SIOUX FALLS, S.D. (KELO) — The train a driver is waiting for at a crossing could be carrying ethanol which ends up in South Dakota service station, cement products for a neighbor’s landscaping project or a father-in-law’s corn to a processor.
Each day, trains carry thousands of pounds of goods across hundreds of miles of railroad track in South Dakota.
One grain railcar can hold up to 287,000 pounds, including the car, said Jack Dokken, the administrator for the office of aeronautics, railroad and transit, for the South Dakota Department of Transportation.
In 2015, 17.1 million tons of freight was moved by rail in South Dakota, according to the state’s 2017 freight plan. That was projected to increase to 25.2 million tons by 2045.
Trucks hauled the majority of freight in 2015 with 111.1 million tons, according to the state. That’s about 67% of all hauled freight. Tonnage was projected to increase by 23.5% to 137 million tons by 2045.
Now, as the U.S. is still in the midst of a shortage of truck drivers, according to multiple sources including the Journal of Commerce, rail remains a vital piece of freight shipping.
The South Dakota DOT has been working to make sure the rail system stays in shape to handle existing and future freight needs.
The state has spent about $53.4 million on railroad improvement projects since 2014, Dokken said.
That’s about $400 million less than the $455 million price attached to about 27 projects included in the 2014 South Dakota rail plan.
Still, $53 million is a significant investment, Dokken said.
The state is now seeking requests for proposals for another rail plan study this year, Dokken said.
Rail system crosses the state
Like a highway system, rail lines crisscross South Dakota in a combination of short line and longer rail lines, or Class I, such as BNSF.
The line from Mitchell to Rapid City is an example of short line rail system in the state.
Short line railroads are an integral part of the rail system in the U.S. but carry less less freight than major railroads, according to the U.S. Department of Transportation
“While Class 1 railroads generate over 95% of all freight rail revenues in America,
they own and maintain less than 70% of America’s rail miles. Most of the remaining rail miles are owned by small and medium railroad companies, including short line railroads that serve a small number of towns and industries, the “Beyond Traffic 2045” U.S. Department of Transportation federal report said.
The map from the South Dakota Department of Transportation shows the ethanol plants and train loading facilities in the state as of 2016.
David Lambert, the acting chief executive officer of the Mitchell Area Development Corporation, said the rail system is like a tree trunk. The major railroads (Class 1) make up the trunk and smaller railroads such as short line railroad lines make up the branches.
Dokken said connecting major lines with short lines and connecting short lines with lines in other states is part of South Dakota’s rail planning.
“It makes sense to take advantage of markets that have access. We do prioritize projects based on access to other markets.,” Dokken said.
For example, a short line in South Dakota may link to a BNSF line in eastern South Dakota that travels to the southern border. A short line may also link to a line in Iowa to help transport grain or ethanol or other products.
Although short line railroads are part of the overall rail system, the U.S. Department of Transportation, said many short line railroads don’t have the money to make investments to keep the lines in good repair.
“With limited annual revenues, these rail operators may struggle to meet current and future freight demand,” the 2045 study said.
South Dakota is one of the states which has invested in short line rail lines whether its through state ownership and repairing lines or working with operators on improvements.
Lambert said the Mitchell area is fortunate to have Watco as the owner because it has a history of rail improvement in states where it owns rail systems.
Why spend money on projects on a system that carries less than 40% of the goods in the state?
Dokken said railroads are a vital part of the state’s freight transportation. They contribute to the economic development of towns and cities. They are critical to the agriculture industry.
Lambert said South Dakota is at a crossroads. Companies are looking for ways to reduce shipping costs and find other efficiencies, he said. Railroad can help with that.
Also, agriculture is the state’s main industry. Railroads and agriculture are intertwined.
As the state tries to expand value-added agriculture processing and industry, the railroad line is a natural partner, Lambert said.
More trains mean less wear on S.D roads
While the trucking industry has its place in the transport of freight, Popular Science published an excerpt from “Power Trip” by Michael E. Weber on May 9, 2019, which advocated for the expansion of the freight railway system.
