NOTE: Peoria Area Rail Users are posted alphabetically by railroad station
Now-defunct Central Illinois Railroad Co. engine switches cars for O’Brien Steel on January 26, 2008.
O’Brien Steel Service Co was founded at East Peoria in 1975, moved to Peoria in 1978 after acquiring the shuttered Hyster Co plant and expanded again when it acquired the adjacent Little Giant Products plant in 1983. The company probably first became a rail user in late 1986 or in 1987.
The steel warehouse and processor once had to unload steel beams and load scrap metal on the Kellar Branch itself, a function enabled by a mobile gantry crane. Cars were quickly unloaded/loaded as soon as they arrived (or the following morning as P&PU often ran the Kellar Branch late at night).
In 1995, a dedicated spur was built as part of an expansion and modernization of the company’s steel storage yard. This spur could fit four cars at a time. This would be a key fact in a dispute over demurrage costs with Pioneer Industrial Railway, which took over operation of the city-owned Kellar Branch in February 1998. More on that later.
The practice of foreign steelmakers to dump products on the U. S. market in the late 1990s and early 2000s, significantly reduced O’Brien’s rail volume. In 1993, the company received probably 200+ carloads, but this figure dropped to less than 100 the first full year of PIRY’s operation. it got even worse in 1999 when there about 30 carloads. Foreign steel arrived the area by barge (Peoria Barge Terminal) and then by truck on the last leg.
Controversial steel tariffs enacted in 2001 seems to have shifted O’Brien’s steel buying back to domestic suppliers. But the numbers just didn’t compare to those in the 1990s. Yet expansion would soon create some new business. In 2002, O’Brien Steel built a steel plate processing building.
It was around this time that O’Brien Steel and Pioneer fought over demurrage costs. O’Brien stored material on their spur track, leaving room for just one car at a time. Not a good situation when seven loads – all railroad-owned cars subject to demurrage if they’re not emptied and released after a specified number of days. But that is what happened. PIRY’s crew could spot one car, but the other six started collecting demurrage.
This situation had future ramifications. Central Illinois Railroad Co (CIRY) took over from Pioneer in August 2005, but after a long fight before the Surface Transportation Board, Pioneer regained its operating rights in late 2007. Both carriers operated on the Kellar Branch for a time before CIRY was forced to liquidate. With Pioneer now the only carrier contracted to provide service on the remaining two segments of the city-owned railroad, O’Brien has made other arrangements for steel receipt and scrap shipments.
One wonders why O’Brien doesn’t offer to buy the mile or so of track from Abingdon Street to the Tazewell & Peoria RR and contract with that carrier to provide service. It may or may not be that simple, but it’s an idea worth exploring. Until then, I doubt O’Brien will use rail service. Which is sad.
- David P. Jordan