Union Pacific railroad shipping limits generate complaints

OMAHA, Neb. (AP) — Federal regulators and shippers are questioning Union Pacific's decision to temporarily limit some businesses' shipments as part of its effort to clear up congestion across the railroad.

The head of the U.S. Surface Transportation Board, Martin Oberman, said Wednesday he's concerned about Union Pacific's increasing use of the embargoes because they disrupt operations of the businesses that rely on the railroad, and they haven't seemed to help its performance significantly.

Union Pacific has ordered companies to remove some of their railcars from the network more than 1,000 times this year, up from 140 times in 2018, according to the transportation board.

An embargo can force a business to consider cutting production or resorting to more expensive shipping options, like trucking, if that's even an option. And they can make it harder for other businesses to get the key products, such as shipments of chlorine used to treat water, or grain for feeding animals.

“The customer is bearing the brunt of the pain. You guys are still making money,” Surface Transportation Board member Robert Primus said, addressing Union Pacific executives during two days of board hearings this week.

For much of this year, Union Pacific and the other major freight railroads have struggled to deliver products on time and handle all the shipments companies want to move because they were short on crews coming out of the pandemic. The railroads have been improving throughout the year as they hired more workers, but regulators say they're still lagging behind where they should be. Union Pacific is using significantly more embargoes than any other railroad.

At the hearings, Union Pacific executives defended their practices, arguing that their embargoes are needed to help get the...