WASHINGTON, Sept. 4, 2014 – Surface Transportation Board officials held a field hearing Thursday in Fargo, N.D., to address rail service issues that continue to impact North Dakota and surrounding states.
STB officials Debra Miller, Daniel Elliott, and Ann Begeman conducted a field hearing that heard testimony on different aspects of rail issues from nine different panels. Witnesses ranged from regional agricultural stakeholders to representatives from the area’s major railroad companies: Burlington Northern Sante Fe, Canadian Pacific, and Genesse & Wyoming. All three members of North Dakota’s Congressional delegation also spoke at the hearing.
The hearing addressed rail issues so dire that many elevators are still holding all or part of their 2013 crop harvest with 2014’s harvest just around the corner. Agricultural stakeholders are concerned this could negatively affect basis levels and cash grain bids as well as create a storage issue when the new crop harvest begins.
American Soybean Association Director Lance Peterson was on hand to deliver testimony and talked about the trickle-down ramifications that will eventually impact producers.
“(I)nadequate rail service through delays and increased freight costs is not just a business challenge, but creates massive losses which are passed directly on to the agricultural producer—the farmer,” Peterson said in a release. “(W)ith thousands of producers across the upper Midwest losses could be in the hundreds of millions of dollars.”
Peterson – and many others giving testimony – said he was told the issue was supposed to be corrected before the 2014 harvest. Rail companies continue to make progress on backorders, but Peterson said the progress is not fast enough.
“In many cases shippers have spent millions of dollars in premiums on initial rail car auctions to access rail cars for the coming year,” Peterson said during his testimony. “If grain movement is not adequate, shippers will be forced to look to the secondary market to acquire additional cars . . . It is imperative that rail movement is adequate and timely.”
BNSF said it has moved an all-time record amount of grain out of North Dakota this year and currently has less than 1,000 past-due orders in the state after having more than 8,000 in March. Numbers from CP are not as clear; the company says between 200 and 2,000 past-due rail cars.
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