https://gulfoilandgas.com/webp...innews.asp?id=928347

Union Pacific Delaying Deliveries and Preventing New Rail Orders from Being Taken



CF Industries Holdings, Inc., a leading global manufacturer of hydrogen and nitrogen products, informed customers it serves by Union Pacific rail lines that railroad-mandated shipping reductions would result in nitrogen fertilizer shipment delays during the spring application season and that it would be unable to accept new rail sales involving Union Pacific for the foreseeable future. The Company understands that it is one of only 30 companies to face these restrictions.

CF Industries ships to customers via Union Pacific rail lines primarily from its Donaldsonville Complex in Louisiana and its Port Neal Complex in Iowa. The rail lines serve key agricultural areas such as Iowa, Illinois, Kansas, Nebraska, Texas and California. Products that will be affected include nitrogen fertilizers such as urea and urea ammonium nitrate (UAN) as well as diesel exhaust fluid (DEF), an emissions control product required for diesel trucks. CF Industries is the largest producer of urea, UAN and DEF in North America, and its Donaldsonville Complex is the largest single production facility for the products in North America.

“The timing of this action by Union Pacific could not come at a worse time for farmers,” said Tony Will, president and chief executive officer, CF Industries Holdings, Inc. “Not only will fertilizer be delayed by these shipping restrictions, but additional fertilizer needed to complete spring applications may be unable to reach farmers at all. By placing this arbitrary restriction on just a handful of shippers, Union Pacific is jeopardizing farmers’ harvests and increasing the cost of food for consumers.”

On Friday, April 8, 2022, Union Pacific informed CF Industries without advance notice that it was mandating certain shippers to reduce the volume of private cars on its railroad effective immediately. The Company was told to reduce its shipments by nearly 20%. CF Industries believes it will still be able to fulfill delivery of product already contracted for rail shipment to Union Pacific destinations, albeit with likely delays. However, because Union Pacific has told the Company that noncompliance will result in the embargo of its facilities by the railroad, CF Industries may not have available shipping capacity to take new rail orders involving Union Pacific rail lines to meet late season demand for fertilizer.



The application of nitrogen fertilizer is critical to maximizing crop yields. If farmers are unable to secure all the nitrogen fertilizer that they require in the current season because of supply chain disruptions such as rail shipping restrictions, the Company expects yield will be lower. This will likely extend the timeline to replenish global grains stocks. Low global grains stocks continue to support high front month and forward prices for nitrogen-consuming crops, which has contributed to higher food prices.

CF Industries intends to engage directly with the federal government to ask that fertilizer shipments be prioritized so that spring planting is not adversely impacted.

“CF Industries’ North American manufacturing network continues to produce at a high rate to meet the needs of customers, farmers and consumers,” said Will. “We urge the federal government to take action to remove these Union Pacific rail shipment restrictions to ensure this vital fertilizer will be able to reach U.S. farmers when and where they need it.”



.

WTF?

This sounds like something out of "Atlas Shrugged".

Who is John Galt?

Most of the farms around here already have fertilized.

I use mostly Urea on my grass fields, and it's already done. It increased 230% in price since last year, and they had a minimum order that was twice what I usually buy, so I have some extra in the barn.

Under Joe Biden's economic plan, the cost of food will necessarily skyrocket.

quote:

Originally posted by Fenris:
WTF?

This sounds like something out of "Atlas Shrugged".

Who is John Galt?

I’ve been saying that in my head since the election. Looks like Elon musk might be one of them; maybe John G or not.

It’s stuff like this that confirms the great reset for me; you know this is done by unions.

Same shit is still occurring at sea ports on the West Coast. They just moved all the ships (AIS transponder data - Marine Traffic app) beyound the 50 mile limit (51 miles) so they’re not officially “in the queue”. All the boats for SoCal are actually resting off the coast of northern Mexico.

All the Chinese commercial ships have disappeared off IAS since last November.

Anybody have a source for why UP is doing this, or know the real reason for the change in policy?

https://www.trains.com/trn/new...ns-to-meter-traffic/

The seem to be indicating lack of Locomotives and shortage of labor. On the other hand they also seem to be indicating that there's a significant increase in their volume, such that they're hiring aggressively and pulling locomotives out of storage.

And they claim they're not the only ones with these problems - They're also saying "The big four U.S. railroads – BNSF Railway, CSX Transportation, Norfolk Southern, and UP – are experiencing service problems to various degrees, most of which are the result of shortages of crews and locomotives."

I'm skeptical...

Go read about PSR (precision scheduled railroading).

According to the link I posted, "In theory this shouldn’t be happening because the switch to PSR by most of the industry freed up a lot of locomotives, so nobody should be short,” And yet, here we are...

Sundance at Treehouse published an article yesterday on this. Not a deep-dive per-se but mKing some interesting and curious observations.

Union Pacific Rail Line Begins Restricting U.S. Fertilizer Distribution

As always, good reader comments on the article.

“Top two owners/stakeholders are Vanguard and black rock.”

quote:

Originally posted by SIGnified:
“Top two owners/stakeholders are Vanguard and black rock.”

There is nothing unusual about that. Vanguard and Blackrock manage mutual funds and ETFs for numerous individual and institutional investors, under the Vanguard and iShares brands. Vanguard has $2.0 trillion in ETFs under management, and Blackrock has $2.3 trillion.

https://etfdb.com/etfs/issuers...inancial-management/

Union Pacific's stock registrar shows that Vanguard holds custody of the shares, and Vanguard forwards the proxy information to the individual investors. Almost any S&P 500 stock will show Vanguard and Blackrock as the largest shareholders.

I attribute Union Pacific's lack of capacity to the end of the Keystone Pipeline.

Canada is awash in oil. The Canadian provincial government in Alberta has restricted oil production to prevent lower crude prices.
https://www.eia.gov/todayinenergy/detail.php?id=44396

They can't transport their crude - except by rail or truck. Rail is the most fuel and labor efficient way to get the crude to market.

^^^The Keystone XL Pipeline was not online, and was not scheduled to be completed until at least 2023. Keystone XL was Phase IV of the Keystone Pipeline System. The existing Keystone Pipeline system remains operational.