On a lighter note, I've been having some strange things going on at work that I wish I could attribute to a full moon. Alas, that is not to be; the moon was full about two weeks ago. First, let me give a brief explanation about what I do and where I work.
I work at a steel trading company. We buy steel coils. Think about a roll of toilet paper, and we buy those in steel, about 4-6 feet (1-2 meters) wide. They weigh anywhere from 10,000 lbs to 45,000 lbs each. We have customers located all over the east coast, south and midwest of the U.S., and my department purchases steel from mills located in the midwest, west coast, and east coast of the U.S. My particular story has to do with a steel mill located in West Virginia (in the tiny narrow point that is smushed between Ohio and Pennsylvania) and a customer located in Alabama. There are three ways for us to ship these steel coils from WV to AL. We can load them on trucks, we can put them on railcars, or we can put them on barges and they would go down the Ohio and Tennessee Rivers to a barge terminal in AL where it would be unloaded. As for cost, trucking the material is currently the most expensive method, then rail, then barge. So to save the customer some money due to high steel costs, we agreed to barge several of his orders down there. Now, the other thing you have to understand is that these orders total several hundred thousand pounds.
We had some of the material ready for a barge that left the mill the end of July. On that barge we loaded about 827,000 pounds of steel coils (I'm not even going to TRY to convert for ya Kerry, lmao). While on the Tennessee River, after entering Alabama, the barge has to go through a series of locks. I'm sure this is due to different water levels in that area of the river. Apparently, sometime before our barge was to enter the locks, another barge hit one of the doors to the locks, and jammed it. Because of this, the door couldn't open and close normally, so they had to bring the barges in to the locks one at a time instead of several at once. They may have also wanted to get them fixed. All I really know for sure is that our barge would be delayed by at least another 4-7 days, on top of the approximately 2 weeks it had already been on the water.
Another mill, which had originally contracted for the barge, and who also had material on the barge, needed their material delivered or a customer would be shut down. So, unbeknownst to us, they diverted the barge over to the Yellow Creek Port Authority in Iuka, Mississippi, about 65 miles further away than the original destination. We did not find out about this until after the barge was completely unloaded, not that we would have had any say in the matter, but we could have started discussions about costs with the necessary parties. So now, we've been scrambling to figure out who will pay the extra costs for our customer to truck freight the coils 65 miles instead of 20 miles, plus storage costs since the coils were unloaded without telling us. Storage costs are $.90 per ton for a minimum of 30 days, so for 413.6 tons that $372 or so. Not a lot, but it's extra cost our customer shouldn't have to pay. Then there's the freight costs. That's a difference of about $12.60 per ton, or just over $5000. That's a chunk of change!

Fast-forward to today. I get an email from the same mill that produced the material that was on the barge. They had 40 more coils, totaling about a million pounds, that were supposed to go on another barge down to THE SAME CUSTOMER. Any guesses on what happened? You'll never get it, lol. The mill loads the coils into rail cars to go up to the other mill that contracted the barge (and where they buy the bare coils that they coat), but instead of the coils being unloaded off the rail cars and loaded onto the barge, they continue on their merry way down to Alabama! That million pounds of steel, would have cost about $15,700 total in freight to go down by barge. By rail it's almost double that, $26,000. I'm told that to bring the railcars back to the mill and wait to go on another barge would be difficult, because they don't know for sure if or when the next barge will be going down to Alabama. My first question was, what freight are we being charged? The answer: the barge rate. Whew! So our only solution is to let the rail cars continue on their merry way down to Alabama, we'll alert the customer that he'll be receiving A LOT of railcars in a week or two, but that he's paying the cheaper barge rate, lol.
All this while we're trying to renegotiate the new contract with that customer, lmao.
Ok, I tried posting a picture here at the end of my long-winded tale. I wanted it at the end, not the beginning. Well, I didn't think it worked the first time, so I did it a second time. Then I had two pictures at the top of the same thing. I tried to cut and paste, but it didn't work. So I deleted the two pictures, saved my post, went to help to see what it said about placement of pictures within your text (first vs last...not just centered, left or right). It didn't help, so I figured I'd come back, put the picture in again, and try moving the text around instead. Well I tried that three times, now I can't get the darn picture to post at all, lmao! Ok, while I still had this open, I went and deleted all my cookies and temp internet files, and now the picture shows up! *rolls eyes* Let me try this. I think it worked!
renegotiating a new contract is gonna be fun cause I don't see the prices of steel coming down nor the cost of shipping. 827,000 pounds is a shitload don't need to have that converted LMAO
ReplyDeleteHey at least you got to post pictures!
Fascinating reading this morning. And I thought we had it bad getting feed ingredients in by rail sometimes. They get hung up in the yards in Elmira, New York, for days on end, so we have to scramble and order in a truck load so we can keep making feed. Elmira is only about an hour northwest of us.
ReplyDeleteDang, Kerry....still can't post pics????
Okay, I wondered, I see those coils coming through town quite often, yes, wrapped, and now I'm gonna wonder if you had something to do with them!!! HEHE
ReplyDeleteI don't think I'll watch World Trade Center, I still can't watch anything that has to do with that day, I still cry.