The Commission sent a letter this week to the U.S. Surface Transportation Board (STB) outlining the very serious situation for producers who rely on rail to transport their crops to market. The letter states: “We urge you to take immediate action, similar to your work this spring on fertilizer shipments, and require the railroads to devote more resources to transporting the 2013 and 2014 crop to market this fall so the quality of these commodities is preserved and our producers and elevators don’t suffer significant financial harm.”
“The railroad’s response has been entirely inadequate to address the needs of our producers. This year’s crops are ripening, farmers are preparing for harvest, and far too many storage facilities are full or near capacity,” Commissioner Julie Fedorchak, who now holds the rail portfolio, said. “The conditions are ripe for a significant problem with the 2014 crop. This demands swift action by the STB.”
In mid-July, a survey conducted by the PSC of North Dakota grain elevators showed little progress toward reducing overdue grain cars and moving product to market. More than 90 percent of the Canadian Pacific (CP) customers and 50 percent of the Burlington Northern Santa Fe (BNSF) customers who responded were waiting for more than 60 percent of their cars. The survey also asked how customers were feeling looking forward to the 2014 harvest season and the vast majority of the shippers who use both Burlington Northern and Canadian Pacific either have low or no confidence in the service they are going to get.
At a PSC meeting held April 28, railroad officials outlined plans for catching up with demand by late July but reports being filed weekly with the STB continue to show significant backlogs in grain shipments. The July 25 report shows that BNSF had 2,259 overdue cars. Canadian Pacific’s tracking mechanism makes it almost impossible to identify the real number of overdue cars, but the report does show that customers were waiting an average of 11 weeks for cars.
“Inadequate rail service has caused severe financial losses for our producers and elevators on the 2013 crop. Furthermore, inadequate service is already devastating the 2014 cycle because elevators are unable to contract as they normally would if they could count on timely shipping,” Commissioner Randy Christmann said. “This is not only a problem for North Dakota because when the grain is dumped on the ground while waiting for transportation, the food supply loses quality and goes up in price. Thus, this is a problem for the whole country.”