s, the primary elevator system on the Prairies was stagnant, with thousands of inefficient wooden grain elevators and limited investment in infrastructure. Government grain freight rate regulations, namely the Crow Rate, stifled investment in rail infrastructure and held back grain companies’ development of more modern grain handling infrastructure.

Government was eventually forced to use taxpayer money to backfill the investment shortfall in the 1970s, launching a hopper car build program.

In the 1980s, government finally began to deregulate, a process that culminated with the repeal of the Western Grain Transportation Act (and the end of the Crow Rate) in 1995.

In 1999, former federal Deputy Minister of Transportation Arthur Kroeger recommended the introduction of the Maximum Revenue Entitlement (MRE) – a type of revenue cap on railways - to help transition the grain industry to a completely deregulated market. The arrival of a supportive regulatory environment triggered large-scale hopper car fleet renewal in 2018. New high-capacity hopper cars helped Canada keep pace with the growing crop production volumes of modern agriculture.

Unfortunately, new regulatory intervention by government now threatens to jeopardise those gains.

Less regulation is the answer

The Emerson Report, a 500-page review completed in 2015, recommended an end to extended interswitching as it stifled private infrastructure investment, and further recommended the elimination of the market-distorting Maximum Revenue Entitlement (MRE) for grain.

Long-Haul Interswitching was the government’s solution to issues associated with extended interswitching. It opened 100% of the Prairies’ grain handling and processing assets to access to multiple rail carriers.

Yet today government wants to bring back extended interswitching and the revenue cap remains in place. The fact that this measure will only apply in the three Prairie provinces demonstrates this is not an evidence-based supply chain policy.

Extended interswitching means more resources are required to move the same amount of traffic. That slows down the network. A customer who wants to use extended interswitching on a rail line already at capacity creates congestion and hurts everyone on that line. As the efficiency of the rail network declines, costs go up across ALL rail traffic segments including regulated grain. Expect more cost, not less, from extended interswitching.

customers and a fact-based approach to improve efficiency. Extended interswitching regulations based on incomplete data and anecdotal evidence will again stifle investment and constrain capacity, effectively putting a cap on industry growth potential.

History shows deregulation is the best way to grow the economy.

If Canada hopes to improve how supply chains work, we also need to change how we measure and report on data. A balanced approach that considers all parts of the supply chain will help decision-makers better understand what is going on when problems arise and why. Government and industry need to bring transparency to all the components of the end-to-end grain supply chain.

All the links in the chain need to be working together to deliver results. It is time we measured performance in a new way.

CN believes there are tremendous opportunities to grow Canada’s grain supply chain. CN invests in its network and increases supply chain performance through collaboration with

India report

INDIAN RAILWAYS EARNINGS INCREASE BY 4% IN MAY

THE earnings from freight for Indian Railways have shown a positive growth of 4% compared to the same period last year, amounting to Rs. 14,084 Crores ($171m).

In May 2023, the railways achieved a freight loading of 134 million tonnes, indicating a 2% improvement over the previous year's loading of 131 million tonnes for the same period.

Specifically, in May 2023, the originating freight loading reached 134 million tonnes, surpassing the loading of 131.50 million tonnes in May 2022 by approximately 2%. Additionally, the freight revenue for May 2023 amounted to Rs. 14,641.83 crore ($187m), exhibiting a 4% improvement over the freight earnings of Rs. 14,083.86 crore ($171m) in May 2022.

When considering the cumulative data from April to May 2023, the freight loading reached 260.28 million tonnes, showing an approximate 3% improvement compared to the loading of 253.48 million tonnes in the same period last year.The revenue generated during this period amounted to Rs. 28,512.46 crore ($340m), indicating a 5% improvement over the earnings of Rs. 27,066.42 ($330m) crore in the corre-

sponding period of the previous year.

The breakdown of freight loading in May 2023 includes 65.89 million tonnes in coal, 15.23 million tonnes in iron ore, 13.20 million tonnes in cement, 10.96 million tonnes in other goods, 6.79 million tonnes in containers, 4.89 million tonnes in fertilizer, 4.85 million tonnes in food grains and 4.23 million tonnes in mineral oil.

