Western Railroad Discussion > Expect more copper out of Arizona, New Mexico, Utah

From Nov 10th issue of FreightWaves...

>> Arizona is the top American producer of copper, followed by New Mexico and Utah, and the volatile Arizonan mining sector quickly expands and contracts based on global commodity prices. Production, output, and employment are all up on strengthening copper prices. Arizona’s first new copper mine in a decade, Excelsior’s Gunnison Copper Project in Cochise County, is just a permit away from beginning construction. Over all U.S. copper production is up 21% since 2011.

>> "The key issue for the industry is whether the railroads can supply enough equipment to handle increases in mining production particularly now that the railroads have a long-term focus on coal and intermodal traffic," said the Arizona Department of Transportation in their multimodal freight analysis study. Flatbed trucking, which has already been on fire this year, should see increases in demand to move copper to port and to feed the American construction industry. <<

https://www.freightwaves.com/news/2017/11/10/expect-more-copper-out-of-arizona-new-mexico-utah

I take this to mean we will be seeing more copper concentrate moving between the mines in all three states, and smelters and refineries in the same three states, as well as other locations, at home and overseas.

Don Strack
http://utahrails.net/whatsnew.php

Do we have any smelters and refineries left? Thought most of them had been closed because business dropped off and the fact that they were the biggest polluters around.

A friend said he just saw the Katy unit leading westbound at Dateland, AZ, Sunset Route, at 0945 MST on a string of gondolas, probably an OCLGD of copper mine tailings from Clifton, AZ, mine via Lordsburg to Garfield, UT, smelter.  It was running 3x2 power.  Yesterday, it looked like an OGDCL went by the Cajon webcam at 1135, UP 7922 + 2 units, short train of empty gons like mill gons, no DPU, heading back to Clifton to reload with more copper tailings.

mapboy

Edit: The train with the UP Katy heritage unit was confirmed by Christina= RailFanAz as the OCLGD-10.

Went by Maricopa. AZ at 6am this morning Heading Westbound.

SouthWest RailCams
CA, NM, CO, TX, AZ
https://SouthWestRailCams.com

It was the OCLGD-10.

SouthWest RailCams
CA, NM, CO, TX, AZ
https://SouthWestRailCams.com

If the Excelsior Mine project is fully approved it would be located only 4 miles from the UP Sunset Route at Dragoon, AZ. Have to then wonder if UP will build a spur into the project area.

In the late '80's SP ran unit copper concentrate trains from Lordsburg, NM to the Port of Long Beach for export...the copper concentrate was from Clifton.

From what I hear any exports will continue to be shipped via the Port of Guaymas, Mexico.



Allen



Edited 1 time(s). Last edit at 11/11/17 10:20 by bradleymckay.

"Do we have any smelters and refineries left? Thought most of them had been closed because business dropped off and the fact that they were the biggest polluters around."

The Kennecott copper smelter and refinery at Garfield, Utah is still going strong. While not strictly a smelter, the US Magnesium refinery on the west shore of the Great Salt Lake is also very active and if I'm not mistaken, it's the largest single source of metallic Magnesium in the US. It is served by the UP.

Dick
Roosevelt, UT

bradleymckay Wrote:
-------------------------------------------------------
> In the late '80's SP ran unit copper concentrate trains from Lordsburg, NM to the Port of Long Beach for export...the copper concentrate was from Clifton.

There were also blocks of cars that ran in general freight trains. When I used to stamp the waybills (that shows how old I am) for those cars on the interchange desk at ATSF, the origin was Sahuarita, AZ on the Nogales Branch. For awhile the shipper was using the Port of San Diego which would have been good business for the SD&AE had it not been destroyed by a hurricane. The cars were taking the long way around, via L.A., to get to San Diego. I guess later they figured it was easier and faster to use Long Beach.

PHall Wrote:
-------------------------------------------------------
> Do we have any smelters and refineries left?
> Thought most of them had been closed because
> business dropped off and the fact that they were
> the biggest polluters around.

The ASARCO smelter in Hayden, AZ is still in operation.

The Freeport-McMoRan refinery (electrolytic) in Morenci, AZ.

I believe there is still an active refinery in the Globe-Miami area.

All are capable of producing blister copper.

