Union Pacific Railroad and Rocky Mountain Steel Mills have signed a new seven-year agreement for the domestic production of steel rails. This extends a long-standing commercial relationship and confirms continued demand for US-made rail infrastructure materials.
The arrangement centres on supply from Rocky Mountain Steel’s facility in Pueblo, Colorado, which is the only remaining dedicated steel rail production site in the United States.
Steel for the contract will be produced by members of the United Steelworkers union.
Union Pacific in Arizona
Union Pacific has sourced rail from the Pueblo mill since the early 1890s. The latest agreement follows a period of legal dispute between the two companies, which has now been resolved with the withdrawal of a lawsuit previously filed by Union Pacific in Nebraska.
Rocky Mountain Steel, operating under new ownership, plans to begin operations this year at a newly constructed long-rail mill at the Pueblo site. The project represents an investment of more than 1 billion USD and is intended to expand domestic production capacity.
The facility is expected to produce rail lengths of up to 100 metres, reducing the number of welds required compared with shorter sections and contributing to changes in track installation and maintenance practices.
The new mill will be powered by a dedicated solar installation covering approximately 1,800 acres.
Jim Vena, chief executive of Union Pacific, said:
We appreciate the longstanding relationship with Rocky Mountain Steel, its dedicated workforce and their collective commitment to domestic steel manufacturing. The new long-rail mill is a significant step forward in American manufacturing that supports Union Pacific’s focus on delivering safe, reliable service for our customers.
As Union Pacific pursues its merger with Norfolk Southern to create the nation’s first transcontinental railroad, our ability to partner with Rocky Mountain Steel becomes even more critical as our merger is positioned to strengthen the nation’s manufacturing core as well as domestic job growth.
The agreement is expected to benefit employment at the Pueblo facility and the United Steelworkers members involved in rail production. The site has historically played a role in regional industrial activity and in supplying rail infrastructure across the western United States.
The commercial relationship between Union Pacific and the Pueblo mill spans nearly 140 years and includes periods of increased output during the early 20th century, including during the First World War, when rail transport and steel production were coordinated to support logistics and manufacturing needs.
Doug Matthews, CEO of Orion Steel, the parent company of Rocky Mountain Steel Mills said:
The new contract reinforces the one-of-a-kind partnership between Union Pacific Railroad and Rocky Mountain Steel, a relationship that traces its roots back to the 1890’s and has been benefiting American workers every day since. This mill is an essential part of America’s steel transportation infrastructure, and its continued existence shows that our nation offers railroads large and small the very best product, made by the very best steelmakers in the world. I thank Union Pacific leadership for making that case crystal clear via this new long-term contract.