The Surface Transportation Board (STB) heard about how agricultural and biofuels producers are being impacted by rail service challenges during a two-day hearing this week.
USDA Deputy Secretary Dr. Jewel Bronaugh told the board how rail disruptions are impacting farmers, ranchers and consumers. “Elevators are full and therefore cannot purchase more grain from farmers, and livestock operations are unable to receive the grain they need for feed,” said Bronaugh. “At the same time, ethanol and biodiesel facilities report numerous slowdowns and even shutdowns due to delays in their outbound train service—delays which permeate through the entire supply chain from farmers selling grain to customers buying fuel.”
STB hearing-USDA Deputy Bronaugh (7:37)
National Grain and Feed Association (NGFA) President and CEO Mike Seyfert testified before the board, listing several examples of rail service failures experienced by grain shippers across the country and outlining recommended actions for the STB.
“Almost every shipment made by an NGFA member via rail will be used for either human food, animal food or fuel production,” said Seyfert. “Grain and oilseeds processors, such as flour mills, crushing and biofuels facilities have experienced rail challenges on the inbound and outbound.”
STB hearing-NGFA CEO Seyfert (4:23)
Growth Energy Senior Vice President of Regulatory Affairs Chris Bliley testified on how disruptions have impacted the biofuels industry, including extreme delays in unit traffic and getting loaded trains offsite. “Nearly 70 percent of all ethanol is shipped by rail with 377,000 carloads in 2018 alone,” said Bliley. “Rail service is vital to get ethanol from our biorefineries in the Midwest to American consumers from coast to coast. It is perhaps even more important today with drivers facing high gasoline prices and ethanol continuing to trade 80 cents to a dollar less per gallon than wholesale gasoline.”
STB hearing-Chris Bliley, Growth Energy (3:22)