Farmers seek more rail capacity for grain

  • Article by: TOM MEERSMAN , Star Tribune
  • Updated: April 8, 2014 - 9:30 PM

They’re seeking an executive order to get trains moving for grain and fertilizer shipments.

Farmers in the Dakotas are calling on President Obama to help them get grain trains moving again so that millions of bushels of corn sitting in grain elevators and on farms won’t be wasted, and so that fertilizer supplies can reach needed areas in time for spring planting.

Dennis Jones, a farmer near Aberdeen, S.D., and co-founder of the South Dakota Corn Growers, said that rail equipment has been “hijacked by big oil,” and farmers can’t move their corn to either the Pacific Northwest for export or to closer destinations to feed ethanol plants.

“We need to get ag products back on the track and get fertilizer here, and move the mountains of grain that should have been shipped by now,” Jones said.

He spoke at a news conference near Aberdeen on Tuesday morning with other farmers and co-op managers, and will testify at a public hearing in Washington, D.C., on Thursday before the Surface Transportation Board, which regulates railroads.

Several Minnesota Soybean Growers Association leaders also are expected to testify at that hearing that the substantial changes in rail availability are crippling the region’s vital agriculture exports.

Jones said that Obama could issue an executive order forcing Burlington Northern Santa Fe, the dominant railroad in the region, to reallocate some of its equipment and personnel from the Bakken oil fields in western North Dakota to move grain. Alternatively, the government could ask BNSF to share its tracks with competing railroads, he said.

BNSF spokeswoman Amy McBeth denied that the railroad is favoring crude oil shipments over other shippers like agriculture. The railroad had greater freight volumes for nearly everything during the past year, she said, including consumer products, coal and a surge in grain traffic at the end of 2013 caused by overlapping crop harvests.

That, combined with some of the most severe winter weather in decades, slowed all modes of transportation, she said.

“We recognize the severe impact this has had on both freight customers and passenger service on the Northern Corridor, and we are committed to restoring service levels as quickly as possible,” McBeth said.

Jones said the longer-term solution to help farmers is approval of the proposed Keystone XL pipeline so that most North Dakota oil could be transported by pipeline instead of by rail.

Dan Andresen, CEO of Full Circle Ag in Pierpont, S.D., said the railroad is three months behind in shipping grain. But he said the more immediate crisis will be a shortage of fertilizer that is shipped in hopper cars.

Empty rail cars are parked by the hundreds along railway sidings all across the Dakotas, he said.

“It’s not the cars that are the issue; it’s the locomotives,” Andresen said. “We don’t have locomotives and people to run them because they’re all up in the Bakken, pulling oil [trains].”

Andresen said his co-op operates four grain elevators and seven locations in both Dakotas that distribute fertilizer. The fertilizer plants need to be resupplied two or three times during the planting season, which could begin in a week or two.

“We’re not going to have any fertilizer” after the first supplies are gone, he said, “and that’s as big a crisis as the grain.”

If farmers can’t be certain that enough fertilizer will be available, Andresen said, they’ll switch from corn to soybeans, which require less fertilizer.

“This backlog is the worst it’s been, and I’ve been doing this for 30 years,” Andresen said.

Pat Tracy, a corn grower from the Pierre area, said he knows of ethanol plants that have cut back to 30 percent capacity because they can’t get corn. “Something has to be done quickly to get some of this rail equipment back in agriculture,” he said.

Farmers are not opposed to new oil production in the Bakken, Tracy said, but they don’t want it to come at the expense of farmers and their crops.

“The reality is that everything moves by rail out of South Dakota,” he said. “And if the rail system chokes, everybody chokes.”

Tom Meersman • 612-673-7388

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