Truckers Gain Hazmat Business as Railroads Spurn Toxic Gases
By Daniel P. Bearth, Staff Writer
This story appears in the March 24 print edition of Transport Topics.
An effort by rail carriers to reduce the amount of toxic chemicals they haul is creating new business for some trucking companies. Meanwhile, shipper groups said the railroads are being “irresponsible” and trucking officials warned they don’t have enough spare capacity to handle all the chemical shipments railroads traditionally move.
Charles Whittington, president of Grammer Industries Inc. in Grammer, Ind., said he recently signed a three-year deal with a major chemical company to handle shipments of anhydrous ammonia previously moved by rail.
“This will double the amount of business we do with one stroke, and I see a lot more coming,” said Whittington, who also said he is buying 80 new trailers and 15 new tractors to accommodate the business.
Whittington, who also is first vice chairman of American Trucking Associations, said railroads want to stop hauling certain chemicals — mainly anhydrous ammonia and chlorine — following a number of recent, costly accidents. His firm specializes in hauling anhydrous ammonia, liquefied petroleum gases, carbon dioxide, nitric acid and liquid hazardous waste in the eastern U.S.
Some cities have tried to ban rail shipments of hazardous chemical on routes through heavily populated urban areas, and in some places, such as Washington, D.C., rail carriers have rerouted some trains.
While rail carriers maintain that railroads are still the safest means of transporting hazardous chemicals, Edward Hamberger, president of the Association of American Railroads, presented a new argument at a February congressional hearing on antiterrorism legislation: Chemical companies should stop making chemicals such as chlorine gas, which is used to disinfect water supplies, because safer alternatives are available.
Eliminating chlorine shipments would reduce the threat of a terrorist attack, and “America would be a safer place,” Hamberger said.
To support his position, Hamberger cited a 2007 report, “Toxic Trains and the Terrorist Threat,” published by the Center for American Progress, that said: “The only way to truly protect communities is to get unnecessary toxic cargoes off the tracks.”
AAR spokesman Tom White said in a telephone interview with Transport Topics that AAR would lobby either for a cap on carrier liability or legislation that would eliminate the legal obligation of railroads to carry all kinds of chemicals.
“Trucking companies can get out of the business of hauling hazardous materials. [Railroads] don’t have that option,” he said.
Jack Gerard, president of the American Chemistry Council in Arlington, Va., said transport of chemicals is a responsibility shared by chemical manufacturers and all transportation partners.
“Instead of taking irresponsible positions, America’s railroads need to continue working with their customers on realistic solutions to improve safety and security,” he said.
Ford West, president of The Fertilizer Institute in Washington, D.C., chided Hamberger for advocating elimination of the manufacture of “essential” chemicals and said the rail trade group “may have forgotten its own testimony that rail is the safest form of transportation for hazardous materials.”
“The railroad industry has an obligation to the public to provide transportation in support of American commerce,” West said.
John Conley, president of National Tank Truck Carriers, said some NTTC members have reported an increase in truck shipments of chemicals, but he cautioned that the industry is not prepared to handle a big increase in shipments of toxic inhalants, such as chlorine gas, that require special handling and equipment.
Conley said railroads “want to make an economic decision to get out” of hauling certain chemicals “and are not allowed to by law” because of federal oversight of the rail industry.
“I do object to their using an argument that these materials cannot be transported safely and securely,” he added. “They have done so, as has the trucking industry.”
Whittington said it takes four trucks to match the capacity of a single rail car, but increases in rail rates make shipping by truck competitive. He said trailers for hauling anhydrous ammonia cost $125,000 each.
The cost of shipping anhydrous ammonia by rail to central Indiana from Tampa, for example, has gone to $275 a ton from $75 a ton, Whittington said. From Savannah, Ga., truck rates used to be twice as high as rail rates, but now rail is twice as much.
“The economics have changed,” he said.
AAR’s White declined to discuss rate issues, but said rail carriers are facing serious liability issues related to hauling chemicals known as toxic inhalation hazard, or TIH.
“It’s difficult to get insurance,” White said. “The potential liability is enormous.”
Half of the cost of the insurance railroads pay for covers liability for shipments of TIH, which represent 108,000 carloads a year, less than one-half of 1% of total rail carloads, White said. Chlorine and anhydrous ammonia are more than 80% of rails’ total volume of TIH, he said.
Another factor for rail carriers is the cost of meeting new federal safety standards for rail cars that carry chemicals.
Frank Reiner, vice president of transportation and emergency preparedness for the Chlorine Institute in Arlington, Va., said new regulations will require “a significant investment” in new equipment by the railroads.
A spokesman for the Federal Railroad Administration said a combination of factors, including accidents, have caused the agency to reevaluate the design and structural integrity of rail tank cars.
