Rail shippers hit by steel’s shift to trucks

Dec 08, 2009 | 11:10 AM | Lisa Gordon

Rail transporters are being negatively impacted in the current economic environment as steel customers are more concerned about delivery times than shipping rates.

"The credit crunch has forced customers to decrease inventory levels. We are seeing more truck shipments for speed in delivery," Craig Longardner, manager of materials and transportation at Steel Dynamics Inc. (SDI) told a roomful of attendees at AMM's Moving Metals Conference in Pittsburgh.

The smaller size of steel orders being placed has also made trucking more advantageous at the moment, Longardner added.

"Steel shipments at SDI are down and customer's shipments are down," he said, noting that the Fort Wayne, Ind.-based producer has been working with customers by keeping inventory earmarked for customers on the floor. "Customers don't have the money to fund inventory and steel mills responded quickly to short-term customer demands. Service center inventories are at record lows and people can't afford to keep inventory on load."....

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