Yes, there's a smelter at Claypool/Miami, it's having it's chimney/scrubber set-up refurbished currently to reduce emissions.



Edited 1 time(s). Last edit at 11/11/17 12:50 by exhaustED.

What used to be the Phelps Dodge smelter in El Paso was taken over by Freeport-McMoran and is still active.  The ASARCO smelter in El Paso is gone, but they still have active smelters at Amarillo and, as mentioned, Hayden.

mapboy

Not too far south of Arizona/Mexico border is the huge open pit copper mine at Cananea. It is owned by Grupo Mexico.



Allen

The only way this increase in copper business will come to the railroads is if the RR's decide they want the business and choose to be competitive with the trucking companies in terms of both rates and customer service.

Presently the ASARCO smelter in Hayden, AZ receives concentrate from the Mission Mine south of Tucson by truck because the Class 1 carrier that has trackage into the mine won't give satisfactory service and a competitive rate. In addition, all the copper anode produced by the Hayden Smelter is shipped out to the refinery in Amarillo by truck. Again because the Class 1 carrier doesn't want the business and won't quote a competitive rate and/or provide the necessary customer service.

As a side note, the Smelter in Hayden is set up for unloading concentrate by rail only. So, the trucks come to the plant, dump the concentrate on the ground for reloading into hopper cars for the trip to the smelter. Even with double handling of the concentrate, it is still cheaper to truck it....

Earlk Wrote:
-------------------------------------------------------

> Presently the ASARCO smelter in Hayden, AZ
> receives concentrate from the Mission Mine south
> of Tucson by truck because the Class 1 carrier
> that has trackage into the mine won't give
> satisfactory service and a competitive rate.

What would the estimated number of carloads per month be if it went by rail? It would be a short haul so maybe UP doesn't consider it profitable enough to throw locomotives and manpower at it. We know that 2 of the biggest expenses on the railroad are diesel fuel and employees...

> In addition, all the copper anode produced by the
> Hayden Smelter is shipped out to the refinery in
> Amarillo by truck. Again because the Class 1
> carrier doesn't want the business and won't quote
> a competitive rate and/or provide the necessary
> customer service.

I would think UP would want this business but their access to Amarillo would be via Stratford, TX and BNSF trackage rights. Trackage rights fees can be a business killer. The only thing UP seems to ship (or did ship) to the Amarillo area in any quantity is grain.


UP had been running copper concentrate unit trains from Deming, NM to the Port of Guaymas. I'm guessing the concentrate was from one of the mines near Silver City, NM. Not sure if these trains are still running or not. I don't remember why but BNSF was involved in this move somehow.



Allen



Edited 1 time(s). Last edit at 11/11/17 22:22 by bradleymckay.

bradleymckay Wrote:
-------------------------------------------------------
> Earlk Wrote:
> --------------------------------------------------
>
> > Presently the ASARCO smelter in Hayden, AZ
> > receives concentrate from the Mission Mine south
> > of Tucson by truck because the Class 1 carrier
> > that has trackage into the mine won't give
> > satisfactory service and a competitive rate.
>
> What would the estimated number of carloads per
> month be if it went by rail? It would be a short
> haul so maybe UP doesn't consider it profitable
> enough to throw locomotives and manpower at it.
> We know that 2 of the biggest expenses on the
> railroad are diesel fuel and employees...
> Allen

I did a tour of the Mission Mine two years ago, and IIRC they truck 100 tons a day of concentrate, or one rail carload.  So 30 cars a month.  If things haven't changed, the LKT21 local (Mo Tu Th) could take the loads from Mission Mine to Tucson.  The LKT72 Magma Turn (Mo We Fr) could take it to Magma, where the Copper Basin Railway (owned by ASARCO) could take it to Hayden.  That's three crews.

mapboy

bradleymckay Wrote:
-------------------------------------------------------
> Not too far south of Arizona/Mexico border is the
> huge open pit copper mine at Cananea. It is owned
> by Grupo Mexico.
>
>
>
> Allen

I believe the mine at Cananea is closed, the smelter there has been gone for many years.

mapboy Wrote:
-------------------------------------------------------

> I did a tour of the Mission Mine two years ago, and IIRC they truck 100 tons a day of concentrate, or one rail carload.  So 30 cars a month.  If things haven't changed, the LKT21 local (Mo Tu Th) could take the loads from Mission Mine to Tucson. The LKT72 Magma Turn (Mo We Fr) could take it to Magma, where the Copper Basin Railway (owned by ASARCO) could take it to Hayden.  That's three crews.

