News & Reviews News Wire STB orders Union Pacific to deliver trains to Foster Farms while it considers emergency order (updated)

STB orders Union Pacific to deliver trains to Foster Farms while it considers emergency order (updated)

By Bill Stephens | December 30, 2022

Foster Farms says it's running out of feed for chickens, dairy cows

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Train rounds curve in late afternoon sunlight
A Union Pacific grain train makes its way west across Wyoming in September 2018. David Lassen

WASHINGTON — The Surface Transportation Board has issued a decision requiring Union Pacific to deliver five trains of corn to the largest chicken producer in the western U.S. while the board considers a request by that producer, Foster Farms, for an emergency order that would require UP to prioritize shipments to the company.

It would be the second such order this year.

In a decision issued tonight (Friday, Dec. 30), the board has ordered UP to deliver five trains destined for Foster Farms facilities in Traver, Turlock, and Delhi, Calif., on a schedule provided by UP in a pleading to the board, which would see those five trains arrive between Dec. 31 and Jan. 3. The railroad must also provide the board with daily updates on the location of the trains, and by Jan. 3, provide the board with its plans to service Foster Farms over the next 30 days.

Those five trains will alleviate the immediate feed crisis, Foster Farms told the board.

Foster Farms told the board that it had again reached the point “where hundreds of thousands of dairy cattle are not being fed, and when millions of chickens will starve to death because of UP’s service failures,” according to a Dec. 29 filing that was posted on the STB’s website earlier today.

The Foster Farms facilities rely on 100-car unit trains of corn that originate in the Midwest. The company produces feed from the corn, which is then distributed to dairy farms, Foster chicken and turkey farms, as well as other poultry producers.

The STB issued an emergency service order in June that directed UP to prioritize shipments to Foster Farms [see “Union Pacific hit with STB emergency service order …,” Trains News Wire, June 17, 2022]. UP ultimately delivered more corn than Foster Farms could handle.

But Foster Farms said UP’s service began to slip in October and has worsened since.

“On Dec. 26, 2022, dairy cattle supplied by Foster Farms had been without feed for 10 days at its Turlock milling operations, impacting hundreds of customers overseeing thousands of cattle,” the company told regulators. “On Dec. 29, 2022, Foster Farms shut down all feed corn processing at its larger Traver facility, which cut off the feed supply to the rest of its approximately 400 dairy cattle customers, overseeing approximately 800,000 head of cattle. By early January, Foster Farms will be unable to feed any of the 40 to 50 million chickens it owns and/or supplies feed to in California. These chickens supply a major amount of the West coast premium poultry products to Foster Farms’ United States consumers.”

Foster Farms has transloaded corn from BNSF trains into trucks for delivery to its California facilities and has purchased locally grown corn in order to try to boost its supplies.

Union Pacific, in a reply today to Foster Farms’ filing, said that the Foster Farms situation “is largely the result of extreme winter weather that has affected many rail shippers, and UP is already taking all reasonable measures to alleviate that crisis.” It urged the board to at least let it deliver the five trains already en route before deciding whether to issue an emergency order.

— Updated at 8:55 p.m. CST with UP reply and board decision. Trains editor David Lassen contributed to this report.

23 thoughts on “STB orders Union Pacific to deliver trains to Foster Farms while it considers emergency order (updated)

  1. Are UP and Southwest Airlines owned by the same people? Up is the oldest single entity railroad in North America but they act like they have never seen a winter. As Vince Lombardi once said during a Packers/Giants game, “What the hell is going on out there?”

  2. Remember UP’s statement the first time Foster requested help? To the STB they asked the STB not to order service and that UP could handle it. Well, guess what. The order from the STB expired and now UP is right back in the same problem while the ink was hardly dry on their prior promise.
    Its no wonder Fritz won’t attend a shippers conference. He knows his butt would be the focal point and rightfully so. Hey, UP directors, how long are you going to put up with this?

  3. Rail regulation caused bad rail service and bankruptcies. ( I remember Penn-Central.) Government laws cost railroads half of their coal business. Coal created the post Staggers-Act rail prosperity, then the Government took that away. It if re-regulates it will finish the rails.

  4. It’s about time railroads get regulated again. Threathen UP with open-access in case of non-compliance. That should get you some results quickly.

  5. As a side note, the senior community where I live had lined up 15 prospective hires for servers in our dining facility. Only one showed up. GOOD help is hard to find.

