Greater Memphis Chamber, local businesses: Memphis has cargo crisis, needs federal help
APRIL 22, 2021
MAX GARLAND | THE COMMERCIAL APPEAL
The Greater Memphis Chamber and local companies have asked a federal agency “to help resolve an inland rail crisis” creating backlogs, delays and rising expenses for Memphis importers, exporters and motor carriers.
The letter, originally sent to the Surface Transportation Board on April 14 and updated Tuesday, asks the agency to implement measures to address congestion and equipment shortages. The signatories include notable Memphis-based companies such as International Paper, Cargill Cotton, Ozark Motor Lines, Radians and Dunavant Logistics.
Climbing volumes of inbound cargo have caused “significant costs, delays, and consequences to supply chain participants” by overwhelming current intermodal infrastructure, it said.
These volumes, along with shortages of chassis used in transporting containers have contributed to the grounding and stacking of containers at rail ramps, it said.
“For example, one of five Class I railroads is currently reporting 1,600 boxes on the ground in Memphis and equipment shortages exceeding 600 chassis,” the letter said. “More than 3,000 additional loads are staged on trains outside of Memphis waiting to bring these trains in to off load. Volumes at these levels, under the current model, will simply exacerbate congestion, fees, costs, and gross inefficiencies in the supply chain.”
Storage fees continue to mount for import containers, despite rail congestion prohibiting access to equipment needed to move the containers, according to the letter.
The letter suggested the board implement measures including regulating storage fees, relaxing restrictions on chassis use and "exploring long-term models to avoid this type of congestion during future cargo surges.”
Memphis isn’t alone in experiencing supply chain congestion. Consumer demand has remained high amid the COVID-19 pandemic, but various restrictions and worker shortages have slowed shipping processes and bumped up prices.
Such bottlenecks were prevalent when the pandemic began in early spring as factories shut down across the globe. Since then, the crunch had gradually eased. But recent COVID-19 spikes, combined with a resurgence in customer demand, have sparked the direst shortages and delays yet.
The Surface Transportation Board regulates freight rail, with jurisdiction over railroad rate, practice and service issues.
An agency response to the letter was not available as of Thursday. The full letter is available on the Surface Transportation Board's website.