CHEMICAL NEWS & INTELLIGENCE June 21, 2006
ACC: US Rail Companies Hurting Chemical Industry
HOUSTON (ICIS news) - The American Chemistry Council (ACC) on Wednesday
accused US rail carriers of running a monopoly that hampered the
chemical industry while railroad advocates said natural gas costs was
the real problem facing chemical firms.
“The system is broken and Congress needs to fix it,” said ACC
representative John McIntosh during a testimony before the US Senate
Subcommittee on Surface Transportation and Merchant Marine.
McIntosh called on lawmakers to pass broad legislation to restore
competition and “ensure that railroads are covered by antitrust
statutes.”
“In 1970, there were 63 major US railroads. Today, there are just
seven,
and 90 percent of the rail traffic is handled by only five,” he said.
“America needs reliable freight rail service to remain strong and
create
jobs,” McIntosh added.
The ACC said nearly two-thirds of its members were “captive customers”
of a single monopoly railroad.
“Because we are captives, we have no way to negotiate, beg or buy
reliability,” it added. “Railroad monopolies are driving a golden spike
through the heart of American competitiveness,” McInto***old senators,
adding that “chemical companies often pay twice the amount of
competitive rail rates.”
Meanwhile, the Association of American Railroads (AAR) said price
should
not be an issue for the ACC, as chemical companies are “paying less
today for freight than they did 20 years ago.”
“I don’t know of many customers that can claim that,” said AAR
Vice-President for Communications Peggy Wilhide. “Their assertion that
we are driving a golden spike through the heart of the industry is
ludicrous,” she said, adding that the price of natural gas