Cargo owners moving imports from Port Houston to Dallas will have one fewer surface transport option after Union Pacific Railroad eliminates intermodal rail service between Barbours Cut and Dallas on Apr. 26. The late-April deadline allows containerships already in route from Asia to use the service a final time.
The decision isn’t necessarily surprising because there was only one train per week and volume was relatively low, according to a UP spokesperson. Part of precision scheduled railroading, a principle in UP’s Unified Plan 2020, entails eliminating low-yield routes and redeploying assets to busier lanes.
For shippers, the question now becomes whether drayage or truckload is the best alternative. The answer comes down to how the minutes add up in a day.
The on-duty clock begins when the drayman leaves for Barbours Cut Terminal. Then the driver enters the terminal, gets a chassis and container, and must pass a roadability inspection. This process can take two hours. Then it’s a five- to six-hour trip to Dallas. Next is delivering the container and getting an empty box in exchange, which could take two hours if it’s not a drop and hook.
Finally comes the return trip to Houston. Under federal regulations, it’s illegal to drive more than 11 hours per day, or remain on duty more than 14 hours, and the driver must take a 30-minute break during a shift. If there are any delays in the terminal, on Interstate 45, or at the beneficial cargo owner’s (BCO’s) dock, the clock will run out and a layover charge will be assessed to the BCO. It’s not really the delivery that is a problem so much as getting back to Houston before the clock expires.
Alternatively, a BCO could transload cargo into a trailer and hire a truckload carrier. Drayage would cost $1,000 to $1,100, including fuel, while truckload would run about $500 plus transloading costs, according to a review of digital brokers. Patrick Maher, vice president of Gulf Winds International, said the truckload option would probably save $100 to $150 after transloading. It also saves money because it eliminates daily chassis rental charges. Due to the time it takes to transload, however, full truckload would likely take two days.
Maher said it’s possible to complete a dray into south Dallas within a day but northern Dallas or Fort Worth is unlikely. The borderline is probably Interstate 30, running east-west across the city.
“This is one less option that a shipper has to utilize when shipping all water from Asia to Dallas-Fort Worth,” Maher said of UP’s decision to shutter the Houston-Dallas intermodal line. “We are hopeful that the decision will be reevaluated as Houston continues to grow all-water volumes versus importing through the West Coast. This will immediately create some capacity shortages because the freight absorbed into the rail network and now goes back to truck.”
Port Houston also expressed disappointment in a statement to JOC.com.
"However, while having this line as an option was a benefit to our customers, we are optimistic that in time, UP will recognize the advantage to resume providing this service route to the benefit of serving all our customers’ needs," said Lisa Ashley, spokeswoman for Port Houston.
The intermodal bridge between Houston and Dallas suffered from longer transit times and an imbalance in import/export volumes. The train takes three days on the rail because it isn’t a direct route, then two more days to unload the container, notify the BCO, dispatch a truck, and deliver the box, according to Maher. He said there were enough imports heading from Houston to Dallas but probably not enough exports to support traffic in both directions.
Shippers that had been using UP’s intermodal service to move containers from Port Houston to Dallas should explore truck options with their providers to have a plan in place by the end of April.
Contact Ari Ashe at firstname.lastname@example.org and follow him on Twitter: @arijashe.