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1/31/2002



Rail News: Rail Industry Trends

BNSF, North Dakota governor to deliberate grain-rate debate


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Most North Dakota grain shippers might be getting the shaft from Burlington Northern Santa Fe’s rates, Gov. John Hoeven believes, according to a prepared statement.
He plans to meet BNSF executives today to discuss the railroad's rate structure, which provides discounts for only a few of the state's largest grain elevators.
"BNSF needs to change its pricing methods in a way that is fair to all of our grain elevators," Hoeven.
The railroad in July introduced a rate structure some shippers believe unfairly favors elevators large enough to load 110-car shuttle trains over smaller, more-rural facilities.
Most of the state's grain elevators, including 190 located along BNSF’s lines, can handle no more than 54 cars, although grain is North Dakota’s largest crop.
In response, North Dakota Grain Dealers Association in fall formed Alliance to Keep Rural America on Track, a coalition that aims to fight BNSF’s rate structure.
BNSF officials believe there’s no evidence that their pricing system is driving North Dakota grain elevators out of business.
"The more efficient of a product the grain shipper uses, the lower the rate, because we share those economics savings with them," said Stevan Bobb, BNSF's group vice president of agricultural products. "It's just like if you buy something in bulk, you probably pay less for it than if you buy one item at a time."
For now, the governor wants to work with the railroad on the issue, said Lance Gaebe, an agricultural policy advisor to Hoeven.
"Our policy isn't to hammer on these guys, but to get this thing resolved," he said.


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