(The following story by Brian Nearing appeared on the Albany Times-Union website on March 27, 2010.)
ALBANY, N.Y. — At Hillcrest Foods, owner Chris Barkyoumb does a little bit of everything, including fixing the delivery trucks. So it’s not surprising that he’s added some knowledge about the workings of railroad tracks and freight cars to his repertoire.
To Barkyoumb, who moved his 25-year-old baking supply and speciality foods business to Wilton last year from its original location about 25 miles north of Burlington, Vt., the chance to add a rail spur was a way to cut his fuel and shipping costs by switching from trucks to trains. And that switch also carries another benefit — lowered emissions of carbon dioxide and other greenhouse gases for every mile that his supplies travel.
The future of railroads in a carbon-constrained economy drew a lot of attention in November, when legendary investor Warren Buffett plunked down $26 billion for the Texas-based railroad Burlington Northern Sante Fe. For Buffett, the investment came down to simple math — a train can move a ton of freight more than 430 miles on a gallon of fuel, about three times further than if moved by truck. And for every rail car used, more than three trucks can be kept off the roads, which extends highway life and keeps worn-out tires out of landfills.
According to the Association of American Railroads, every ton of freight that travels a mile by train results in two-thirds less emissions of CO2 compared to freight that moves by truck. And that advantage could widen in the future; this summer, freight railroad CSX announced plans to cut its CO2 emissions another 8 percent by 2011 — equivalent to 5.6 million barrels of oil — under a voluntary federal environmental program.
Buffett declared that railroads, whose heyday may once have appeared long past, now are “in tune with the future.”
That’s a conclusion that Barkyoumb, who started working as a youngster on his family’s chicken farm, reached years ago when he started looking for a place to expand his business and also a way to cut rising fuel costs from truck runs to Boston, New York City and New Jersey. He ships food supplies to restaurants, schools and bakeries from Maine to New Jersey, including Mrs. London’s Bakery in Saratoga Springs.
“My fuel costs had gone up so much during the past 10 years, that I started looking for a place with a rail siding. I deal with commodities that are heavy, like flour and sugar,” he said. And some of his customers were beginning to look for ways to reduce the carbon footprint of the food they bought, with one going so far as to switch suppliers out of concern that the cheese supplied by Hillcrest was coming too far by truck.
Barkyoumb’s hunt for a new home, which lasted seven years, led him to a vacant 40,000 square-foot warehouse on Edie Road that, coincidentally, also had previously housed a food supply business. In addition to storage and freezer space, the property came with a 400-foot rail spur to the warehouse that had not been used in the previous three years.
He bought the warehouse in October 2008, and began making some upgrades to the building, such as energy-efficient light fixtures, and adding better insulation to a walk-in storage freezer. He set up a deal with a flour mill in North Dakota to ship to him by rail, and planned to receive his first 160,000-pound load last spring. Then, a week before the freight car was due to arrive, Barkyoumb learned that 60 rail ties needed to be replaced, which meant an outlay of $20,000.
But the work got done in time and, so far, Hillcrest has received eight rail deliveries, with another set up for mid-March. “We are running a car roughly every two weeks. I’m saving about $1.50 per bag of flour compared to trucking it up from Boston,” Barkyoumb said. But because rail deliveries cannot be made on short notice, like truck runs can, he has to carry a bit more inventory that he used to.
“We are learning how to handle our rail spur,” he said. “It’s something that you have to maintain, like your driveway.” The spur is making his business more competitive on pricing, and he is looking at possibly extending his deliveries to include produce from the West Coast, like tomatoes or raisins.
Hillcrest now employs about 25 people, having added six new positions during the last year. And he is considering extending the spur and adding a second freight door to the warehouse, so he can unload two rail cars at the same time. That would require a $75,000 investment, something that Barkyoumb hopes might be assisted through energy efficiency provisions of the federal stimulus program.
“Even though it might take me a while to recoup that, I can see the potential down the road,” he said.