CSX Acquisition of Pan Am Railways

johnpbarlow wrote: ↑Wed Feb 17, 2021 8:12 am So, based on PofNY/NJ data, if rail lifts = ~10% of TEUs then Port of Saint John could grow by 2028 to 33,000 annual rail lifts or 90 rail lifts (ie, containers) per day or 45 double stack well cars/day (or a single 2 mile long stack train every 3 days). That's not a lot of traffic for 1 RR let alone 2 if CSX somehow finagles its way into the mix.

Calling Mr. Cowford; Calling Mr. Cowford, come in please.

While of course I defer to the gentleman noted, a TEU comprises one 20ft Container. Therefore, if such be the case, a "double stack" car represents handling FOUR TEU's. This simply reduces by half the potential Saint John rail volume Mr. Barlow notes.

It certainly appears that Mr. Irving "owns the town" insofar as industrial activity goes. Nothing has come to our attention he is begging Chessie (or Topper) to come on in. His two "rinky dink" roads - FRA Class 2 in the US; who knows how TC similarly classifies rail lines - handle inbound timber for his mills from Maine. After Megantic, he appears to "avoid rail like the plague" for anything petroleum. That stunt of ocean shipping crude from Western Canada-Trans Canal-Saint John certainly suggests "he's done with rail" for crude. I guess the CN's circuitous route of "going East to head West" meets whatever rail needs he has.

Irving at SJ receives crude by rail as we speak.

Nestle sells Poland Springs to private-equity firms One Rock Capital Partners LLC and Metropoulos & Co. Recent negative news seriously harming brand.

https://www.vox.com/the-goods/2019/4/3/ ... ring-water

Gilbert B Norman wrote: ↑Wed Feb 17, 2021 9:10 am His two "rinky dink" roads - FRA Class 2 in the US; who knows how TC similarly classifies rail lines . . .

This is at least the third time I have chimed in to correct this: The Irving roads are far from rinky dinky. They are well maintained and in general are now Class 3 in the US and plenty of Class 3 in Canada. They have a lot of stick rail but it is well maintained trackage. Canada uses the same track classifications as the US.



is one example in Canada - this train is doing 30 MPH which as you likely know requires maintaining to Class 3 standard even if the MAS is between 25 and 40.

OK Mr. Newpy, I stand down on that one. You are out there and on the ground. I'm out here in Chicago, and removed by 40 years, of which 35 was my "third career" as a CPA in private practice, from my eleven year railroad career with a sick and dying road, who "hung around" while it was fun (also "pay dues" to a "saviour" until he was "purged") until it ceased to be that.

I just like trains... and CSX has plenty of them

roberttosh wrote: ↑Tue Feb 16, 2021 4:08 pm That's what is driving this deal, not the port of Portland.

The port of Portland probably isn't significant to CSX, but I know for a fact that the folks at Eimskip are very interested in working with CSX. It's been discussed elsewhere in this thread, but Eimskip has been trying to coordinate rail movements to and from Portland for years now, and PAR has been unable or unwilling to play ball. Eimskip moves a not insignificant amount of rail volume from Halifax on CN right now, and a lot of that could easily be moved through Portland if CSX is willing to work with them. Eimskip is also very eager to develop better onward connections south and inland from Portland, either by short-sea feeder services or by rail.

Related... this week NBSR added a new train for their internal fiber pipeline which runs 3 times a week, effectively meaning the CP traffic will move on a dedicated 907/908 and the Mattawamkeag and McAdam subs will have an extra train over the route each day. This is in advance of the Hapag-Lloyd traffic which starts this month as they begin a regular port of call in Saint John. All this brings me to the CSX/Pan Am deal and the recent conversation. I don't know if CSX is going to be interested in Saint John but if they are, I expect it will be a lot of traffic we have never seen. Maybe CSX will partner with CN for Halifax traffic to places beyond CN's reach? The Pan Am FRA Class 1 route from Keag to Bangor handles far less traffic than the CSX Panhandle subdivision handled, and we know how that ended. Like CN9634, I just like trains. I'd love to be surprised that CSX adds even more to the NBSR and it becomes even busier. I suspect worst case, CSX completes yet another subsequent transaction for the feeder routes in Northern Maine and we still have some variety. My guess is that in Jacksonville, the options are still being kept open and there isn't some plan carved in stone for how all of Pan Am will look. What we do know is they made sure NS will likely be kept out of the lion's share of Maine and Maritime traffic.

