(The following story by Chris Anderson appeared on the Bloomington Pantagraph website on September 2.)
TOLUCA, Ill. — The silver bins towering over a loop of railroad track among cornfields just west of Rutland stand as testament to the latest trend in grain marketing.
Ruff Rail at Toluca, owned by Ruff Bros. Grain, is the fifth grain rail terminal built in the last year along the Burlington Northern Santa Fe Railroad in Central Illinois. Access Ag at Ransom added a loop line terminal last October.
The new rail connections, which can service more economical, 110-car trains, widen access to markets in the West, Texas and Mexico.
“We have shipped all our corn to Peoria processors or to the Illinois River by truck. We may still use those markets, but this opens a new market to us and our customers. We can offer our customers higher bids,” said Jesse Ruff, Ruff Bros. general manager.
Ruff heard a rumor last year that the railroad was looking for grain elevators to add loop tracks. Ruff and Access Ag general manager Sean Garkey discovered the railroad, which controlled grain flow from Chicago to the West, was interested in rail loops linking the railroad to the grain elevators.
The railroad markets include corn-based ethanol fuel plants and Pacific Ocean terminals shipping grain to Asia.
Concentration on those western markets had left the railroad short of Midwest grain elevators capable of shipping corn via rail to Texas and Mexico.
All corn being shipped from the five new elevators in Illinois goes to feed cattle in west Texas or Mexico.
“I had originally contacted the BNSF (railroad) about shipping smaller unit trains to Chicago. They wanted us to upgrade our facilities to move 110-car trains. That ended up the only decision to be made,” said Garkey.
Access Ag, a recent consolidation of Farmers Elevator Co. at Ransom and Mazon Farmers Elevator at Mazon, spent $3 million last fall to upgrade existing facilities in Ransom to load 110-car trains. The elevator shipped its 39th train Aug. 28.
“We already straddled the BNSF, but we couldn’t get a decent freight rate if we only loaded 25 cars. BNSF offered us an incentive to upgrade with higher capacity receiving legs and bulk loadout to the railcars. We get a percentage per bushel shipped the first year. And we get better bids than we get to the Gulf (of Mexico via barge),” said Kent Hamm, Ransom facility manager.
Both Access Ag and Ruff Bros. added 1 1/2 miles of railroad track connecting to an existing railroad line. The loop allows 110 cars and an engine to stay intact while being loaded in a 15-hour period.
Access Ag was the first of the five grain elevators to ship a trainload of corn. Each trainload holds 400,000 bushels to 440,000 bushels of corn — equal to eight river barges. Other new terminals were built at Mendota, Galva and Waverly.
Ruff Rail hopes to receive its first train by mid-September, when the new terminal will be finished. Ruff said the facility cost several million dollars.
The company had to buy land adjoining the railroad as well as install 690,000 bushels of grain storage, rail loading equipment and track.
Work began last fall when a 20-foot-deep truck unloading pit was dug. Corn was loaded into new steel bins in July.
Grain Flo Inc. at Heyworth built the Ruff Rail bin and loading/unloading system, while KDJ Sales & Service of Mackinaw provided electrical service. DOT Rail Services at LaSalle installed the track.
Ruff Bros. Grain has grain storage facilities at Long Point, Spires, Rutland and Woodford.
“Fast loadout allows us to get attractive bids from the railroad. It’s our answer to the lock-and-dam upgrade problem (on the Illinois River). It doesn’t hurt to have the river market, but it’s not as important as it would be without the loop line,” said Ruff, who owns the company with his dad, Jerry, and uncle, Otis. “We hope to buy grain from neighboring elevators as well as our regular customers.”