These achievements can be attributed to the railways' dedication to the "Hungry For Cargo" mantra, which involves continuous efforts to improve business facilitation, enhance service delivery, and maintain competitive pricing. The customer-centric approach and the work of Business Development Units, along with agile policy-making, have contributed significantly to these accomplishments.

UP to be sole rail provider for new Buckeye Industrial Rail Park

UNION Pacific will be the exclusive rail service provider to Maricopa County’s new Buckeye Industrial Rail Park in Buckeye, Arizona. The park’s first tenant, Rehrig Pacific Company, recently broke ground on its 260,000-squarefoot injection moulding plastics manufacturing plant.

In spring 2024, Rehrig Pacific – a manufacturer of integrated, sustainable solutions for the supply chain and environmental waste industries – will begin manufacturing onsite reusable plastic products like industrial roll-out carts, recycling bins, pallets and other reusable plastic containers made from new and recycled resin. With a dedicated focus on the circular economy of plastics, all of Rehrig Pacific’s plastic products are 100% recyclable at end of life and

are made of up to 50% recycled materials while maintaining durability and longevity. Customers include Fortune 500 companies, municipalities and delivery distributors.

Union Pacific will play a strong role supporting Rehrig Pacific’s sustainable supply chain – trains are one of the nation’s most environmentally responsible modes of moving freight. Union Pacific can move one ton of freight 463 miles on a single gallon of diesel fuel, generating a carbon footprint that’s up to 75% less than trucks.

“Rehrig Pacific’s groundbreaking represents the first of many exciting opportunities to serve this new industrial park,” said Shelly Huckfeldt, manager-Industrial Development. “This devel-

Logistics partners participating in Rehrig Pacific Contracting, Inc.; Todd Stanley, manager-Yard Operations,

opment will be shovel ready – with utilities and rail already available onsite, future users can quickly take advantage of the competitive benefits of being a rail-served facility.”

The 260-acre (101 ha) rail park is zoned for distribution, logistics, heavy manufacturing and technology development. Located 40 miles from Phoenix Sky Harbor International Airport, the rail park provides convenient access to SR-85, I-8 and I-10 – placing tenants within a one-day trucking distance to major cities like Los Angeles, San Diego, Las Vegas and El Paso.

Los Angeles Service Unit train crews, based out of Union Pacific’s Phoenix yards, will begin providing rail service in spring 2024.

Pacific Company’s groundbreaking ceremony at Arizona’s new Buckeye Industrial Rail Park included, from left, Vern Van de Loo, president, Mountain States Operations, UP; Alexandra Hiscock, commercial consultant, UP; and Theresa Jackson, national purchasing manager, Rehrig Pacific.

UP refreshes loco paint scheme, KEEPS iconic flag design

UNION Pacific has finalised its highly anticipated locomotive paint scheme, marking a significant milestone for the company. While retaining its iconic flag design, which has served as a fitting tribute to the victims of 9/11 for over two decades, the placement of the design has been strategically adjusted. This decision follows a rigorous process of testing and gathering feedback throughout the summer.

Union Pacific prides itself on its commitment to excellence and innovation. In response to valuable input received from employees, it was determined that the previous flag placement was susceptible to wear caused by

engine heat. To preserve the flag's integrity as a sacred symbol, a new placement has been devised to ensure its pristine condition remains intact.

Lance Fritz, the Chairman, President and CEO of Union Pacific, emphasised the significance of the locomotive's flag, stating: "UP has played a role in propelling the US economy forward, the flag adorning our locomotives serves as an exceptional representation of our dedication."

The implementation of the new design will be spearheaded by the proficient employees at the renowned Jenks Locomotive Shop in North Little Rock, Arkansas. As

locomotives undergo modernisation or overhaul, the team will meticulously applied the revised paint scheme. The occasion of the first locomotive showcasing the refreshed design was marked by the SD70ACe locomotive with the distinguished number UP8608, which made its highly anticipated service debut on September 12.

UP's dedication to honouring its roots and symbolising the spirit of America shines through this milestone. As the locos cover the vast landscapes of the US, they will continue to embody the company's role in propelling the nation forward and fostering economic growth.

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Whatever you call it ...

