A report from the U.S. Department of Agriculture (USDA) says soybean, corn and wheat farmers in the upper Midwestern United States lost $570 million in winter 2013-14 due to transportation delays.
Farmers in Montana, Minnesota, North Dakota and South Dakota lost about 3 percent of their cash crop receipts, the report says.
On a nearly exhausted railway network, there is stiff competition, with fracking and oil industries making it more difficult for farmers to find a spot on the rails. Grain car backlogs, storage issues and rail car premiums affected transportation costs and grain prices.
“It wasn’t necessarily that we didn’t have the rail cars, it’s that we didn’t have the engines to pull them all. So when the engines are all pulling oil tankers, we don’t have them to pull grain trains,” said Charlie Kuskie, an agriculture commodity broker in Nebraska.
After the record 2014 harvest, there also were hang-ups on the rails, and farmers and grain elevators turned to barges and trucks to move their grain.
Since 2013, railway companies have added millions of dollars’ worth of railcars, engines, staff support and infrastructure.
Sen. John Thune, R-S.D., who requested the USDA report, praised the rail companies for making changes, but said improvements should continue.
"While the railroads have made important gains in rail service in recent months, we need to work to ensure that this service continues," Thune said.
USDA: Railway Tie-Ups Cost Farmers $570 Million
USDA rail report confirms grain shipping troubles of 2013-14