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| Delta Grain Producers to Benefit from UP Service
January 20, 2014 | 05:00 p.m. CST
Tenacity, market knowledge and expeditious planning is helping Union Pacific capitalize on increased grain production in the Mississippi Delta, while supporting a commodity trading company with the same goal.
Lansing Trade Group announced this month plans to construct a shuttle train facility on Union Pacific's tracks near Grayridge, Mo. Designed to load 110-car shuttle trains, the facility will feature high-speed truck receiving for multiple commodities, helping fulfill UP's strategy of growing large scale, efficient grain facilities.
"This opportunity allows Lansing to bring value to producers in the rich production area of the Missouri boot heel, by providing access to a high-speed, UP-served shuttle loading facility," said Bill Krueger, Chief Executive Officer-Lansing.
Lansing originally identified the Graybridge site on the St. Louis Service Unit's Sikeston subdivision as a potential location, but the line previously had been abandoned in 2009. Barb Moore, UP regional manager-Industrial Development, led an effort to have the line put back into service; however, the project was shelved for commercial reasons. In the meantime, southern grain production continued to increase, and UP remained engaged in the potential opportunity. Eventually, a commercial agreement was achieved in the second quarter of 2013.
"With both parties on board, we hit the ground running," said Darryle Todd, senior business manager-sales, Agricultural Products. "Everyone was committed to driving this project quickly and aggressively through our commercial and operational processes, so our customer could begin construction as soon as possible."
UP initiated its POWER process, led by David Welch, senior manager-business development planning, Agricultural Products. The POWER process determines operational requirements anytime a customer seeks rail service for a track it has not previously used, or if it plans to expand current track infrastructure. The new Graybridge facility located on the Sikeston Subdivision intersects three other subdivisions. Because of this track configuration and directional traffic in the area, it will require a unique operational solution, including a 286,000-pound line upgrade to support the new grain business.
"Making these track investments for the facility – the first major industry at this location – also paves the way for future businesses who may consider locating on the subdivision," Welch said. "Additionally, Lansing is able to lease 14,000 feet of track from us, reducing their capital requirements."
The POWER process required collaboration among Real Estate, the St. Louis Service Unit, Network Planning, Ag Marketing and the Law Department. Throughout the project, the customer was updated weekly, ensuring that UP was meeting their expectations.
Scheduled for fall completion, the facility is expected to increase grain volumes by more than 50 trains annually, acquiring business that previously moved via Mississippi River barge. It also will bring online manifest rice shipments destined for the Louisiana Gulf Coast and Mexico.
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