Not to sound like a broken record, but I will say it once again, CSX is not going to be interested in container traffic at the Port of Saint John. Even if Saint John were to eventually reach 200-300K annual TEU's, the vast majority of that business will be to and from the Maritimes, Northern New England, Quebec and Ontario. If they are ever able to develop any Chicago traffic, it certainly will be a drop in the bucket compared to what other CSX served East Coast ports handle today and it will almost certainly move via CP since they have a straight shot and have a much greater incentive since SJ is their only real East Coast option. CSX has zero incentive to pursue business there and their customers have less than zero incentive. CSX already has high speed high density Intermodal corridors from the US East Coast to the Midwest so what would be the pitch to have lines using say NYNJ go to SJ? First and foremost, you're adding an additional carrier (NBSR) and a lot more mileage, which would result in much higher rates and much longer transit times than from NY/NJ. That in itself would be a total deal breaker. Then you have the fact that this isn't even a DS cleared route and isn't going to be anytime soon. Add in tidal and draft issues, customs paperwork/border requirements and the fact that you're dealing with a postage stamp size port operation compared to the other big East Coast players where congestion/capacity would almost certainly become an issue if such volumes ever materialized.

Why do tidal issues keep coming up in discussions about SJ? As if DP World didn't consider that before investing $200+ million into expanding the port. Tidal forces in the bay of Fundy don't significantly impact operations of tankers or bulk ships in and out of Saint John, why would it impact the container terminal any differently?

I do also think it's worth considering that the port of NY/NJ is becoming increasingly congested and many steamship lines are unhappy with dwell times at the Maher and APM terminals. If CSX could, in theory, offer a 36 hour transit time from SJ to New York, that could open a lot of possibilities for shipping lines to route traffic bound for the east coast through SJ and onto CSX's east coast intermodal lanes.

There always have been and always will be tidal concerns at SJ. They obviously work around the problem but it is a well known fact and definitely not a selling point. Do you really think that NY/NJ is going to become a feeder market for SJ, where shipping companies that can land a container directly into the NY/NJ port complex on a MUCH larger vessel are going to spend an extra $1200-$1500 per container to rail them down from SJ?

The railroaders in Jacksonville aren't naive to what they are buying so they have some plan which likely has many options. Absent some sort of expansion of traffic from Saint John and the maritimes flowing to CSX I find it hard to believe the line from Waterville north has a long term future as part of CSX. A status quo sort of operation up here lends itself far more to a short-line that would be interested in hauling logs into Pleasant River and chips into Old Town than a class 1. It wouldn't be like that sort thing hasn't happened before. Think the current state of play in Wisconsin as CN is divesting the old WC branches.

Having alternative Mid-Atlantic and New England ports from the delays of NY/NJ ports (which are already overstrained before covid), customers would rather a viable option have their product delivered reliably and on time rather than sitting and for on a boat so long to become a staple in the foreground of the New York skyline.

CP bought the DM&E/IC&E and then later sold the lines in South Dakota. Irving would be the clear buyer for lines north of Waterville.

nomis wrote: ↑Wed Feb 17, 2021 9:24 pm Having alternative Mid-Atlantic and New England ports from the delays of NY/NJ ports (which are already overstrained before covid), customers would rather a viable option have their product delivered reliably and on time rather than sitting and for on a boat so long to become a staple in the foreground of the New York skyline.

There's a reason that ports like NY/NJ and LA/Long Beach are so busy and crowded, it's because that's where the shipping lines want to be, that's where the massive population centers lie and that's where the best economics are. If your theory were correct, then why aren't UP and BNSF moving trainload after trainload of International containers from the less busier ports like Tacoma and Seattle down to the clogged up LA basin?