US-Mexico chem rail traffic to resume late July, early August

21 July 2010 19:26  [Source: ICIS news]

HOUSTON (ICIS news)--Rail lines that cross the Texas-Mexico border should be all clear for chemical traffic next week or by early August at the latest, the two major carriers said on Wednesday.

Rail service in northern Mexico has been disrupted for all carriers due to major flooding from Hurricane Alex, which hit northeast Mexico on June 30 and dumped 10 inches (25cm) of rain on the border region.

The storm caused significant track damage around the Monterrey and Saltillo areas, as well as on lines to Nuevo Laredo and Matamoros.

Union Pacific (UP) and Kansas City Southern de Mexico (KCSM) had been diverting traffic since then, but both carriers said this week that their lines should be ready for full service by the end of the month.

UP said on 15 July that its line between Laredo and Monterrey could be out of service for two more weeks, but spokeswoman Raquel Espinoza said on Wednesday the railroad hoped to lift the embargo before August.

"I'm not sure it's going to take two more weeks," she said. "It could be sooner."

KCSM said on Wednesday that the Anahuac Bridge near Nuevo Laredo should open sometime this weekend. David Starling, KCS president, said in a statement that the carrier planned to lift all current service embargoes imposed on July 3 "early next week."

Both railroads had been diverting border traffic through Brownsville-Matamoros, Eagle Pass and El Paso.

Laredo is the largest US-Mexico crossing, with 60% of the nations' trade passing through the southwest Texas city. Each day, 12,000 trucks pass through Laredo before crossing into Mexico.

Monterrey is Mexico’s third-largest city and a northern hub of industrial activity.

A source said the rail closings caused an estimated 30% hike in regional train shipment costs and forced companies to invoke contingency plans for diverting containers from trains to trucks to circumvent blockages.

A chemical exporter in Texas this week said the diversions had put a crimp in his acetic acid shipments to Mexico.

"We have had some problems crossing the product," the exporter said.

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By: Lane Kelley
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