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UP capping storage fees for inaccessible containers in Chicago
Source
American Shipper
Post Date
07/13/2021

Union Pacific Railroad (UP) will cap the storage fees ged for ocean containers stacked and inaccessible in its Global IV terminal in Joliet, Illinois, after shippers and non-vessel-operating common carriers (NVOs) protested bills that exceeded $10,000 in at least one case.

The western US railroad announced that ning July 1 it will cap storage ges at $2,450 per container in the stack until a chassis becomes available. The cap will apply to containers already in the stack and new containers entering the stack.

“Union Pacific acknowledges the difficulty for both dray carriers and the railroad to efficiently manage the outbound movement of containers once they are in a stacked location,” the railroad wrote in its announcement Thursday.

Truckers, shippers, and NVOs argue it is unfair for UP to assess unlimited rail storage fees, a form of demurrage, when containers were unavailable through no fault of the cargo owner.

Al Hoodwin, owner of Michigan City Paper Box, said he had a single container stuck in the Global IV stacks for 50 days until TRAC Intermodal interceded on the company’s behalf in mid-June. Hoodwin told JOC.com that UP had ged him $11,000 for storage even though he sent multiple truck drivers into the Joliet terminal with their own chassis to retrieve the cargo, only to be turned away due to UP’s policy of only allowing containers to be premounted on rail-owned chassis.

Three NVOs told JOC.com they also have customers with containers stuck for more than 30 days with fees totaling at least $6,500.

UP argues its “no cherry-picking” policy allows yard workers to concentrate on loading and unloading trains rather than deconstructing and reconstructing stacks. Shippers, truckers, and NVOs countered that UP should not ge storage fees when it has provided no solution to access the containers. They also note that BNSF Railway, the other western US Class I railroad, does not ge storage fees for inaccessible containers.

Should rail storage be allowed for inaccessible boxes?

A coalition of Memphis-based shippers and truckers asked the Surface Transportation Board (STB) to intercede across the US in April. The Memphis coalition objected to paying any rail storage, arguing that the US Federal Maritime Commission’s (FMC) standards on detention and demurrage in ports should apply to railroads.

The FMC has ruled that a container must be available to a shipper before an ocean carrier or terminal operator can assess demurrage. If a container is unavailable through no fault of the shipper, demurrage cannot apply.

However, the STB unlikely has power to adopt the FMC standard or officially intercede through rulemaking because containerized rail was deregulated in the 1980s.


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