Montana AG: BNSF overcharges wheat farmers

Chris Rizo Feb. 27, 2009, 2:00pm

Steve Bullock (D)

HELENA, Mont. (Legal Newsline)-Wheat farmers in Montana are being price gouged to ship grain by rail, the state attorney general's office said in a report.

Burlington Northern Santa Fe Railways, which controls 95 percent of rail freight transportation in the state, is taking advantage of farmers in the Treasure State, said Attorney General Steve Bullock.

The Democratic attorney general said the lack of competition among rail lines makes Montana shippers the most captive in the country.

The attorney general's report said that Montana shippers paid $3,454 per carload compared to $2,623 for Kansas, $2,842 for Nebraska, and $3,336 for North Dakota.

Analysts said the total overcharge by BNSF of Montana wheat shipments is estimated between $19 and $50 million annually.

The report also said that in 2006, the year studied in report, the cost of shipping wheat from Montana the Pacific Northwest was 253 percent of BNSF's variable costs.

"BNSF charges Montana shippers more than twice as much as the long-term variable costs of the rail service they receive," the report said.

"This report clearly documents what Montana farmers and ranchers already know from hard experience-they are being charged excessive rates for substandard service. Shippers need competition and they need a fair rate to move their goods to the marketplace," Bullock said. "My office is going to explore every option we have to make sure that Montana's number one industry, family farm agriculture, is given a fair shake."

Bullock said he is working with the attorneys general of South Dakota and Ohio to encourage Congress to pass the Railroad Antitrust Enforcement Act, which would subject railroads to antitrust laws that apply to other industries.

From Legal Newsline: Reach staff reporter Chris Rizo at

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