Hoosier Companies Take Advantage of Indiana’s Strong Railroad Network

The following is an opinion editorial provided by Andy Hendricks, President, Distributors Terminal Corporation and a member of Conexus Indiana Logistics Council:

Advanced manufacturing drives Indiana’s economy. And logistics – managing the flow of goods and services around Indiana, the nation and globe – is key to the continued growth and expansion of Indiana’s manufacturing base. Together, the two industries are the heart of the nation’s production and distribution hub, the “Crossroads of America.”

Much has changed in Indiana and the world in the almost century-and-a-half since Distributors Terminal Corporation, Terre Haute, Ind., was founded in 1868, when our company moved grains and cured meats in horse-drawn wagons. Today, we have multiple warehouse facilities, a fleet of trucks, state-of-the-art technology and same-day access to a majority of U.S. and Canadian populations – due in large part to our enviable geographic position and Indiana’s robust interstate system and network of ports, airports and railroads. We’ve come a long way from dirt roads and horses.

The state has an opportunity to continue to leverage our leadership position as the “Crossroads of America.” According to the U.S. Department of Transportation, freight movement is expected to double in the next two decades. To ensure logistics continues as a mainstay of our state’s economy we need to set the stage now, capitalize on our strengths and grab a generous share of that growing market.

One of Indiana’s strengths is its rail system. Indiana has 5,347 miles of railways serving 41 railroads (the nation’s fourth largest number) that carry more than 50 million tons of cargo each year. Rail is not only an asset to protect, but it is also ripe for growth.

Rail helps existing businesses in the state remain competitive in an ever-growing marketplace and it is one of the important services businesses seek when they decide where to expand, relocate or start up a new venture. As one of the most cost-effective modes of transportation, rail is the primary choice for Indiana companies shipping coal, agricultural products, steel, scrap metal and construction materials.

Rail has been a focus of a number of reports issued this year. The Governor’s Blue Ribbon Panel on Transportation Infrastructure and the Conexus Indiana Logistics Council have addressed opportunities for Indiana’s rail system. One opportunity includes improving rail service to Indiana’s ports by increasing the number of rail carriers that directly serve them, thereby providing enhanced access to new markets for Indiana companies.

Intermodal container service, which involves the movement of freight using multiple modes of transportation without handling the freight when it’s transferred between modes, is one of the fastest-growing transportation sectors and a tremendous business-attraction asset. Increasing intermodal rail would help Indiana companies avoid the bottlenecks for freight transportation in Chicago, reduce transportation costs, create time saving efficiencies and open access to additional markets.

As an example of the benefits of its rail strategy, the Blue Ribbon Panel said that, “Without direct intermodal service, Indiana has a competitive disadvantage in the cost of operating business across almost all industry sectors and in the attraction of new businesses to the state.”

In 2013, Indiana celebrated the opening of the Senate Avenue Intermodal Terminal, operated by CN Railway and the Indiana Rail Road Company, which provides direct West Coast intermodal rail service from Prince Rupert and Vancouver, Canada, bypassing Chicago. It also permits the flow of goods from Indianapolis to Shanghai in as little as 18-20 days. Opportunities exist to increase use of the Senate Avenue Intermodal Terminal and establish intermodal facilities in northeast, northwest and southwest Indiana to facilitate freight movement through the state.

Distributors Terminal is always looking for cost savings and faster service for our customers who use rail, whether intermodal or multimodal service. Clearly rail is an essential piece of Indiana’s logistics future. The good news is that we have tremendous opportunity to build on our current rail assets, adding significant value to Indiana’s position as the “Crossroads of America.”

Conexus Indiana Logistics Council is a group of leading logistics leaders who have identified critical priorities to drive the success within the logistics sector.