The Renewable Fuels Association (RFA) is taking the nation’s railroads to task for creating what RFA calls “oil-induced rail chaos”.
RFA president Bob Dinneen says disarray on the rail system in the first quarter of 2014 has forced ethanol producers to significantly curtail output. He says onsite ethanol storage tanks were full and, in many cases, the railcars and locomotives needed to ship ethanol were simply not available. As a result, Dinneen says, ethanol stocks in key regions of the U.S. have been depleted and prices have increased, contributing to higher prices at the fuel pumps.
The railroads blame the rough winter weather, but Dinneen says a more plausible explanation is the explosive growth in railcar shipments of Bakken and Canadian crude oil. He says the railroads have failed to adequately address the needs of all its customers, with U.S. economy is suffering as a consequence.