Industry experts unite to move transportation crisis into solution

U.S. Senator Heidi Heitkamp, D-N.D., served as the moderator for a panel that featured Edward Avalos, under-secretary for marketing and regulatory for the U.S. Department of Agriculture and Daniel Elliott, chairperson for the Surface Transportation Board at the U.S. Department of Transportation. The panel discussed how federal agencies have responded and plans to continue to address the transportation situation.

FARGO, N.D. – Crude oil, agriculture and the transportation needed to move it were analyzed and discussed heavily during a conference in Fargo that extended from Monday afternoon into Tuesday morning.

Following a luncheon that featured Kevin Kaufman of Transportation Trade and Marketing Services Group as guest speaker on Monday, the conference continued with industry leaders who deal with large and small scale products.

The multitude of different commodities in the local tri-state area was discussed by farm experts, including Bruce Blanton, director of the Agriculture Transportation Service for the USDA; William Wilson, North Dakota State University distinguished professor of agribusiness and applied economics, Robert Sinner, president of SB&B Food; and Eric Bartsch, general manager of AGT Foods.

“I don’t think there’s one place in the country that has as much diversity as this area,” Sinner said. “There’s a lot of opportunity here.”

The final two panels on Monday covered the implications of agriculture transportation on farm income and was divided into two sessions.

The first half featured Frayne Olson, assistant professor and crops economist at NDSU; and Edward Usset, grain marketing specialist from the Center for Farm Financial Management at the University of Minnesota.

The objectives that need to be sought, according to Olson, include better coordination in transportation and logistics throughout the supply chain and an improved communication between railroads, grain merchandisers and farmers.

“It’s important that farmers keep track of the transportation topic,” Olson said. “Farmers who do not monitor transportation issues and incorporate this information into their marketing plans will be at a disadvantage.

“There will be rewards for helping manage grain flow and transportation issues,” Olson continued. “For farmers, be careful to manage grain sales to meet cash flow demands.”

Usset talked about a survey for grain elevators regarding the rail car shortage. One of the main questions asked was, “How many days past due is your oldest open order for rail cars?”

“Half did not have any past due and the other half was about two weeks out,” Usset said. “Nearly 40 elevators were questioned in the survey. This is a snapshot, however, of how things are here and now. Many of the problems we have dealt with could return.”

In the second session, panelists included Dan De-Rouchey, board member from the North Dakota Grain Dealers Association; and Eric Broten, board member from North Dakota Soybean Growers Association.

During the panel, cost levels and trends were discussed through a Powerpoint presentation by Broten. The information showed how the cost of transportation by ocean freight has gone down 25 percent since 2004 while rail freight has gone up by 24 percent.

The sessions continued Tuesday, covering crude oil, ethanol, coal shipments and improving the transportation system.

The sixth panel included Ron Ness of the North Dakota Petroleum Council; Randall Doval, chief operating officer for AL-Corn Clean Fuel; and Tom Canter, executive director for the National Coal Transportation Association.

The final panel at the conference included Julie Fedorchak, North Dakota public service commissioner; Greg Guthrie, director of customer service for agricultural products at Burlington Northern Santa Fe; Neal Fisher, administrator of North Dakota Wheat Commission; Dane Braun, agricultural strategist at North Dakota Farmers Union; Pete Hanebutt, director of public policy for North Dakota Farm Bureau; and Dan Mack, vice president of rail transportation at CHS.

“My whole reason for wanting to do this was not to do another crisis meeting,” said U.S. Sen. Heidi Heitkamp, D-N.D., who helped organize the conference. “What we’ve done recently has been crisis meetings. This conference was to say ‘yes, we have to deal with the crisis,’ but also ask the question ‘how do we manage flow overall and this transportation situation going forward?’”

“What we’ve tried to accomplish is to get all parties included in this agriculture transportation discussion, including decision makers in the public sector, railroad companies and growers and shippers,” said Dr. Won W. Koo, director of the Center for Agricultural Policy and Trade Studies at NDSU and another organizer of the event.

“We were able to hear what the Senators’ views are, the railroad gave us a presentation on what they are going to do in the future and the growers and shippers discussed what kinds of challenges they face,” Koo said. “Then on Tuesday, the conversation is what we should do to do improve agriculture transportation, hearing from those same key groups.

“It’s gone very well,” Koo continued. “I think we accomplished the goal we set when we were organizing the conference.

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