Advertise in Print | Subscriptions
Published July 18, 2014, 04:25 PM

Ag groups want to limit rail costs with late cars

The North Dakota Farmers Union and North Dakota Corn Growers Association are among 23 organizations nationwide filing comments on rate case complaint procedures with the U.S. Surface Transportation Board. The action is “the largest combined filing by farm organizations in years,” according to the joint news release by the two groups.

By: Mikkel Pates, Agweek

FARGO, N.D. — The North Dakota Farmers Union and North Dakota Corn Growers Association are among 23 organizations nationwide filing comments on rate case complaint procedures with the U.S. Surface Transportation Board. The action is “the largest combined filing by farm organizations in years,” according to the joint news release by the two groups.

NDFU President Mark Watne tells Agweek that while elevators and grain users traditionally filed STB cases, the comments are the first step to establish the right of farmers and ranchers to do the same. He says the case was initiated in Montana because delays in shipping by the Burlington Northern Santa Fe Railway and Canadian Pacific Railroad have been costing farmers 30 to 80 cents a bushel in increased market basis.

If allowed to file a case with the STB, the groups would ask for some mechanism that would prevent railroads from excessive increases in rail rates for grain at a time when service is poor. Watne says elevators will have to pay more of a premium in secondary markets to guarantee car availability. Those premiums are “going through the roof” at $7,000 to $8,000 per car, he says. The extra cost will mean farmers will be paid less for their grain.

Watne says railroads appear not to have the capacity to manage all of the products farmers need to move to market. He says the desired result is to “take some of the priority away from oil and put it back to grain,” but emphasizes the groups don’t want to shut down oil, either.

Producers are concerned about the ability and willingness of BNSF and CP to deliver last year’s crop to market in time for this year’s harvest, says Tom Lilja, executive director of the NDCGA.

“Timely corn deliveries are needed for ethanol production and for feedlots supporting livestock and meat production,” he says. “Thousands of shipments are behind schedule. Harvest and planting can’t wait for railroads to resolve their service problems.”

Farmers Union organizations from Minnesota, Montana, South Dakota and Wisconsin are involved. The National Corn Growers Association, and state organizations from North Dakota, Nebraska and South Dakota, also are involved, as are the Montana Wheat and Barley Committee, the South Dakota Wheat Commission, and the USA Dry Pea and Lentil Council.

Tags: