Last week, ISRI submitted comments in response the Surface Transportation Board’s (STB) proposal to revoke the exemptions for certain commodities including ferrous and paper scrap.
If this change does occur as proposed, it would permit the scrap recycling
industry to challenge rates through the STB administrative process to foster
sound economic transportation conditions, maintain reasonable rate where there
is not effective competition, and prohibit predatory pricing and
practices. These exemptions being contested for scrap materials have been
in place for over twenty-years when the transportation markets were very
different when the predecessor agency, the ICC, concluded that regulation was
not necessary to protect iron and steel scrap shippers from potential abuses of
market power. However, based on major changes that have occurred to the
transportation markets since 1995 when the exemptions were granted, the Surface
Transportation Board initiated a review of rail data including the confidential
waybill samples from 1992 – 2013, the length of hauls, and percentages of tons
moving less than 600 miles. This data led the STB to propose revoking the
exemptions based on the STB finding that there has been an increase in the
railroad’s market power of scrap shipments. ISRI will also be filing reply
comments shortly to respond to the railroad’s objections to revoking the
exemptions. For more information, please contact Billy Johnson at (202) 662-8548.
Leadership Update Main