BNSF to implement temporary embargo on selected California-bound carloads

BNSF locomotives parked and lined up in a rail yard.

BNSF is planning a temporary embargo of westbound automotive shipments and specific agricultural and industrial commodities to address congestion in Southern California, according to a Thursday service advisory.

The embargo will take effect Monday for waybills that have a shipment date of Wednesday. The embargo will expire July 31 and doesn’t include intermodal shipments because they are managed using an alternate system, BNSF (NYSE: BRK.B) said.

“We have experienced a sharp increase in congestion throughout Southern California during the past few weeks due to several high wind events concurrent with the high levels of traffic seeking to move through the region,” BNSF said. “In addition, flash flooding from monsoonal rains caused a service outage earlier this week on a portion of our Southern Transcon near Laguna, New Mexico, approximately 70 miles west of Belen.”

As a result of the weather-related issues, main tracks at that location were out of service for several hours and temporary speed restrictions were implemented as crews repaired and inspected tracks, according to BNSF. That activity has brought about additional congestion and reduced fluidity on the Transcon, BNSF said. The Southern Transcon is BNSF’s main line from Chicago to Southern California.

“The resulting impacts have affected our ability to effectively align resources with freight volumes, particularly the efficient utilization of train crews in the region,” BNSF said. “While this embargo action will lead to some additional disruption to our affected customers in the short term, we are confident that this aggressive measure will provide the additional capacity needed to recover velocity and improve cycle times more quickly, as well as assist with resource availability.”

Between Wednesday and July 5, the military and shippers of selected commodities for chemicals, energy products, grain and grain products may apply for a permit to move carloads during the embargo period. After July 5, these selected commodities will be exempt from the embargo.

Carload volumes of motor vehicles and parts over the past several years, as graphed by SONAR using Association of American Railroads data. The carloads represent volumes moved by the U.S. operations of Class I railroads. BNSF’s embargo could cause 2022 motor vehicle volume to fall below year-ago levels. (FreightWaves SONAR) ***To learn more about FreightWaves SONAR,*** ***click here***.

The embargo affects cargo destined for California from the following states: Alabama, Arkansas, Arizona, Iowa, Illinois, Kansas, Louisiana, Mississippi, Missouri, Nebraska, New Mexico, Oklahoma, Tennessee and Texas. Shipments from eastern points of origin and outside of BNSF’s network will be subject to the embargo if they interchange with BNSF at gateways in the previously mentioned states.

The embargo comes as BNSF and the three other major U.S. Class I railroads — Union Pacific (NYSE: UNP), CSX (NASDAQ: CSX) and Norfolk Southern (NYSE: NSC) — have been reporting service metrics regularly to the Surface Transportation Board. The data collection is part of a wider effort to improve rail service following a two-day STB hearing in April that reviewed potential root causes for the railroads’ network congestion.

Earlier this year, UP took steps to meter traffic in order to improve congestion on its network.

Subscribe to FreightWaves’ e-newsletters and get the latest insights on freight right in your inbox.

Click here for more FreightWaves articles by Joanna Marsh.