If the cars are mixed in with other freight on the locals, the crew costs are spread across those other customers and commodities. From an accountant's point of view, it doesn't sound like it's so nightmarish.

Railroads like to brainwash everyone into thinking that they're the most cost-effective, efficient mode of transport, and then you hear all these stories where they're turning business away. Maybe UP and CSX would make a good pairing in a merger. They seem to have the same operating philosophy. Let's let Hunter run the show.

Where's the Interstate Commerce Commission when you need it?

CA_Sou_MA_Agent Wrote:
-------------------------------------------------------
> mapboy Wrote:
> --------------------------------------------------
> -----
>
> > I did a tour of the Mission Mine two years ago,
> and IIRC they truck 100 tons a day of concentrate,
> or one rail carload.  So 30 cars a month.  If
> things haven't changed, the LKT21 local (Mo Tu Th)
> could take the loads from Mission Mine to
> Tucson. The LKT72 Magma Turn (Mo We Fr) could
> take it to Magma, where the Copper Basin Railway
> (owned by ASARCO) could take it to Hayden.
>  That's three crews.
>
> If the cars are mixed in with other freight on the
> locals, the crew costs are spread across those
> other customers and commodities. From an
> accountant's point of view, it doesn't sound like
> it's so nightmarish.
>
> Railroads like to brainwash everyone into thinking
> that they're the most cost-effective, efficient
> mode of transport, and then you hear all these
> stories where they're turning business away.
> Maybe UP and CSX would make a good pairing in a
> merger. They seem to have the same operating
> philosophy. Let's let Hunter run the show.
>
> Where's the Interstate Commerce Commission when
> you need it?

Exactly. Seems the Class one railroads are only interested in long hauls and very high profit traffic. Otherwise, they don't think it's worth their "valuable" time to mess with it.

Railroads are indeed a truckers best friend...

CA_Sou_MA_Agent Wrote:
-------------------------------------------------------

> Where's the Interstate Commerce Commission when
> you need it?


Sorry, but the ICC should not be remembered fondly. They were extremely slow granting rate increases to the railroads, in the 1970's, to offset rising diesel fuel and other costs. They took FOREVER to make a decision in the Rock Island case, letting RI wither in the process, thus hurting shippers. Their decision making process was simply mind boggling and hurt the industry as a whole.



Allen

mapboy Wrote:
-------------------------------------------------------
> bradleymckay Wrote:
> --------------------------------------------------
> -----
> > Earlk Wrote:
> >
> --------------------------------------------------
>
> >
> > > Presently the ASARCO smelter in Hayden, AZ
> > > receives concentrate from the Mission
> Mine south
> > > of Tucson by truck because the Class 1
> carrier
> > > that has trackage into the mine won't give
> > > satisfactory service and a competitive rate.
> >
> > What would the estimated number of carloads per
> > month be if it went by rail? It would be a
> short
> > haul so maybe UP doesn't consider it profitable
> > enough to throw locomotives and manpower at it.
> > We know that 2 of the biggest expenses on the
> > railroad are diesel fuel and employees...
> > Allen
>
> I did a tour of the Mission Mine two years ago,
> and IIRC they truck 100 tons a day of concentrate,
> or one rail carload.  So 30 cars a month.  If
> things haven't changed, the LKT21 local (Mo Tu Th)
> could take the loads from Mission Mine to Tucson.
>  The LKT72 Magma Turn (Mo We Fr) could take it to
> Magma, where the Copper Basin Railway (owned by
> ASARCO) could take it to Hayden.  That's three
> crews.
>
> mapboy

There are literally dozens of trucks running daily between the Mission Mine and the ASARCO smelter in Hayden. CBRY/ASARCO has tried to get the UP to take the business, but they simply don't want to, so the jack the rate up to point where trucking is cheaper and give better service. Interesting, is that a few carloads of concentrate showed up from Mission the other day. They are flat bottom gons which will have to be unloaded with a excavator, then loaded back into a concentrate hopper for the trip over to the smelter for unlading again..