Transloading: A Case Study Of The Tucker Hill Perlite Project And Its Transloading Terminal

The cost of transportation of industrial minerals frequently is higher than the cost of the product. When a mine, industrial-mineral plant, or customer is served by a single railroad, because of the lack of competition, that railroad may in- crease rates and/or reduce service so that the economics of that mine, plant, or customer are affected adversely. Transloading of industrial minerals from rail-to-truck or truck-to-rail to improve economics and sales of product is not a new concept. However, transloading to create competition and reduce freight costs or to improve service is a relatively new concept brought on by the recent mergers of many of the main-line railroads, both in the eastern and western United States. For example, in 1998, with completion of the Burlington Northern/Santa Fe (BNSF) and the Union Pacific/Southern Pacific mergers (UPSP), the western United States has only two main-line railroads. The industrial-mineral producer, to reduce the cost of transportation or increase the level of service, must evaluate potential transloading opportunities in light of higher prices and reduced service brought on by reduced railroad competition. This paper discusses industrial-mineral transloading and examines the case history of the Tucker Hill perlite project in southern Oregon. The Tucker Hill project is a classic study of industrial-minerals transloading where the project would have failed without the transloading.