Importers of fresh produce – especially those shipping citrus products from Florida to South Korea and Japan – will soon have a viable “green” option for transporting these products across the United States for shipment abroad.

Norfolk Southern Railroad (NS) is introducing a new integrated refrigerated boxcar intermodal service that company officials maintain is truck-competitive for shipping cold chain products.

Dubbed ThoroughFresh, the service is currently targeting cold chain products from California’s Central Valley to the US East Coast by putting refrigerated box cars on the head of intermodal trains run by Union Pacific Railroad (UP) in the western US and interchanging them in Chicago onto NS trains that transport them to the northeast.

But the wider plan calls for filling the box cars with product for two-way trade; in other words, filling the backhaul cars from the East Coast to the West Coast.

UP operates an intermodal container transfer facility approximately 8 kilometres from the ports of Los Angeles and Long Beach.

This could be especially advantageous to shipments coming out of Florida. Florida Department of Agriculture figures indicate that the biggest export market for Florida grapefruit is Japan, where approximately 24% of the fruit went during the 2013-14 season.

Another significant market for Florida exports is South Korea, which has been growing at an annual rate of 20.7% since 2004, with substantial gains in exports of orange juice and fresh grapefruit. Exports of frozen orange juice have grown from US$6.3 million in 2004 to US$39 million in 2014, including a 22.1% gain from 2013 to 2014. Grapefruit exports have increased by 550% from US$740,000 in 2006 to over US$4.8 million in 2014. These two commodities combined account for 72% of all Florida exports in 2014.

The business for South Korea is particularly good given that in March 2012, the United States and South Korea entered into a free trade agreement. Under this agreement, tariffs for grapefruit imported from the US in 2014 are reduced by 50% from the 2012 rate and are scheduled to disappear completely in 2016. This should mean even more Florida-grown citrus will be heading to South Korea.

To add two-way volumes to the ThoroughFresh service and make the backhaul work, NS is working on adding additional locations such Atlanta (total transit time, 5.6 days door-to-door); Titusville, Florida, near Orlando (total transit time, 6.6 days door-to-door); Miami (total transit time, 8.5 days door-to-door), as well as in the Boston area; Chicago; Charlotte, North Carolina; and Kansas City. These too will be on NS property with the exception of those in Florida, which will be on property on the Florida East Coast Railway.

Particularly key in Florida, NS service connects with Florida East Coast Railroad (FECR), a 565-kilometre freight rail line located along the east coast of Florida which is the exclusive rail provider of Port Miami, Port Everglades, and the Port of Palm Beach. FECR interchanges with NS in Jacksonville, Florida – heart of Florida citrus country. FECR also operates an intermodal terminal in Atlanta that is located at Norfolk Southern’s Inman Yard.

NS spokesman Alan Julian says that the new locations should be up and running in the second half of 2016 through 2017 and into 2018.

Besides offering another option for shipping US products to Asia (and vice versa), Julian stresses that the most noteworthy aspect of the service is that it competes with single-driver trucks.

“The idea behind this non-traditional cold chain service is to offer customers service, speed and reliability,” Julian says.

Norfolk Southern’s ultimate vision is to have a network of intermodal terminals over which a wider variety of products can move from different growing regions to different consumer regions in the country.

Currently, NS is working with UP on its interim solution as its key partner whereby NS and UP railcars meet up for the interchange in Chicago. The service right now is concentrating on West Coast moves from California’s fertile Central Valley to the East Coast – primarily the New York City area where NS has an intermodal facility and is building a cold chain facility in Croxton, New Jersey. That facility, which is expected to open early next year, will offer approximately 7,500 square metres for fresh product and 1,400 square metres for frozen product.

Transit time from California to Chicago via UP rail is four days. In Chicago, UP operates an intermodal yard on the city’s west side where, each day, the intermodal rail cars are seamlessly interchanged with NS.

“This intermodal service is separate from our regular manifest,” Julian explains. “It is a faster interchange process.”

The service involves up to four trucks per car, which leverages refrigerated boxcar efficiency. Each day, 10-car blocks are allocated on NS Intermodal, and integrated into NS’s existing intermodal service capacity that involves 24Z and 20W daily trains.

“Once the train departs Chicago, it’s a 36-hour run to Croxton,” Julian says. “We are trying to learn the basics with the Croxton facility, and then quickly get the others established.”

Julian explains that customers who ship via truck generally do not have the expertise to piece something like this together. “It does not exist,” he says. “They call a truck. The truck picks the product up and delivers it to their customer. We are stepping in to manage that entire supply chain.”

In essence, the ThoroughFresh Service is essentially a truck-equivalent rate to pick the product up, move it behind-the-scenes through the rail-based supply chain, and deliver it to the ultimate customer. Customers can transport much larger quantities of product in one shipment via rail than by truck, Julian says.

“They can take advantage of the large capacity of railcars,” Julian says. “They can get anywhere from three, four or five truckloads per rail car, which creates economies of scale.”

In addition, rail offers an environmentally friendly way of transporting product. Locomotives are efficient, and trains take trucks off the road. “Rail offers a tremendous reduction in carbon footprint,” Julian stresses. “Companies are embracing this. Norfolk Southern is conscious of sustainable practices.”

Furthermore, there’s the issue of escalating shortage of truck drivers in the US. The American Trucking Association predicts a continued driver shortage, particularly for long-haul runs. “So we are not taking away jobs. We are taking that long-haul,” Julian says. “Truck drivers can still do the local pick-up and local distribution.”

Traditionally, refrigerated temperature-controlled products are handled in Norfolk Southern’s manifest service. “Generally, it’s hard to be competitive on produce that has a shorter lifespan,” Julian says. “To be truck-competitive, you must get shipments across country very quickly. We are able to do that.”

By Karen E. Thuermer

Correspondent | Washington