Wallula’s Cold Connect shutters its shipping operation | Coronavirus
Walla Walla’s produce train has come to the end of its line.
Union Pacific Railroad, which operates the Cold Connect warehouse and rail line, has closed the Wallula facility that shipped produce and other commodities across the country on a dedicated line to serve East Coast markets.
“On Friday, May 8, we notified employees that Cold Connect, a Loup Logistics service that moves refrigerated products from the West Coast to Union Pacific’s warehouse in Rotterdam, New York, will permanently close and most Cold Connect-related positions have been eliminated,” the company said in an announcement.
The announcement said the COVID-19 pandemic is the reason for the closure.
“This decision was not made lightly. Since acquiring the Railex assets in 2017, employees diligently worked to grow volumes and create a platform for the future; however, with COVID-19 impacting volume and truck prices, it is no longer sustainable to continue operations,” the announcement said.
How many employees are affected was not clear from the announcement.
Port of Walla Walla Executive Director Patrick Reay said this morning the impact goes beyond the facility and employment into the agriculture industry that ships hundreds of millions of pounds of produce on the rail line each year.
He said a meeting with Union Pacific Railroad is scheduled to discuss potential specifics of what happens with the 200,000-square-foot facility.
The operation got its start as a solution to shipping challenges when long-haul trucks were in short supply and access to rail cars was even more challenging. The refrigerated rail cars were a solution to move produce to the East Coast at a similar warehouse in Rotterdam in five days — the same span as trucking but at less cost at the time.
In a massive private/public partnership, the facility was constructed on land that had been owned by the Port of Walla Walla in a $58 million development.
The facility “allowed people to make some choices they didn’t have before,” reflected Jim Kleist, former Railex manager. Kleist was the first employee hired at then-railed and spent a decade at the helm of the warehouse before leaving in 2016 to run Northwest Wine Services, the wine storage warehouse built on property directly behind Cold Connect.
“Sixty-five percent or more of the population lives east of the Mississippi,” Kleist said. “And we grow the greatest food in the Northwest. So now we’re going to get it there.”
Kleist said the added capacity had a different effect on transportation than initially expected. The use of the 55 rail cars eased demand on trucks, resulting in lower shipping prices.
The volley over which model was more advantageous has gone back and forth, but for shippers it has ultimately meant more options.
Railex was purchased by the railroad in 2017, and the warehouse operation was renamed Cold Connect.
During a Port of Walla Walla economic development meeting, Cold Connect management said in 2018 annual shipments totaled about 750 million pounds of produce, with the highest volumes in onions, apples, wine, pears and potatoes.
The facility off Dodd Road at the time had 225,000 square feet of refrigerated space; six computer-controlled temperature zones; 19 enclosed refrigerated rail docks; 38 refrigerated truck docks; fully integrated radio frequency-enabled warehouse management system; and a 2 mile rail loop track on the property.