Global Gateway

By Rena A. Koontz –

Archer Daniels Midland’s new intermodal container facility, a multi-million dollar endeavor that elevates Decatur to a national ranking among global distribution centers, started out small.

But then the ADM team thought outside the box — the shipping container box, that is.

Mark Schweitzer, ADM’s managing director of intermodal and international freight, says the company was looking at ways to better serve its customers, with the goal of getting a shipment to “any customer, anytime, anywhere.” And then, someone at the table asked why it was only ADM’s customers who should benefit from the company’s transportation and logistics expertise. Why not third-party suppliers and their customers?

Fifteen months later in June 2013, ADM opened its intermodal yard on 250-acres of land on East Parkway Drive. The Midwest Inland Port is now a key interchange for three railroads, four interstate highways, and a major U.S. highway, opening a gateway for national and even global imports and exports.

“Intermodal is simply a term for two or more modes of transportation,” Schweitzer explains. “For instance, you have a forty-foot container of iPads coming into North America on an ocean-going vessel. That container is lifted off by crane onto a rail car and delivered to a point where the contents are then off-loaded onto trucks and delivered to various store warehouses. Multi-modal is the most efficient means to move goods around North America.”

In the past, the problem was that the shipping container hauling the iPads could sit empty for sixty to ninety days waiting for another shipment, costing that company money. The benefit to coming through Decatur and ADM’s intermodal hub is that the turnaround for that container can be cut to a week as ADM coordinates another shipment.

“That’s not a whole new look for us,” Schweitzer says. “We’ve always moved large commodities of food, feed, and fuel. What we’re finding is that we can execute third-party freight shipments at a cost savings to other customers; customers that weren’t ADM’s.”

The commodities are endless. Schweitzer ticks off a few — jeans, coats, turkey fryers, fasteners, roofing nails, equipment parts. The intermodal containers can be loaded with virtually any type of product and transported by truck, railcar, or ship. Destinations extend far beyond central Illinois and delivery times are faster. Merchandise can land on the east coast in three days; on the west coast in six. From there, onto a ship and across the ocean.

Ty Hildum, national account manager for Norfolk Southern Corporation, also sees many potential benefits linked to the intermodal facility — both for the railroad and the community. “Since the goal is to ship loaded inbound containers to Decatur via rail for local distribution, as well as increase the amount of containers shipped with ADM and other’s commodities via rail, Norfolk Southern will benefit from increased volumes,” says Hildum.

“Utilizing Decatur as an alternate distribution center to Chicago will also help decrease congestion in Chicago, and increase transportation and warehousing jobs in Central Illinois, “ he adds. “It would reduce the amount of truck miles required to distribute many of the commodities that end up utilizing this transportation network. Why truck product from Chicago distribution centers when you can continue the rail portion of the trip to Decatur?

“If Decatur captures just a small percentage of the Chicago volume, this project will be hugely successful.”

Last year, Decatur was ranked third in the nation as an emerging logistics and distribution center by Business Facilities magazine. Global Trade Magazine ranked Decatur in the top twenty-five global trade cities prior to the opening of the intermodal facility.

Like Hildum, Larry Altenbaumer, interim president of the Economic Development Corporation of Decatur & Macon County, believes the city has only scratched the surface of the facility’s potential.

“I draw a parallel to the technology field, which is changing everyday in what it allows you do. The inland port is the same in terms of its potential. Over the next five years, I think we’ll see a level of economic growth that surpasses what we’ve seen over the last forty years.”

Once Decatur is declared a U.S. Customs port of entry for international cargo and freight, which is in the works, an international shipper that would be held up seaside getting its product through customs will simply be able to continue moving the contents to Decatur, clear customs here, and keep going.

“A company can import or export from Decatur. The inland port can get anything to any customer anywhere in the world,” Altenbaumer says.

There are other intermodal facilities in the country, most owned by the railroads. ADM’s privately-owned facility offers a more cost effective, expeditious alternative. “For all customers, the location provides proximity to 95 million customers within a day’s drive,” a press release states. “The facility itself has two high-capacity cranes that can handle 50,000 containers per year, with room to grow to 150,000.”

Schweitzer says the ramp has created new job opportunities. As volume increases through the complex, the real opportunity will come from all of the jobs associated to the ramp, such as warehousing, trucking, and third-party logistics. Also, the facility has plans in place to operate 24/7 should demand warrant it.

Among ADM’s customers is shipping magnet The A.P. Moller – Maersk Group. Maersk Line is the world’s largest container shipping company and a customer-focused leader in reliable, eco-efficient transport worldwide, according to Fernando Quinonez, director of sales and ADM customer expert. The company is headquartered in Copenhagen, Denmark, with its U.S. head office in Madison, N.J.

Quinonez says Maersk recognizes the inland port’s potential. “I believe the facility creates new opportunities for Central and Southern Illinois. It is great to see ADM take the initiative. They have a great team in place and we see this as a great example of collaboration across multiple vendors/suppliers.

“As it applies to us, we are proud to have worked with ADM for quite a few years and continue to provide them with international containerized transportation of their goods headed overseas,” Quinonez adds. “Our business is capital intensive, and requires us to find efficiencies wherever possible. Removing empty miles is critical to this, and the new ADM facility allows us to optimize the use of our container fleet in the area.”

Since opening, Schweitzer says word of mouth has brought customers to ADM’s door. “For about the last year, we’ve focused on exports. Now, we’re looking at importers and it is snow balling. We’re finding we can create solutions for other customers right here in the state who we never knew existed.”

The multi-modal hub has the potential to turn Decatur into one of the country’s largest exporters. “Right now, we are only limited by our imagination,” Altenbaumer says. “As this picks up traction, the possibilities will be endless.”

 

Rena Koontz is a regular contributor to Decatur Magazine.

 

This is an online supplement to an article which originally appeared in the April / May 2014 issue of Decatur Magazine. It may not be reproduced or redistributed in whole or in part without the publisher’s consent.
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