RAILROADS MUST GET MORE MILEAGE FROM GRAIN CAR FLEET, EXECUTIVES SAY

RAILROADS MUST GET MORE MILEAGE FROM GRAIN CAR FLEET, EXECUTIVES SAY

With a shrinking fleet of covered hopper cars to carry grain, American railroads will have to increase the number of trips each unit makes to boost overall productivity, industry executives told the Railroad Equipment Finance '92 conference here.

Covered hopper cars that now make about 14 trips, or turnarounds, a year will be making 20 to 24 trips a year, said Elias Lyman Jr., assistant vice president of grain marketing and sales for Atchison, Topeka & Santa Fe Railway Co., Kansas City, Kan."Carriers are capable of wringing out additional (productivity) from their fleets," Mr. Lyman told conference attendees this week.

Speakers pegged the number of covered hopper cars for grain at around 105,000 units. At times of peak demand, this has led to a tightness in the supply of cars available for grain transport, added William Harding, president of Harding & Associates in St. Charles, Ill.

Using projections for future grain crops and exports, hopper cars will have to make a minimum of 16 turnarounds a year to fend off a shortage of units, said Tom Scott, vice president for transportation at Sparks Commodities, Memphis.

Mr. Scott's crop and export projections showed peaks and valleys over the past 10 years and into the future. That volatility in the grain market is one of the main reasons railroads remain hesitant to invest in additions to the hopper car fleet.

Grain also accounts for only a small piece, 7 percent, of the railroads' total tonnage and revenue pie, Mr. Lyman said, which also discourages

investments in hopper cars.