(June 23, 2:05 p.m.) Producers of California table grapes and other commodities will have a new, possibly cheaper way to get their product to the East Coast when Riverhead, N.Y.-based Railex LLC launches refrigerated rail service to Rotterdam, N.Y., in the fall.
The company broke ground in March for a 200,000-square-foot cold storage distribution center just off Interstate 99 in Delano, Calif.
The center will ship agricultural products from growers within a 150-mile radius, said Paul Esposito, vice president of northeastern region and corporate logistics.
Product will be stored in a temperature-controlled warehouse before itâs shipped to the East Coast on a 55-car train.
Railcars can handle a variety of packaging styles and are loaded inside the facility so as not to break the cold chain. Individual temperature-controlled cold rooms are available, as is office space for growers and customer quality control personnel.
The Railex facility is good news for the Delano area because it should create 300 new jobs and should result in a $32 million capital investment, Esposito said.
Completion is scheduled for September.
The company will guarantee five-day rail transit service between Delano and Rotterdam. It began offering a similar service from Wallula, Wash., to Rotterdam in 2006.
Railex uses 64-foot, refrigerated ARMN railcars quipped with global-positioning satellite tracking, fresh-air exchange and temperature control. The company uses Union Pacific Railroad and CSX Transportation as rail carriers.
Judging from the response of grape grower-shippers in the region, Railex may have a winner on its hands.
âA lot of people are looking at that, including us,â said Nick Dulcich, an owner and director of sales at Jakov P. Dulcich & Sons, Delano.
Dulcich said he heard about the plan during the recent United Fresh Produce Association show.
The new facility is less than two miles from the companyâs office.
Delivery time would be similar to that of truck transportation, but Dulcich is hopeful that the cost will be much less than the up to $12,000 cost of using a truck.
Dulcich is heartened by the fact that Railex already is shipping commodities like apples and onions in Washington, and he is hopeful that the service will be able to handle grapes as efficiently.
Railex even will take single-pallet orders, he said.
Dulcich & Sons likely will give the system a try, he added.
Any service that increases the availability of transportation from the West Coast to the East is a step in the right direction, said Chris Caratan, vice president at Columbine Vineyards in Delano.
The company is willing to transport product by any means a customer prefers, he said.
Railex rates âshould be very competitive with the truck market,â Esposito said.
âWe are going to be higher than conventional rail, but we will be able to offer consistency in pricing â we donât have the pricing fluctuations they see in the trucking industry,â he said.
The system has been working very well in Washington, Esposito said, and he expects grape growers to benefit from Railex as well.
âThey are very excited about the time of the year that weâre coming on and the service weâre offering,â he said.
Esposito said one Railex train carries the equivalent of 200 truckloads, and the companyâs Web site said using the carrier saves more than 5.2 million gallons of diesel fuel per year compared to using trucks, and reduces carbon dioxide emissions by 85,000 metric tons annually.