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Wendy Reuer, Published November 02 2012

Regional railroad laying down tracks in industry

BRECKENRIDGE, Minn. - Red River Valley & Western Railroad is on the right track for continued success after 25 years in business.

The Breckenridge-based railroad runs a yearly average of 55,000 carloads on 577 miles of track stretched mostly across southeastern North Dakota, from Wahpeton to Edgeley, and as far northwest as Maddock, a small town southwest of Devils Lake.

RRVW has a fleet of 14 locomotives and has hauled nearly 1 million carloads of products such as grain, soybeans, sugar, fertilizer, coal, aggregate and farm machinery for clients.

Ninety-five percent of its business is in transporting agricultural products, said RRVW President and CEO Andrew Thompson. The railroad hauls products for 33 grain elevators, 16 ag processing companies, 12 fertilizer dealers and five manufacturers in 44 communities.

The number of rail miles hasn’t expanded since the company began operations in 1987 with the purchase of lines from rail giant Burlington Northern, Thompson said.

But the amount of business has. Business has tripled over the past 25 years and employee numbers doubled from the original 45, he said.

Many of the first employees are still with the company, said Sharon Trudell, vice president of marketing for RRVW.

Just before RRVW was founded, Burlington Northern transported about 19,000 carloads on the lines now owned by RRVW. This year, RRVW plans to operate about 56,000 carloads.

“When we took over, we increased the amount of trains that we ran,” Thompson said. “We started running two times a week and three times a week, depending on what our customers wanted.”

RRVW is now one of 553 shortlines in the U.S. It is considered the seventh largest shortline by miles in the country.

“What’s nice is that they’re local,” said Alex Richard, a grain merchandiser with Maple River Grain in Casselton. “Dealing with a local railroad is a lot easier.”

Richard said the grain company has worked with RRVW since it opened in 2004.

The advantage of being a shortline is the level of customer service the company can provide to clients, Trudell said.

“(We’re) able to customize our level of service to what our customers need.”

Pat Pithey, merchandising manager for Cargill Corn Milling, said RRVW has been a critical part of business at the Wahpeton plant since it opened in 1996.

“As a local service provider, the RRVW is very progressive and very customer-service oriented,” Pithey said. “They’re always looking for opportunities to provide different services.”

In addition to operating trains, the company maintains its own lines and equipment, spending about $4 million on track maintenance every year, and investing more than $21 million in facilities and equipment improvements over the years.

The company built a roughly 20,000-square-foot shop on its property in 2009. RRVW services its own locomotives and provides rail car repairs, maintenance and cleaning for other rail companies.

Although it has headquarters in the nook of southeastern North Dakota and western Minnesota, the booming oil business in far west North Dakota has touched the railroad.

RRVW provides a storage and staging area for oil cars. Trudell said the Bakken area has grown so quickly, infrastructure has not yet caught up. RRVW provides a relief of space needs by storing cars until they are needed. She expects as the oil business grows, so will opportunities for the shortline.

“We anticipate some of that will spread to our area in terms of new businesses coming to North Dakota,” Trudell said.

Readers can reach Forum reporter Wendy Reuer at (701) 241-5530