April 8, 2020

ON RAILCAR STORAGE PT.3 Routing Railcars In and Out of Storage

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ON RAILCAR STORAGE is a five-part series written by Robert Skarzynski that explores the railcar storage industry in a concise and easy to understand manner. The insight found within was acquired by facilitating and structuring numerous Railcar Storage transactions with dozens of Railcar Users and Storage Facilities.

 

Chapters:

  1. Industry Overview

  2. Selecting A Storage Facility

  3. Routing Railcars In and Out of Storage

  4. Storage Facilities: Questions to Ask Your Customers (April 9)

  5. Railcar Users/Storage Facilities: Should I Use a Broker? (April 10)

Disclaimer: Routing railcars into and out of storage varies from railroad to railroad, and from facility to facility. It is best to get routing information directly from the storage facility, who in turn should get that information from their servicing railroad. The following outlines a general overview of the process.

ROUTING RAILCARS INTO STORAGE

Once the railcar user has selected a storage facility and the parties enter into a Storage Agreement, it is time to route railcars into storage.

Information Required by Railcar User

A railcar user will place instructions in the form of a Bill of Lading (BOL) with their servicing railroad, the process is often referred to as "billing cars" to storage. In order to do so, a railcar user will need the following information from the Storage Facility:

  1. Destination: Usually in the form of City, State, this can be the interchange location or a final location.

  2. Routing: Routing describes which railroads and interchanges are involved in a movement. There can be multiple ways to route railcars to storage, check with the Storage Facility - they should know.

  3. Physical Address: The address for the storage facility is required on the BOL either as the consignee or care-of-party. For storage of railcars containing or last containing dangerous goods, the address must be a physical address and not a PO Box.

Documents Required By Storage Facility

The following are the documents normally requested by the Storage Facilities prior to the arrival of any cars:

  • MSDS of last contents
  • List of Car Numbers
  • Bill of Lading
  • Certificate of Insurance

ROUTING RAILCARS OUT OF STORAGE

Routing railcars out of storage follows a similar process as outlined above. The railcar user puts their instructions with the servicing railroad and provides a copy of the Bill of Lading to the storage facility, who then makes the car available to the servicing railroad at the interchange.

How Much Notice is Required

The notice required to remove cars from storage varies between storage facilities. Some facilities can get your cars out the same day, some require up to 72 hours.

The more notice you can give a storage facility the better, a few things to keep in mind:

  1. During periods of high storage activity, interchanges can fill up quickly with multiple railcar user's cars competing for space.

  2. Speaking of interchanges, if the Servicing Railroad doesn't clear the track as scheduled, it can lead to a backlog of outbound cars. This happens more than you think.

  3. There may be planned maintenance or repairs on switching equipment which can cause delays when removing cars from storage.

Plan Ahead of Time

We'll touch on this more on our next chapter, however it is important to have a general plan for removing cars from storage and know shortline facility restrictions ahead of time. If a railcar user is aware that some cars may need to be handled differently on the way out (Example: lease return on a specific number of cars) letting the facility know prior to inbounding the cars allows them to stage the cars accordingly.

SUMMARY

I hope this helps with routing railcars to and from storage. In PT.4 of our series, we turn our attention to Storage Facilities and what they should be asking their customers.

Thanks for reading, if you have any comments, questions, insights, please let me know either through a comment on this post or by email at [email protected]

Rob Skarzynski

 

MGH Railcar is your one-stop-shop for all your railcar storage needs in Canada. Working with Shortline and other private track owners, we provide a single point of contact for responsive and simplified rail car storage communications.

Short or Long Term Railcar Storage / Suitable for any Railcar Fleet Size / Non-Hazardous and Hazardous Railcar Storage / Loaded and Empty Railcar Storage