Improvements ahead: Ellis & Eastern Railroad continues investments in infrastructure
March 7, 2023
This paid piece is sponsored by Knife River South Dakota.
A section of rail line that has been inactive for more than 40 years is getting new life.
The Ellis & Eastern Railroad was formed in the mid-1980s, following Sweetman Construction’s purchase of a portion of the Chicago & North Western Railroad.
In 2017, the line expanded with the purchase of the Minnesota Southern Railway, and the short line grew to 65 total miles, from Ellis, South Dakota, to Worthington, Minnesota.
“Ellis & Eastern specializes in meeting the needs of area companies who want to decrease trucking costs on cargo – everything from lumber to scrap metal, farm products and building materials,” said Knife River South Dakota president Clark Meyer.
“In recent years, companies increasingly are seeing the value of rail service or have become more dependent on it as they’ve navigated supply chain issues. That, combined with the overall growth and economic activity in our region, is driving our decision to further invest in the railroad.”
It’s a vital part of operations for Knife River in Sioux Falls, transporting aggregate products internally, while also offering rail transportation services to outside customers.
Rail to Road, a sister company formed in 2012, offers transloading to assist customers not located directly on a rail line, with access to the benefits of rail shipping. It moves raw materials from rail car to truck for delivery to its destination. Dimensional lumber, sheetrock, agriculture products and used oil have been transloaded at various times.
Both the rail service itself and the transloading operation are key to area businesses such as Gage Brothers Concrete Products, which brings in all its white cement on rail, in addition to rebar and steel.
“They’re great to work with,” Gage Brothers president Joe Bunkers said. “They truly are out for what’s best for everyone. In a world where getting trains on time and having rail cars be here when needed, they’re good at helping us navigate that system and doing what they need to do on their side to keep things moving.”
“There are a lot of raw ingredients we use shipped via rail,” Bunkers said. “Being able to have more local control of distribution and service is huge.”
Other businesses, such as cement powder supplier GCC, use Ellis & Eastern for the final switching of their product for distribution to the local market. The recent rail improvements have another immediate advantage: a place to store and stage loaded cement cars to lessen the cement shortage strain when the busy summer construction season is rolling.
“As the supply chain and high fuel prices continue to present challenges, many organizations are moving from ‘just in time’ delivery models to ‘just in case’ models, which is driving the need for additional car storage capacity,” said Dan Kippley, economic and business development representative for Rail to Road and Ellis & Eastern.
“For instance, a ton of freight can be moved 492 miles on a gallon of fuel by rail versus 134 miles by truck. For heavy freight needing to be moved more than 300 miles, it might be advantageous to be served by both rail and a transloader.”
The Ellis & Eastern improvements are scheduled to continue for the next several years. The line west of Sioux Falls will be rehabilitated over the next couple years, and the line east of Brandon to Valley Springs will be rebuilt over the next five years as part of a CRISI grant that Ellis & Eastern was awarded.
The portion of track that the Ellis & Eastern Railroad has been rehabilitating is west of North Le Mesa Drive, just outside of Sioux Falls, ultimately preparing for expanded economic activity west of the city.
“The goal is to have a safe and efficient rail system that our team can operate on and meet the needs of the customers on the west side of Sioux Falls,” said Eric Berning, supervisor of track maintenance for Ellis & Eastern.
In late 2022, Ellis & Eastern replaced a bridge just west of Sioux Falls with large culverts, new ties and ballast. The railroad also has coordinated with the local township to install a new crossing at Madison Street.
“We worked as long as the weather allowed,” Berning said. “In the spring, we’ll continue to replace broken rail, install new ties and add ballast.” The next phase will include continued rehabilitation west to the origination of the line, just west of the town of Ellis. “We don’t anticipate any of these projects to cause any traffic delays to the general public.”
Once complete, service to manufacturing facilities in areas such as Hartford and Lyons will be enhanced, along with potential new warehouse tenants in western Sioux Falls.
“We have a number of key existing customers in this area, and we anticipate demand from others,” said Ryan Hunsaid, Ellis & Eastern trainmaster. “It’s imperative that we have the rail capacity to move rail cars in a timely fashion and keep the construction industry supplied with vital raw materials.”
The rehabilitation between Brandon and Valley Springs will open up access for Ellis & Eastern customers and connect the two portions of operating line.
“These are key infrastructure investments to support our region,” Meyer said. “We’re looking forward to what more we’ll be able to offer in just a few short years.”
