Supply Chain Optimization

More Humping

While 2 unions are threatening a walkout this week, if there isn’t a stoppage, there will be more humping. Even if there is a stoppage, when they come back to work, there will be more humping. Before your mind goes in the wrong direction, humping is a way of sorting rail cars onto trains that are (hopefully) going their way. This is done by slowly pushing cars over a small incline (hence the name hump) which they slowly descend giving time to throw all the switches to guide each car in the right direction. “Precision railroading,” championed by the late Hunter Harrison, had shut a lot of these “humps” down. Now, with less available labor, the old way, with some improvement, is coming back. And there were significant needs for improvement. I well recall car loads of steel coils being squished because the rail cars were not slowed enough resulting a major collision.

For example, With the two recently reactivated humps, Norfolk Southern now has six working humps and five idled ones

Future delivery prices are an indication of the direction the market may go. They specifically exclude all taxes.