(The Associated Press circulated the following article by Becky Bohrer on August 1.)
BILLINGS, Mont. — BNSF Railway is lowering the rates it charges for certain wheat shipments from Montana, North Dakota, South Dakota and Minnesota. It’s an effort the company says is aimed at encouraging the use of more efficient shuttle-car systems.
Effective Tuesday, the rate for shipping wheat by shuttle from the four states to the West Coast will be $100 less per car, the company said in a statement. Rates currently differ at the various shuttle stations, but the BNSF change will be a flat, across-the-board reduction, the company said.
Rep. Denny Rehberg, R-Mont., said the decision is good for Montana wheat producers and a positive step by the state’s primary rail shipper.
But Steve Strege, with the North Dakota Grain Dealers Association, said the rate cut, while welcome, seems to indicate the railroad is moving toward a two-tier rate structure. That could hurt elevators that have invested in facilities that accommodate fewer cars, Strege said.
For years, 52-car facilities were considered ideal, he said. “And now they seem to be going onto another size. I don’t want to sound anti-shuttle. I’m pro-everybody being in the market,” Strege said.
“If an elevator is going to go out of business, it should be on its own, and not on account of something like this,” he added.
Gus Melonas, a BNSF spokesman in Seattle, said shuttles, which typically have around 110 cars, are a higher speed and more efficient means of moving grain from the northern tier states to the Pacific Northwest. That efficiency is being reflected in the rate reduction, as a savings to farmers and shippers, he said.
Representatives of two grain growing groups in Montana knew little or nothing of the plan early Tuesday.
Richard Owen, executive vice president of the Montana Grain Growers Association, said the benefit of shuttle facilities, for the railroad, is the ability to schedule more efficient movement of grain. For farmers, the benefit, at least in theory, is lower shipping costs, he said.
A map on BNSF’s Web site shows several dozen shuttle train elevators on the railroad’s system in the four states.