(The Associated Press circulated the following article on July 29.)
HELENA, Mont. — Gov. Brian Schweitzer is urging BNSF Railway Co. to repeal higher grain-shipping rates that he says could drive Montana’s 52-car grain elevators out of business.
In a letter to BNSF Chief Executive Officer Matt Rose, Schweitzer said increasing shipping rates for grain elevators serving 52-car trains will bankrupt the elevators, decimate local economies and increase costs for farmers.
BNSF announced the new rates about three weeks ago. They begin taking effect next month.
Most of the state’s three dozen 52-car grain elevators are in north-central Montana.
Richard Owen, executive vice president of the Montana Grain Growers Association, said the move is an attempt by BNSF to route more grain traffic to its new 110-car loading facilities, where the railroad can save more money by loading more cars faster.
“It would be OK if they wanted to do that in a competitive environment,” he said. “But when you have a monopoly, we think the ground rules need to be different.”
Schweitzer planned to follow up Wednesday’s letter with a call Thursday to Rose in Fort Worth, Texas.
BNSF spokesman Gus Melonas said the company would have to review Schweitzer’s letter before responding.
BNSF’s grain-shipping rates for 52-car elevators are a few cents per bushel above the rates charged at 110-car units. The railroad wants to increase the 52-car rates by at least 10 cents a bushel, Schweitzer said.
“This (change) raises the distinct possibility that most 52-car facilities in the state of Montana will be forced out of business over the next few years,” he said in the letter.
North-central Montana communities served by 52-car elevators include Great Falls, Big Sandy, Fort Benton, Carter, Chester, Conrad, Cut Bank, Fairfield, Joplin, Rudyard and Denton-Geraldine. Many are on branch lines that hook into main rail lines.
If those elevators are shut down, Schweitzer said, farmers across the region will be forced to truck thousands of bushels of grain to the larger facilities, increasing their costs and causing more damage to roadways.
Schweitzer and Owen said BNSF should maintain the current rates. They also said BNSF should back off from its decision not to quote rates for elevators that haven’t shipped grain in two years.
Rep. John Witt, R-Carter, called the rate increase “atrocious” and said it will deal a major blow to farmers in his area of Chouteau County.
“It’s just a monopoly doing whatever they wish,” said Witt, who farms grain in the Carter and Fort Benton-Loma areas. “The elevator is not going to pay (the increase). It’s going to come off the bottom end. It’s going to come off the farm community.”