By Tom Stundza -- Purchasing, 6/21/2006 6:00:00 AM
As demand for ethanol increases due to high gasoline and oil prices, more rail capacity in the Midwest is tied up. Union Pacific is handling a 57% increase in ethanol shipments, fueled by growing demand and continued development of ethanol unit trains, which provide faster transit times versus normal carload movement. According to the Des Moines Register, Iowa alone will produce 1.3 billion gallons of ethanol, most of which will be carried by rail out of Iowa. "You can ship some by truck, but the freight economics of it mean that St. Louis is about as far as you want to go," says Jim Glawe, controller of Corn LP in Goldfield, Iowa. Ethanol cannot be carried by pipeline because the impurities in the line would reduce the quality of the fuel. Iowa’s Department of Transportation has been providing financial assistance to help new ethanol plants construct rail spurs that will provide connections to railroad lines.
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