(The following editorial appeared on the Great Falls Tribune website on August 9.)
GREAT FALLS, Mont. — The Montana farm community is getting hammered again.
And the Golden Triangle of Northcentral Montana is taking the hardest blows.
Burlington Northern Santa Fe Railway is implementing a new rate structure this month that will further squeeze struggling farmers and potentially bankrupt a number of area grain elevators.
Sorry, says BNSF, that’s the price of progress.
BNSF is raising its rates on shipping from 52-car grain elevators to drive more business to the bigger 110-car loading facilities.
There are some three dozen 52-car elevators in the state; most are in the Golden Triangle.
Among the towns that probably will be affected are Great Falls, Big Sandy, Fort Benton, Carter, Chester, Conrad, Cut Bank, Fairfield, Joplin, Rudyard and Denton-Geraldine.
BNSF originally planned to charge 15 cents more per bushel to ship from the older terminals.
That prompted a wave of protest from farmers who said it will force them to drive farther distances to the 110-car terminals. That increases their transportation costs and puts a tremendous burden on local roads and highways. And it leaves the smaller elevators without business.
Gov. Brian Schweitzer wrote a strongly worded letter to BNSF and even met with company executives.
The company relented — a bit — and dropped the difference to 14 cents.
Most farmers understand that for BNSF this is simply a business decision. There’s an economy of scale that comes with the larger terminals, and that means greater savings.
That would be easier to accept if Montana shippers weren’t getting hit so much harder than their counterparts in the Midwest.
While Midwest farmers ship their grain farther than Montanans do, BNSF charges them less. That’s right, less.
That’s because elsewhere, other railroads compete against BNSF. Some Midwest shippers even rely on lower Missouri River barges for competition — at the expense of Montana water users, of course.
BNSF holds a monopoly in Montana. Farmers are stuck paying more.
The alternative to high shipping costs is adding value to the grain. That means promoting such enterprises as pasta and malting plants, ethanol, milling, bakeries — anything that puts the grain to use closer to home.
At best, though, that’s a limited alternative. Most Montana grain will continue to leave the state.
Meanwhile, there’s lots of good news if you own BNSF stock.
The company recently announced that its freight revenue is up 47 percent from a year ago. To celebrate, it raised its dividends 18 percent. And the stock price is climbing.
A Morgan Stanley Wall Street analyst calls the company’s performance “very impressive.”
That’s great for investors, but back in Montana many small farm communities are struggling to survive.
BNSF’s rate change will hit them hard.