  6. I trust, in the spirit of teamwork, that the UP C Suite team has offered to skip their New Years festivities and will be spending the weekend in the office trying to rectify the situation.
    Here we go again. This time it’s weather. Has the railroad never operated in winter conditions before? Maybe lack of resources (you know, simple things like manpower, reserve locomotives, things like that) had something to do with it? They state that trains A B and C loaded on such and such a date but ran into weather issues. It took you 5 days after a storm to finally move a train? And how many of these trains that were loaded arrived late at the loading facilities as empties to begin with due to crew and or power issues? Nine ways to Sunday to pencil whip things and pass the blame on to things like weather. Perhaps if there had been adequate crews and power in place to begin with there wouldn’t have been so many trains parked when the weather did hit? They site examples of trains loaded in mid December, but reading the article the issues started way before the onset of snow and wind. During the mid December hearings UP stated they were caught short handed because of a tight labor market and difficulty in hiring people. But yet I stumbled on an Wall Street Journal article from 2020 where the CEO was talking about REDUCING the workforce by 8 percent in 2020 due to the PSR operating plan of running more with less.
    Well, it seems to me that it has come back to bite them, and the industry in general. It’s a shame. This is not the UP I remember reading about as a young lad.

  7. Agree with the above comments. However lets not forget the chicken and beef industry has also been guilty of the same consolidation in order to lower costs and maximize sales, but concentrating pollution and risks to supply chaine disruptions.

  8. Put some teeth into it. Penalize the yellow peril $2 for every bird that dies waiting for food and $1000 for every dairy cow. Then, maybe then, UP will find a way to handle it.

  9. “Winter weather disruption”.

    They have service from New Orleans to Los Angeles. I get the weather was bad up north, but if you are routing your world through one yard (North Platte), well then these are the things that will happen.

    Maybe Foster Farms needs a supplier further south.

    When I think of UP trying to retask a consist across its network I can only think of of the movie “Patriot Games” where the head of CIA tells Jack Ryan “do you know how hard it is to retask a satellite Jack?” In other words bureaucracy at its best.

    1. They learned from Southwest Airlines. Southwest Airlines will tell you that if there’s a blizard in Fargo, it’s impossible to fly out of Cancun.

  10. Union Pacific is a JOKE!! An acquaintance sold his UP stock last year, telling me the company doesn’t care about customers at all. Businesses that neglect and ignore customer needs are doomed for failure. Yet UP will carry on, in spite of their way of doing things…they aren’t competing, because they don’t have to. So we have the STB directed emergency service order for Foster Farms, which obviously hasn’t solved things. It is time for re-regulation, because big rail is failing common carrier obligations. The decades-old Staggers Act created short-lived growth and success for big rail, and spurred the mega-merger era. The surviving carriers have little to no competition or incentive to fulfill common carrier obligations. Perhaps re-regulation will fix things. Threaten big rail with that or break these railroads up into the entities they were before the merger craze. Regional and short lines are providing the services needed by their customers, big rail pales in comparison, and UP is the poster child for inferior service. The STB will speak, I hope, and tell UP to poop or get off the pot.

    1. Everyone calls for the U.S. Government to regulate the railroads now. I remember when that was a big failure that resulted in bankruptcies and abandoned track – oh, and bad service! My Dad talked about waiting hopelessly for Penn-Central to send a switch engine to his company’s siding. By the way, this same government created laws that cost the railroads half or more of their coal business. Coal business was what really created the post-Staggers-Act rail prosperity. Now the rails are struggling (despite the stock run ups) and trying to survive by cutting costs. Goes around, comes around.

  11. It’s not going to change anytime soon. The end result will be business gets ran off to trucks and other forms of transportation and the big carriers will blame everything and everyone but themselves for their own corporate suicide. The rail industry will be a shell and frail and in complete disarray and disrepair and the major players that created it will disappear into the sunset.Oh just like the shambles of the railroad situation in the 70s they’ll surely blame the employees for all the failures of the top and the media as well as the public will believe them and we operating craft employees will get to hear the brunt of all the negativity that goes along with it. I’m no Nostradamus but it’s really starting to look like things will happen the way I predict.

  12. I thought the crew and equipment shortages were becoming a thing of the past with all the hiring they’ve been doing and the glowing, pat-ourselves-on-the-back reports we’ve been hearing. Gee, I guess that was all just more UP corporate BS. There’s a surprise…but I’ll bet profits are still at near-record levels.

  13. The Union Pacific is playing “chicken” with the California poultry producers and federal regulators?

    Yes, the Union Pacific is a real mess these days and I suspect they (UP) haven’t heard the last from Martin Olbermann and the Surface Transportation Board. Look out, UP!

  14. The apparent inability of our large, common carrier railroads to carry out their central tasks is astounding. Even after one intervention, they can’t keep up with basic service.

    1. Thomas it’s starting to sound like Southwest Airlines they just can’t seem to GET there act together. Southwest cancels thousands of flights and UP can’t move trains even in good weather.

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