Hurricane Harvey: Transportation Impacts 08/31/2017

Hurricane Harvey has caused widespread flooding and wind destruction along the Texas Coast and western Louisiana over the past several days. The system knocked out power, displaced residents, and closed major roads, all of which have forced commercial vehicle operations to curtail or halt activity in the region. Service delays and disruptions may continue indefinitely for inbound and outbound shipments in Texas and Louisiana.

Transportation Mode Updates from Carrier Assessments

Carriers are anticipating substantial impacts on freight moving in and out of the affected areas for weeks to come. As such, open and active communication between carriers, customers, and service providers is encouraged.

Bulk: Carriers are working to mitigate impacts to customers by leveraging the capabilities of operations managed outside of impacted areas.  Many tank wash locations in the Houston area have been significantly impacted by flooding, which may influence wash decisions and equipment availability even as access improves.  Road accessibility in and around Houston is improving. However, a high percentage of the access roads are still not available.  With improving road access, some operational restoration in the Houston area may be possible by Friday, September 1st, dependent on ability to inspect equipment and driver availability.

Truckload: Carriers continue to monitor and adjust to the catastrophic event occurring in Texas and Louisiana. To provide both plausible and feasible solutions to customers, shipments will require communications prior to acceptance. Loads need to be tracked and traced every few hours. Capacity is extremely tight. Some operations have seen outbound TX loads at almost $4 per mile and inbound loads at even higher rates.

Less-than-Truckload: Carriers have suspended pickups and deliveries in areas directly affected by flooding. Although Houston and surrounding cities are the most immediate impacted, the capacity disruption stretches nationwide. Service into/out of Texas and Louisiana depends on road accessibility and shipping/receiving sites’ operational status.

Intermodal: Local (Houston) facilities currently may not be operating. A return to service for local pickups or deliveries is not projected before Tuesday, Sept. 5 as continued assessments of roads in the area are underway.  Additionally, the railroads are holding traffic at origin for shipments destined to Houston, Laredo and Mexico (BNSF in Chicago, KCS at IFG in Kansas City, and CSX in Marion). There are several trains in transit that are currently staged. Los Angeles is allowing intermodal traffic to in-gate, but is moving it to Kansas City to hold.

Rail: Rail traffic into and out of the Houston area has been suspended at this time.

BNSF – Several BNSF subdivisions remain out of service due to multiple washouts and high water reported. All traffic destined to/originating from Houston, as well as traffic scheduled to route through Houston, remains suspended. All operations at BNSF Houston-area railyards and facilities, including the Pearland Intermodal and Automotive facilities, are also suspended as road closures continue to limit access to these locations. There is currently no estimate on when these facilities may reopen.

Given the size and scope of this historic flooding, normal train flows in the area are not likely to resume for an extended period. Customers should expect continued delays on shipments scheduled to move through the area.

BNSF crews will be conducting inspections and beginning repair work today in some locations. BNSF Service Update – Hurricane Harvey

Canadian Pacific – A number of embargoes have been issued by Foreign Roads due to extreme weather conditions in the Texas area given the impact of Hurricane Harvey. Customers with loads or empty private cars to move are encouraged to bill shipments to alternate locations not impacted by the embargoes where possible. All other traffic will need to be held at the current location.

Kansas City Southern – Since Friday, August 25, 2017, the lane between Kendleton, TX (Houston) and Laredo, TX, has been closed due to Hurricane Harvey resulting in a Force Majeure being declared for KCSR and KCSM and an embargo for impacted areas on the KCSR network. These remain in effect.

Thus far KCS has not sustained significant damage to its infrastructure.  KCS continues to monitor the situation which has expanded and is now impacting new areas on the KCS system, namely Beaumont, TX, and Lake Charles, LA.  KCSR Service Update – Hurricane Harvey

Norfolk Southern – Due to the historic rainfall and flooding resulting from Hurricane Harvey in the Gulf region, Kansas City Southern (KCS) has declared Force Majeure and has issued an embargo on all shipments destined to Laredo and Mexico. As a result, Norfolk Southern stopped accepting shipments at all origin facilities destined to Laredo and Mexico as of 11:00pm EDT Monday August 28th.

All shipments in-gated prior to the aforementioned gate closures will be loaded onto railcars, staged, and advanced to destination once the routes to Laredo and Mexico are deemed safe for movement. NS will not be able to unload and return shipments once they have been loaded. NS Service Update – Hurricane Harvey

UP – Rail operations along the Gulf Coast from Brownsville, Texas to Lake Charles, Louisiana are currently suspended due to high water and storm damage. Routes through San Antonio opened up allowing us to run trains both north and south between San Antonio and Hearne, Texas. All Mexico gateways are open with the exception of Brownsville, Texas. Embargoes have been issued on all rail traffic destined to stations on the Gulf Coast and inland that comprise the Houston Service Unit. Active Union Pacific embargoes can be viewed here. The embargo is for all rail traffic, including intermodal equipment and automotive shipments. Customers should consider diverting cars away from the impacted area.  UP Service Update – Hurricane Harvey

Transportation Updates from Port, Depots, and Support Assessments

Vessel Traffic at the ports will reopen when channels have been deemed safe by the US Coast Guard.

Market Impacts & Highway Updates 

Market Impact

  • Spot rates are expected to spike
  • Capacity tightens as trucking companies allocate resources to assist in relief efforts
  • Long-term disruptions could drive fuel prices higher in the weeks ahead
  • Productivity could decrease due to out-of-cycle supply chain demands
  • Suspended rail service
  • Closures of regional shipping terminals and ports
  • Chaotic supply chains due to extra shipments and lower productivity
  • Damage to fleet vehicles could impact capacity as some vehicles may be taken out of service and salvaged, depending on the extent of the damage

Highway Updates

Approximately 100 roadways in southeast Texas continue to experience flood conditions. Travel is not advised in the affected areas due to rapidly changing water levels and unsafe conditions. Please see link below for specific details.

  • Houston-area interstates (I-45, I-10 and I-69), as well as US 290 and US 90 all have closures. TX Roadways Impacted By Harvey
  • Louisiana roadways reporting flooding/closures:
    • I-10 West is closed to traffic at Mile Marker 4 (before the Louisiana/Texas State Line) due to flooding on I-10 West in Texas. There is no flooding on I-10 West in Louisiana at this time.
    • I-55 in both directions
    • LA Roadways Impacted By Harvey