Fire Blocks Union Pacific Route

Union Pacific Corp. said Wednesday that an Oregon tunnel fire that has been burning for days is forcing the railroad to shut down a portion of its main West Coast route for as long as 10 more days, adding to shipment delays that have reduced profit.

The tracks between Eugene, Ore., and Northern California, a primary route for lumber shipments, may not reopen until Aug. 29, the railroad said. The fire began Saturday about 75 miles south of Eugene and is still burning, spokesman John Bromley said. Sparks from a locomotive may have ignited wood in the tunnel.

“This couldn’t come at a worse time or at a worse place, given that we are in peak shipping season and the Pacific Northwest has been one of their trouble spots,” said James Valentine, a Morgan Stanley analyst in Chicago.

Union Pacific told customers last week that it was seeing some progress in ending the railroad’s woes over shipping delays. Unexpected shipping congestion began late last year, with the delays hitting Southern California particularly hard.

The Omaha-based company said the congestion contributed to a 55% drop in first-half net income.

Union Pacific has been turning away some business, hiring workers and adding locomotives to reduce delays.

Union Pacific shares rose 51 cents to $56.22 on the New York Stock Exchange.