Freight railroads take 6.6 million truckloads off South Dakota roads annually, according to Go Rail. According to Go Rail’s website, it is an advocacy and education group of railroad supporters. One of the advocates highlighted on the website is Benjamin Snow, the president of the Rapid City Economic Development Partnership.
A move to increase freight transportation would improve the safety of roads but also the conditions, Weber wrote in Popular Science.
Fewer trucks means less wear on roads and in populated areas, less congestion on roads, according to multiple state transportation plans and studies.
If you are a taxpayer in South Dakota, a train that holds you up in traffic could also be saving you money on road construction.
Other benefits of rail transport include less greenhouse emissions than from other transport such as struck.
Trucking is the single largest contributor to freight-related air pollution nationally, according to the “Beyond Traffic 2045” U.S. Department of Transportation federal report.
Go Rail said that in South Dakota in 2019, “Moving freight by rail prevented 1.46 million tons of greenhouse gas emissions, the equivalent of taking 287,000 cars off the road or planting 22.2 million trees.”
Carbon Brief cited an International Energy Alliance study that said “If all services performed by railways were instead carried by planes, cars and trucks, transport-related greenhouse gas (GHG) emissions would be 1.2bn tonnes of CO2-equivalent (GtCO2e) per year higher.”
Agriculture industry runs with rail
“The advantage from the railroad has to do with how much grain they can carry,” Dokken said.
The 287,000 pounds carried by a rail car, “That’s a lot different than a semi-truck,” Dokken said.
Dokken pointed to the shortline rail system from Mitchell to Rapid City.
“Prior to 2010, there was almost no usage of the Mitchell to Rapid City line. Now to date, they’re looking at shipping over 10,000 cars annually,” Dokken said.
The state had owned the rail line and leased it to various operators over the years, said Lambert, the acting chief executive officer for the Mitchell Area Development Corporation.
A prior operator had used state money to revamp a portion of the line but the potential really picked up when the state of South Dakota sold the line to Watco, a company that owns and operates multiple lines and railroads in North America. Watco is based in Pittsburg, Kansas.
“Watco has a track record of coming in and investing in shortlines and actually upgrading them,” Lambert said.
“Agriculture is the primary driver in the central part of the state,” Lambert said.
A grain terminal already exists in Kimball and another is slated to open in Kennebec. Both use the railroad.
Shipping by rail often opens up markets on either coast to grain producers and grain handlers. The result is often better prices per bushel for grain.
According to the Soy Transportation Coalition, “Depending on the size and capacity of the rail cars, a 110 car unit train can accommodate approximately 366,000 – 403,000 bushels of soybeans.”
Elevators use the railroad but so do ethanol plants or biodiesel plants.
For example in February 2021, 15,363 barrels of ethanol were moved by rail in the U.S., according to the U.S. Energy Information Administration. The number was 20,575 in January 2021 and 20,455 in December 2020.
Who else can use rail?
The Mitchell area shortline is one example of the potential growth for railroad use. Industry doesn’t need to be on the rail line in order to benefit from it.
Lambert met with a manufacturer’s group of 10 members from the Mitchell area on May 11. All of them were interested in future use of the rail line.
Mitchell is potential site for a transloading facility which means raw product can be taken from a train and left at the facility.
Manufacturers, such as those who use raw steel product, can then pick it with trucks and bring it to their manufacturing facilities, Lambert said.
Lambert also looked east to Spencer, which is the site of a major quarry.
“There’s a lot of gravel and large aggregate that’s currently buried in places in eastern South Dakota,” Lambert said.
Spencer , South Dakota has one of the largest quarries in South Dakota and they ship a ton of product by truck, Lambert said.
“It’s not condusive enugh for them to via rail but have they discussed doing via rail? Absolutely. Would they love to do it via rail? Absolutely,” Lambert said.
Lambert said he needs try and link a company such as that will rail shipping which would save the company money and increase profitability.