ISRI2018: Unclogging the bottlenecks

Truckers and railroads urge rapid turnaround times from scrap companies that want prompt service in return.


Above photo, from left: Mike Peters of Genesee & Wyoming Railroad Services,
Mark Lewon of ISRI and Utah Metal Works and Bill Sullivan of the American Trucking Association.

The scrap recycling industry in North America has enjoyed some good circumstances in 2017 and early 2018 in terms of pricing and flows into yards and facilities. According to panelists and audience members at a Spotlight on Transportation session at the ISRI2018 convention, held in Las Vegas in mid-April, however, an across-the-board industry challenge has involved shipping prepared scrap to its destination.

Mark Lewon, outgoing chair of the Washington-based Institute of Scrap Recycling Industries (ISRI), the convention organizer, moderated the session and opened by stating, “Transportation is a problem for all of us.” (Lewon also is president of Salt Lake City-based Utah Metal Works Inc.)

Regarding backups at the nation’s ports, Lewon remarked that he had visited the Port of Long Beach in California in February 2018 and saw “trucks just lined up” in both directions, carrying inbound and outbound containers.

Bill Sullivan, executive vice president for advocacy of the Arlington, Virginia-based American Trucking Associations (ATA), said addressing such bottlenecks is a priority not only for customers such as the recyclers in the room, but even more so for trucking firms that must pay the drivers’ wages and strive to maintain full schedules.

Sullivan backed up an earlier comment by Lewon that the best way for recyclers to attract and retain trucking service providers is to offer quick turnaround times when drivers visit their facilities. “Drivers hate [handling] loads where they’re sitting at the dock for a long time,” he stated.

Sullivan said the ATA estimates the truck driver shortage in the United States stands at 50,000 people. With the average age of drivers currently at nearly 51, the shortage may only worsen. He added that he has been encouraged by the Trump administration’s attitude of “looking to get stuff done” as far as regulations that may be discouraging new drivers from joining the industry.

While automation is held out by some as a solution, Sullivan said on behalf of the ATA, “We maintain driverless trucks are a long way off.” Thus, he said, the ATA is focused on “adding drivers.” Sullivan did praise technology and automation features that he cited as good for safety and possibly positive toward recruiting younger drivers with an interest in technological change.

Some bottlenecks may be best solved with infrastructure spending, said Sullivan, who remarked that the ATA is “working to raise the [national] gasoline tax.” He said the other option is highway tolls, which said “will cost more than raising the gas tax by 20 cents [which] we haven’t done since 1993.”

As much as the trucking sector, the responsiveness of the railroad sector has been a source of disappointment for many recyclers. Mike Peters, a senior vice president with Darien, Connecticut-based Genesee & Wyoming Railroad Services, which operates more than 120 short-line railroads, said the recycling industry represents about 6 percent of his company’s revenue (split nearly evenly between scrap metal and paper).

“I admit, doing business with railroads can be hard,” Peters told the assembled recyclers. “We try to simplify that process.”

Regarding a common complaint about railcar availability, Peters said Genesee & Wyoming is piloting a “complete visibility” system with a paper manufacturing customer to coordinate car availability between his firm, the paper company and a Class I railroad that serves the same papermaker. “This is a technological piece to what has been a low-tech industry,” he commented.

Ferrous scrap recyclers have long lamented the shortage of gondola (open-top) cars they use. Peters said gondolas are considered a “spot market” by railroads, who can thus be “reluctant to invest in a car that could take decades to pay off.” He said at Genesee & Wyoming, “We look for older ones to lease for a shorter period of time.”

As with the trucking industry, railroads also can have trouble recruiting and retaining personnel. Peters said railroads have found that armed forces veterans can be a good match. “We need people who can work outdoors and who can work odd hours, so it can be a good fit.”

ISRI2018 was April 16-19 at the Mandalay Bay Resort & Casino in Las Vegas.

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