A Huntsman Corp. unit uses BethIntermodal Inc.'s Bethlehem, Pa., facility to help distribute plastic pellets in the Northeast, Mid-Atlantic and portions of the Midwest.
The operation replaces a terminal in Woodbury, N.J., that Huntsman operated until mid-2000. Huntsman closed its Woodbury polypropylene plant in April 1999 but temporarily continued to operate the terminal.
Finally, "we were selling the property and had to find another location," said Tom Buchholz, a Huntsman purchasing manager for rail and terminal logistics in Houston.
The transition allowed Huntsman to continue supplying regional customers of the former Woodbury plant, Buchholz said in a telephone interview.
Attractive rail rates from Huntsman's PP and polyethylene plants in Odessa and Longview, Texas, made the transition to Bethlehem possible, he said.
"It boils down to economics," he said. "Can you service the accounts? Does it affect customer relations? What are the numbers?"
BethIntermodal paved some areas and provides a secure yard for Huntsman to transfer material from rail to truck. Huntsman contracted with Bulkmatic Transport Co. of Griffith, Ind., to make deliveries.
Huntsman does not use BethIntermodal to transfer full cars except for one smaller customer.
Rail-car storage near customers is becoming a bigger issue. "We are doing a lot more supplier-management inventory," he said. "We have to carry inventory or safety stock."
Huntsman has added several sites to store rail cars closer to customers. "We expect to see that increase," Buchholz said.
Huntsman's Bethlehem operation is the largest of 20 transfer terminals that it uses. Chicago Heights, Ill., is second-largest.
Huntsman has sought ways to consolidate terminals. Acquisitions resulted briefly in Huntsman having three terminals in Nashville, Tenn.
BethIntermodal's parent firm, Bethlehem Steel Corp., operates nine short-line railroad facilities in Pennsylvania, Maryland, Indiana and New York and provides rail- and port-related services.
One of the nine, the Philadelphia, Bethlehem & New England Railroad, serves the Bethlehem site and connects with lines run by Norfolk Southern Corp. and Canadian Pacific Railway Co.
Bethlehem-based BethIntermodal transloads and distributes materials and products, stores rail cars and handles industrial rail switching. BethIntermodal was incorporated in 1988 and employs more than 400.
So far, Huntsman is the only plastics distributor using the Bethlehem location.