Captive shippers: Farm Bill orders USDA to study rail rates

One of the transportation issues we hear most about from farm groups, co-ops, businesses and speakers at Congressman Walz's economic summits are captive shipping rates supposedly charged by railroads. Having only one practical method of transport--and only one company doing business supplying that transport--are thought to raise the cost of doing business. 

Is it a legitimate complaint? While we tend to agree with the co-ops and other businesses, their evidence is largely anecdotal.  The question is a long-standing flashpoint in rural politics, going back to the time of the Grange's founding.

Congressman Walz was able to get a provision in the Farm Bill to come up with better information.  Progressive Rail Roading reports that a Provision in Congress-approved 'Farm Bill' would direct USDA to study rail service and rates. The article notes:

The bill also includes a provision authored by Rep. Tim Walz (D-Minn.) that would direct the U.S. Department of Agriculture to study railroads' service, reliability and rates associated with coal, fertilizer, agricultural products and renewable fuels.
 
The department would "study the impact of rail service on rural America and report to Congress on whether additional competition is needed in the rail industry to protect our grain elevators and other agricultural shippers from abusive rail rates," said Walz in a prepared statement.
 
Consumers United for Rail Equity (CURE), which backs Congressional efforts to "bring accountability and fairness" to the rail industry, supports the study, said Executive Director Bob Szabo.
 
"Rail customers have believed for years that railroad monopoly power is adversely affecting rural America in a variety of ways, from slowing economic growth to overcharging for millions of tons of products shipped each year in the U.S., and we are pleased that a Congressionally authorized study will now shed some light on this situation," he said.

In his regularly scheduled Thursday press call. Congressman Walz said that he would eagerly look forward to the results of the study, since sound transportation policy depends on sound research.

As a side note, one of the founders of the Grange learned about the difficulties of farming as a homesteader in Minnesota. Run by the Minnesota Historical Society, the Oliver H. Kelley Farm, near Elk River, serves as a living reminder of the state's agricultural past.

The farm is now open only on weekends, but the hours expand to six days a week in the summer between  Memorial Day and Labor Day. Located in Minnesota's Sixth congressional district, the farm is closed on Mondays in the summer. As readers can see from the picture, this old heifer has occasionally helped with the haying.

Photo top: Railroad tracks at Easton, Minnesota.