The shuttering of Union Pacific’s Cold Connect coast-to-coast rail service, the former Railex operation that UP acquired 2017, was a surprise to many. For one, the service catered to demand for the transportation of fresh produce and other temperature-sensitive food and beverages between Washington, California and New York. It was also competitive with truck transportation in regards to transit time and cost.
According to a recent conversation with rail industry executives, there were extenuating factors that contributed to Cold Connect’s demise. Drayage costs have risen steadily in recent years. In addition, the Rotterdam, New York rail terminal was too far from New York City, Boston and other high-density consumer markets on the East Coast that factored largely in Cold Connect’s business model. This contributed to overall slower service, which is not acceptable for perishable freight.
The final coup de grâce was delivered by the COVID-19 outbreak, which disrupted domestic and international food chains and transportation rates.
There’s no disputing that North American rail providers, in general, need to improve service in order to attract more time- and temperature-sensitive freight, especially fresh food.
Meanwhile, there are services that make a strong case for the viability and investment attractiveness for refrigerated rail.
CN’s CargoCool service handles a variety of fresh, chilled and frozen food throughout a North American network comprised of 23 intermodal terminals, five logistics parts in Canada and the U.S., and rail connections to three coasts and six major ports. Its fleet of refrigerated rail cars is complemented with real-time visibility software that provides shippers with temperature reports in minutes and alerts on reefer status, door openings and more.
Class II provider Florida East Coast Railway is pursuing an initiative with Blackline Partners to develop a rail-served refrigerated cross-dock and cold storage warehouse at Port Everglades with direct rail service for boxcars as well as intermodal trailers and containers.
The facility’s temperature capabilities would include ambient, temperature-controlled, chilled, super-chilled, frozen and ultra-frozen. In addition, the facility would feature electronic cold pasteurization capabilities.
Industrial real estate development CenterPoint Properties is also building an International Logistics Center at Port Everglades, which is scheduled for completion by September. The project will contain warehouse, refrigerated warehouse, office space, and cross-docking facilities. A portion of the International Logistics Center will be activated as a Foreign Trade Zone.
Port Everglades is the leading Florida port for temperature-controlled cargo, with reefer cargo comprising 17 percent of its cargo mix.