Freight shipping lags amid economic surge

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An improving economy is causing delays on the nation's railroads, and customers are worrying their freight will get backlogged as the peak shipping season approaches in the fall.

Some coal, chemical and retail companies are reporting delays that are hurting their businesses, although July normally is slow for them.

"We're keeping our heads above water and we can still see the shore, but it's a rough tide we're in," said John B. Ficker, president of the National Industrial Transportation League, a trade organization for shippers.

He attributes the demand for freight shipping to the stronger U.S. economy, which economists estimate to have grown at a 4 percent rate in the first half of the year.

Delays from backlogged trains and trucks are likely to get worse in the fall, when grain harvests are shipped to market and consumer goods arrive for the Christmas shopping season, he said.

The economy is "really surging, and that surge pushes freight to a new level," Mr. Ficker said. "Everybody wants to get their products moving while the opportunity is still there."

Companies as varied as J.C. Penney Co., Dow Chemical Co. and Arch Coal Inc. have been hampered by the delays.

Dow, which makes 150,000 rail shipments annually, was forced to reduce production of herbicide at its Midland, Mich., plant because raw materials are not being delivered on time. The company says the rail deliveries are taking 12.5 percent longer than normal.

"It's been ongoing for the last two months," said Bill Huff, Dow's director of rail operations.

J.C. Penney, the second-biggest U.S. department-store chain, checks rail capacity data to figure out ways to avoid delays.