US Wheat Basis

[Hopalong]

US Wheat Associates has a report in their Aug 7 newsletter.
Shuttle train rates from northern plains elevators to port position have risen to a dollar a bushel above published rates.
The newsletter says it is the same reason as in Canada, harsh winter, large crop and competition from increased oil for available capacity.
It does note that our Canadian situation is even worse with a more regulated system.
Time for our grower organizations to look ahead again at increased incentive for greater transport capacity.
New and increased penalties will only add to a more regulated system.

[farmaholic]

What happens when the number or size of the carrots are never big enough? Then do you use the stick? Rail service is a non competitive captive situation for us. Keep rewarding the offender until primary production doesnt pay, who do I pass my extra freight costs on to?

Terminal deductions are currently about 25% of the value of the grain already...... how much more do you want to "give" up?

[SASKFARMER3]

The great railway project 2015 to 2020. Cp and cN create dual track east and west main line .
No stopping train a drives to Vancouver train b comes back . Rather simple oh wait they like the system now no competition shit service and a captive audience.

[AgrivilleAdmin]

Here is the US Wheat Associates article.

[URL="http://www.farms.com/ExpertsCommentary/record-rail-freight-costs-behind-increasing-basis-levels-80196.aspx"][/URL]

[Hopperbin]

4 dozen service complaints in one month.Among others to raise concern are producers of coal, fertilizer, ethanol and steel - even passenger train operator Amtrak. Their complaints aren't focused solely on BNSF. CP and Union Pacific have been subject to criticism as well.But BNSF owns some key routes. On Amtrak's Empire Builder line from Chicago to Seattle, which traverses the Bakken region on BNSF track, on-time performance has dropped to 27 percent so far this year, down from 76 percent in 2009."We've had very frank conversations with BNSF about their performance," said Amtrak spokesman Marc Magliari. "The've been candid there are issues out there, and they are hiring more crews and locomotives."Power utility trade group, the Western Coal Traffic League, told the U.S. rail regulator last month that BNSF was offering "declining service metrics," adding that "members fear they will run out of coal, if not now, by summer."Nucor Corp, the largest U.S. steel manufacturer, wrote that during the first quarter rail journeys that usually take two weeks required up to two months. The delays "severely affected" profits, it told the regulator."We are not seeing improvement now that the weather has improved," the company wrote.WARNING ON INTERVENTIONThe STB has authority to make railroads prioritize shipping of certain goods during bottlenecks, and some customers are calling on the regulator to act. Last month it granted one such request, ordering BNSF and CP railroads to report their schedules for speedier delivery of fertilizer ahead of the spring planting season, which they did.STB spokesman Dennis Watson declined comment on whether further regulatory action is planned.BNSF has bristled at the possibility of further government intervention, telling the regulator in a letter last week that "the extreme step of directing recovery measures to the benefit of a particular commodity group or geographic locale" would hurt overall network speed and other customers.However, it has acknowledged customer concerns and pledged to address them promptly. "The message that we have fallen short on executing from a service perspective was also very clear," BNSF executive vice president Stevan Bobb wrote in the letter.Again, shippers of staple commodities are concerned railroads are neglecting their cargoes in favor of $100 a barrel oil."We're all paying the price for the railroads' infatuation with moving crude oil," said Bob Dineen, head of the Renewable Fuels Association. "Oil companies aren't complaining. They think the service has been fine." (Reporting by Joshua Schneyer, Editing by Jonathan Leff, Bernard Orr)

[cottonpicken]

Off topic but does anyone else think how counter-intuitive it is that the baltic dry has collapsed but rails cant keep up,i guess its easy to explain,but its still weird.

[ColevilleH2S]

If you grow grains on the plains, and don't think it is a good idea to build more pipeline capacity, you could be an idiot.

Oil over rail is growing exponentially, last years shipping issues were a wake-up call. Very soon a piss poor sized crop will be too much for the system to handle.

The railways are not going to add more track, because oil by rail (might be/hopefully be) a short term flash in the pan. So the only sensible option is to put the oil in a pipe, sooner rather than later. As a grain grower I want it, the oil producers want it, the provicial and federal governments want it. Wtf, getter done!

[vvalk]

Hopalong. The wheat growers put a position forward months ago about an incentive based rail system during surge months. No one was interested

[Oliver88]

Coleville- you summarized the reality in Western Canada quite well.

[Hopalong]

vvalk, can recall railways being asked two or three years ago if they would consider adding surge capacity.
The response was an emphatic no, did not even get to what it would take in higher rates.
Believe RRs still resent revenue cap for grain and special status it receives compared with other freight.
Farmers are still protective of regulated rates and often do not consider how much a regulated system costs us by discouraging investment.
It was the same with CWB and regulated marketing.

[bucket]

Ocean rates came down because a bunch of new ships came on stream. The Baltic dry index indicated that capacity was required.

The railways don't want that to happen to them. Too bad.

Surge capacity can be handled by a third party much the way it is in the states. With the right logistics those cars could float around north America as required.