Unit trains increase shipping efficiency for steel producer

OmniTRAX’s logistics arm has begun arranging the transport of coiled steel from NUCOR Steel in Hickman, Ark. to pipe and rod manufacturer WEBCO in Sand Springs, Okla., using unit trains and its nearby transload facility for the first time.    Privately-held railroad operator and terminal services provider OmniTrax is reengineering part of a major steel producer’s supply chain to increase efficiency and just-in-time production for one of its customers.
   OmniTRAX’s logistics arm has begun arranging the transport of coiled steel from NUCOR Steel in Hickman, Ark. to pipe and rod manufacturer WEBCO in Sand Springs, Okla., using unit trains and its nearby transload facility for the first time, the company said Friday.
   NUCOR previously shipped the steel coils on one or two train cars per week. Using a dedicated train allows WEBCO to quickly pick up the commodity as needed to keep its plant operating.
   OmniTRAX Logistics recently managed the transport and storage of more than 10 million pounds of coiled steel using a 50-car train. The 225 steel coils, each weighing 45,000 pounds, were hauled by BNSF Railway from origin and interchanged to the Sand Springs Railway Co., a short-line railroad managed by OmniTRAX. The steel is stored at OmniTRAX’s transload facility in Sand Springs, where flatbed trucks pick up the material for delivery to the plant.
   In the past, such a large quantity of steel would be moved by barge down the Arkansas River. However, that created logistics challenges for WEBCO because the river terminal at destination was still 50 miles away, according to an OmniTRAX representative.
   “This shipment demonstrates that rail is a competitive option in many instances where it hasn’t been utilized previously,” Tim Eklund, vice president of transload and logistics at OmniTRAX, said in a statement.
   NUCOR and OmniTRAX plan to continue supplying WEBCO by shipping steel on a unit train every couple of months, the representative said.
   Railroads and logistics providers are increasingly taking advantage of bulk transload facilities that were established to support the movement of specialty sand and other materials for the shale oil boom , he said. As domestic oil production has slowed because of oversupply, companies are looking to diversify their operations to other commodities that can move in the same way.
   The Sand Spring facility pre-existed the oil development rush, but other OmniTRAX facilities in Illinois and Colorado, for example, were originally set up for the fracking industry.
   OmniTRAX Logistics Services operates transload and terminal facilities on OmniTRAX–affiliated railroads located in Windsor, Colo.; Brownsville and Borger, Texas; and soon in Grand Forks, British Columbia, and Stockton, Calif.  Through these existing facilities, OLS handles a diverse range of commodities, including industrial products, steel, building products, frac sand, chemicals and plastics.
   OmniTRAX operates 21 short-line railroads.