Keystone Transportation expands at inland port

A U.S. Department of Agriculture inspector checks a group of logs before they are loaded into containers at the Virginia Inland Port in Front Royal and then exported. Rich Cooley/Daily

FRONT ROYAL – Pennsylvania-based Keystone Transport Solutions will be taking advantage of a new lumber processing facility at the Virginia Inland Port in Front Royal starting this month.

Site manager Aaron Engle said they began transferring equipment in early September to the new site, which is on a hill located away from the port’s main office and shipping yard off of Route 522.

“We’re actually not yet completed, we’re in the process of it,” Engle said.

The company took control of the log exports at the port last October, and has leased 5 acres on-site to expand its capacity with a new log processing gateway facility.

Engle said the new site will allow Keystone to have an easier and smoother flow when it comes to importing and exporting logging products.

Aaron Engle, yard supervisor for Keystone Transportation Solutions, stands beside a group of cherry and ash logs at the Virginia Inland Port in Front Royal on Thursday. Keystone recently moved its logging operation to an isolated area of the inland port. It is now fumigating logs using a plastic housing ,shown in the background, to eliminate any insects before being exported from the port. Rich Cooley/Daily

Keystone Chief Executive Office David Steffens said that, prior to Keystone’s arrival at the inland port, the port was moving around 50 containers of logs per month.

Steffens noted that Keystone was able to increase exports of containerized logs by 50 percent over the last 10 months of 2014. He said that the 5-acre expansion has the capacity to move 400-500 containers each month.

“In the fourth quarter of 2015, we anticipate more containers from the (inland port) by ourselves than all of the companies who are exporting containers in all of 2014,” Steffens said.

The new 5-acre log-processing site will also allow Keystone to fumigate – or treat – between 20 and 24 containers of logs on a concrete pad for invasive pests or insects such as the emerald ash borer on-site.

An inspector from the USDA has to check the logs on a daily basis before anything is shipped to China or other locations within the United States.

A knuckleboom loader lifts a log to load into a container at the Virginia Inland Port in Front Royal on Thursday. Rich Cooley/Daily

Luann Woodard, human resources executive for Keystone, said, “Previous to this, all of our containers were shipped down to Suffolk, and then they fumigated and pushed the gas right into the container.”

Angela Nosca, who does accounting for Keystone, estimated that this lengthy process probably cost the company an extra $80o to $1,200 per container.

Daniel LeGrande, director of inland terminals and sales support, said that Keystone’s plans will allow the port to use more shipping containers, which would otherwise be empty, for agricultural goods like logs.

“The facility is heavy on the import side, so we’re bringing in more containers than we’re sending out full,” LeGrande said. “A lot of those containers have to be taken back to Norfolk empty.”

LeGrande added, “(Keystone) is able to use empty containers to put their logs in and, in a sense, that’s going all the way back to Asia.”

The hope, LeGrande said, is to lower the cost of shipping through using fewer  containers for more goods – as well as sparing company employees the effort of simply “moving air” with an empty container.

“In a perfect world, you want to trade balance. You want the container to always have something in it, but that’s not always possible,” LeGrande said.

The company not only ships its own logging products, but Woodard said they also ship many more logs from around 20-30 third party companies ranging from Pennsylvania, Maryland and Virginia.

Steffens estimated that 70 percent of the logs that Keystone moves come from operations in Virginia – and largely from companies within a 60-mile oval-shaped radius of the Front Royal facility.

“We suspect that we’re probably the top-three exporters of hardwood logs in the United States,” Steffens said. “I’d say that we’re having a dramatic impact on the agenda.”

Keystone is also looking at expanding into other areas of agriculture and forestry.

Woodard said that logging traffic tends to die down during the months of June, July and August. To maintain an income flow, Woodard said they are looking into commodities such as soybean and grains.

“I’ve already had one (local) farmer speak to me about it,” Woodard said. “The market’s too saturated locally, and they want to start moving stuff … or even keep it interstate, get it containerized on this railhead.”

Engle said they are looking to ship the first containers from Keystone’s new facility by Monday.

Contact staff writer Kevin Green at 540-465-5137 ext. 155, or kgreen@nvdaily.com