Atty General Tangles With BNSF Over Grain Rates

By Beacon Staff

HELENA – Montana’s attorney general released a report Thursday highly critical of BNSF Railway and the rates it charges Montana farmers.

Attorney General Steve Bullock said a Department of Justice report shows Montana farmers are paying more than farmers in other states to ship grain.

BNSF responded sharply, saying the report is distorting figures and making incorrect comparisons. The rail company says it has made tremendous strides in recent years to improve its relationship with Montana farmers.

“We are not real happy with the apparent, obvious, disregard for the facts and the misuse of those facts,” said Kevin Kaufman, a company vice president. “The fact is Montana’s rates are no higher … than any other origin in our network.”

For instance, the DOJ report said Montana shippers paid $3,454 per carload compared to $2,623 for Kansas, $2,842 for Nebraska, and $3,336 for North Dakota.

But BNSF said that doesn’t accurately take into account such factors as the distance traveled, destination, type of product and volume shipped.

“You have to look at it on the basis of where is this grain going, how much is going there and compare it to like markets,” Kaufman said.

But Gov. Brian Schweitzer, in a release, said the report shows lack of competition has caused excessive rates.

“The lack of rail competition has caused both excessive freight rates and poor service,” Schweitzer said. “Our farmers, ranchers and other rail shippers deserve better.”

Bullock said he is leading efforts with other states to impose antitrust laws on railroads.

“This report clearly documents what Montana farmers and ranchers already know from hard experience — they are being charged excessive rates for substandard service,” the attorney general said. “Shippers need competition and they need a fair rate to move their goods to the marketplace.”

BNSF and Montana grain groups announced last year a new deal that allows mediation over grain rates. The Fort Worth, Texas-based company pointed to that effort as an example of improvements it has made in serving Montana.