“It is an extremely high priority,” the spokesman said, adding that a rulemaking is expected “in the not too distant future.”
This story appears in the March 24 print edition of Transport Topics.
An effort by rail carriers to reduce the amount of toxic chemicals they haul is creating new business for some trucking companies. Meanwhile, shipper groups said the railroads are being “irresponsible” and trucking officials warned they don’t have enough spare capacity to handle all the chemical shipments railroads traditionally move.
Charles Whittington, president of Grammer Industries Inc. in Grammer, Ind., said he recently signed a three-year deal with a major chemical company to handle shipments of anhydrous ammonia previously moved by rail.
“This will double the amount of business we do with one stroke, and I see a lot more coming,” said Whittington, who also said he is buying 80 new trailers and 15 new tractors to accommodate the business.
Whittington, who also is first vice chairman of American Trucking Associations, said railroads want to stop hauling certain chemicals — mainly anhydrous ammonia and chlorine — following a number of recent, costly accidents. His firm specializes in hauling anhydrous ammonia, liquefied petroleum gases, carbon dioxide, nitric acid and liquid hazardous waste in the eastern U.S.
Some cities have tried to ban rail shipments of hazardous chemical on routes through heavily populated urban areas, and in some places, such as Washington, D.C., rail carriers have rerouted some trains.
While rail carriers maintain that railroads are still the safest means of transporting hazardous chemicals, Edward Hamberger, president of the Association of American Railroads, presented a new argument at a February congressional hearing on antiterrorism legislation: Chemical companies should stop making chemicals such as chlorine gas, which is used to disinfect water supplies, because safer alternatives are available.
Eliminating chlorine shipments would reduce the threat of a terrorist attack, and “America would be a safer place,” Hamberger said.
To support his position, Hamberger cited a 2007 report, “Toxic Trains and the Terrorist Threat,” published by the Center for American Progress, that said: “The only way to truly protect communities is to get unnecessary toxic cargoes off the tracks.”
AAR spokesman Tom White said in a telephone interview with Transport Topics that AAR would lobby either for a cap on carrier liability or legislation that would eliminate the legal obligation of railroads to carry all kinds of chemicals.
“Trucking companies can get out of the business of hauling hazardous materials. [Railroads] don’t have that option,” he said.
Jack Gerard, president of the American Chemistry Council in Arlington, Va., said transport of chemicals is a responsibility shared by chemical manufacturers and all transportation partners.
“Instead of taking irresponsible positions, America’s railroads need to continue working with their customers on realistic solutions to improve safety and security,” he said.
Ford West, president of The Fertilizer Institute in Washington, D.C., chided Hamberger for advocating elimination of the manufacture of “essential” chemicals and said the rail trade group “may have forgotten its own testimony that rail is the safest form of transportation for hazardous materials.”
“The railroad industry has an obligation to the public to provide transportation in support of American commerce,” West said.
John Conley, president of National Tank Truck Carriers, said some NTTC members have reported an increase in truck shipments of chemicals, but he cautioned that the industry is not prepared to handle a big increase in shipments of toxic inhalants, such as chlorine gas, that require special handling and equipment.
Conley said railroads “want to make an economic decision to get out” of hauling certain chemicals “and are not allowed to by law” because of federal oversight of the rail industry.
“I do object to their using an argument that these materials cannot be transported safely and securely,” he added. “They have done so, as has the trucking industry.”
Whittington said it takes four trucks to match the capacity of a single rail car, but increases in rail rates make shipping by truck competitive. He said trailers for hauling anhydrous ammonia cost $125,000 each.
The cost of shipping anhydrous ammonia by rail to central Indiana from Tampa, for example, has gone to $275 a ton from $75 a ton, Whittington said. From Savannah, Ga., truck rates used to be twice as high as rail rates, but now rail is twice as much.
“The economics have changed,” he said.
AAR’s White declined to discuss rate issues, but said rail carriers are facing serious liability issues related to hauling chemicals known as toxic inhalation hazard, or TIH.
“It’s difficult to get insurance,” White said. “The potential liability is enormous.”
Half of the cost of the insurance railroads pay for covers liability for shipments of TIH, which represent 108,000 carloads a year, less than one-half of 1% of total rail carloads, White said. Chlorine and anhydrous ammonia are more than 80% of rails’ total volume of TIH, he said.
Another factor for rail carriers is the cost of meeting new federal safety standards for rail cars that carry chemicals.
Frank Reiner, vice president of transportation and emergency preparedness for the Chlorine Institute in Arlington, Va., said new regulations will require “a significant investment” in new equipment by the railroads.
A spokesman for the Federal Railroad Administration said a combination of factors, including accidents, have caused the agency to reevaluate the design and structural integrity of rail tank cars.
“It is an extremely high priority,” the spokesman said, adding that a rulemaking is expected “in the not too distant future.”