Rail freight

Goederenvervoer per spoor

Transporte ferroviario

Fret ferroviaire

Järnvägstransporter

Transporto ferroviario

Vasúti árufuvarozás

Raudteekaubavedu

CPKC and CSX announce planned hydrogen loco collaboration

CANADIAN Pacific Kansas City (CPKC) and CSX Corporation are to enter into a joint venture for the building and deployment of hydrogen locomotive conversion kits for diesel electric locomotives.

As an initial step in the collaboration, CSX plans to convert one of its diesel locomotives using a hydrogen conversion kit developed by CPKC. The conversion work will be done at CSX's Huntington, West Virginia locomotive shop.

"This innovative collaboration expands our hydrogen locomotive program beyond a single railroad and represents an exciting next step in proving the longterm viability of hydrogen as a solution to emissions reduction for our industry," said Keith Creel, CPKC president and chief executive officer. "Our hydrogen locomotive went from concept to reality in 24 months with the first zero emissions hydrogen locomotive having already pulled freight in revenue service. We look forward to this collaboration as we work to create a lower carbon future."

"CSX looks forward to working as a partner with CPKC in the development of the hydrogen locomotive program as it demonstrates our commitment to implementing alternative fuel solutions that could further enhance our emissions performance and offer our customers an even more environmentally-friendly transportation solution," said Joe Hinrichs, CSX president and chief executive officer. "This exciting initia-

tive will greatly benefit from the expertise of CSX's advanced, large-scale facilities, where the locomotives will be built."

Nearly the entire freight locomotive fleet of all railway operators in North America consists of diesel-powered units, representing the industry's most significant source of greenhouse gas emissions. Rail has an important role to play in a lower carbon economy and the industry needs a long-term, effective alternative fuel solution.

In December 2020, Canadian Pacific (CP) announced plans to develop North America's first linehaul hydrogen-powered locomotive by retrofitting a diesel freight locomotive with hydrogen fuel cells and battery technology to drive the locomotive's electric traction motors. The prototype, designed and built by in-house CP engineers, made its first movement under its own power in late 2021. By the end of 2022, the locomotive had made its first revenue moves and now has accumulated more than 1,000 miles of testing in revenue service.

CPKC has deployed a second hydrogen locomotive for testing in terminal operations, a program expansion supported by funding awarded by Emissions Reduction Alberta and the Government of Canada Low Carbon Economy Fund.

The second hydrogen locomotive is expected to enter service later in 2023.

SINCE 2011, the residual waste of the city of Innsbruck and the districts of Innsbruck-Land and Schwaz has been processed for thermal recycling at the RZ Ahrental recycling centre. From there it is transported by rail to industrial plants in Upper Austria in the form of so-called energy bales and loose material.

Thanks to the successful co-operation of #RCG with LINZ AG / Energie AG OÖ and in succession with partners ATM-Abfallwirtschaft Tirol Mitte and IKB-Innsbrucker Kommunalbetriebe, 1,111,111 tonnes of waste have already been transported by rail in an environmentally friendly way. This corresponds to around 4,000 truck journeys saved each year.

"A great achievement, made possible by teamwork and our innovative MOBILER logistics," says a company statement.

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ON THIS DAY: RAILFREIGHT HISTORY

JUNE 30

1949 Last day archbar freight trucks can legally operate in US interchange service only on empty cars returning to their home roads.

JULY 6

1950 Canadian Pacific opens the first retarder hump yard in Canada at St. Luc, Montreal

2013 Shortly before 01:00 am, a 72 car Montreal, Maine and Atlantic Railway train of mostly oil tanks, which was parked unattended for the night at Nantes, Québec, started to roll. It runs away approximately 7.2 miles, (11.6km) reaching a speed of 65 mph (136 km/h) and derails at Lac Megantic, QC. About 1,320,000 gallons (6 million litres) of petroleum crude oil spilled. The resulting explosion kills 47 people. The runaway is carrying crude oil derails and explodes. Fifty people are missing and presumed dead. Thirty buildings were destroyed. The engineer had left the train to take a break, engaging the brakes before he left. There was environmental contamination of the downtown area and of the adjacent river and lake.

JULY 7

1838 An act of the United States Congress officially designates all railroads in the United States as postal routes.

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