GREAT FALLS, Mont. — Local grain leaders are blasting expanded railroad discounts to farmers in neighboring states, saying the move stings Montana producers who already are victims of price-gouging, the Great Falls Tribune reports.
The move expands discount rates to 52-car grain elevators in western Minnesota and North Dakota. Previously the discounts were offered only to 110-car elevators, which handle larger volumes.
With the new discount, it costs 89 cents-a-bushel to ship grain to Portland from Finley, N.D., compared to 90 cents-a-bushel from Chinook.
“Why is it right for them to ship wheat cheaper 800 miles further away from Portland than we are?” asked Montana Grain Growers Association President Larry Barbie, who farms near Inverness. “That doesn’t make any common sense. The further away you are from your port the rate should go up, not down.”
The MGGA and the Montana Wheat and Barley Association blasted the discounts in a letter sent to the Burlington Northern-Santa Fe Railway CEO Matt Rose this week.
BNSF has said Montana lacks available grain to fill export orders, hence its higher rates.
But Montana grain leaders say Montana has an adequate grain supply.
As of Dec. 1 the state had all-wheat stocks of 108 million bushels, according to the Montana Agricultural Statistics Service.
“That includes 79 million bushels of spring wheat, the primary class of Red River Valley wheat being shipped to Portland with the (discounted) rates,” said Richard Owen, executive vice president of the Montana Grain Growers Association, in a prepared statement. “Had the BNSF been willing to offer Montana producers the same discounts, we are confident that exporters could have secured the grain necessary to fill their orders without going to Minnesota.”
Montana grain leaders say Montana’s lack of railroad competition is the root cause of the price difference. BNSF is the only shipper available to most Montana grain elevators.