Port of StocktonSailors SocietyCleveland Cascades LtdViganTOC EventsTelestack
  • Cleveland Cascades Ltd
  • Bühler GmbH
  • Van Aalst
  • Telestack
  • Multimodal 2022
  • Cimbria

NGFA testifies on rail service failures experienced by grain shippers

NGFA testifies on rail service failures experienced by grain shippers

(Posted on 27/04/22)

The National Grain and Feed Association (NGFA) in the USA has testified before the Surface Transportation Board (STB), listing several examples of rail service failures experienced by grain shippers across the country and outlining recommended actions for the STB.

“NGFA’s preference is to seek commercial solutions between individual rail customers and their rail carriers,” said NGFA President and CEO Mike Seyfert during his oral testimony at STB headquarters. “However, the recent rail service challenges impacting entire regions of the country have led us to the Board to seek help.”

STB Chairman Martin Oberman called for the “Urgent Issues in Freight Rail Service” hearing and directed several Class I carriers to testify on April 26-27. NGFA urged the Board to address inadequate rail service in a March 24 letter to Chairman Oberman and led another letter signed by members of the Agricultural Transportation Working Group on April 21 outlining several proposals to improve rail service.

In testimony, Seyfert listed several instances of rail service failures and their consequences, including excessive dwell time at origin and delayed train delivery at grain export destinations.

“Many NGFA members have a daily risk of slowing or shutting down operations due to reduced and inconsistent rail service,” he said. “Some individual NGFA member companies report losses and increased costs in the tens of millions of dollars and lost or reduced operating days totaling weeks.”

NGFA estimates the combined costs to the grain industry due to lost revenues and additional freight expenses in the first quarter of 2022 to be over $100 million. “Depending on the market position of the grain industry participant, these extra transportation costs are either borne by the participant, reflected in the grain basis paid to the farmer, or passed onto the consumer,” Seyfert noted.

One of NGFA’s recommendations for STB is to implement financial incentives for railroads to perform more efficiently using the same concepts they use to incentivize their customers.

While NGFA member companies understand the pandemic caused labor shortages for employers in many industries, the Class I railroads’ inadequate crews are having an undue impact on grain shippers and receivers, NGFA noted. For example: “When NGFA members cannot load a train because a crew is out with COVID, they will be charged demurrage by the rail line and if they cannot unload a train due to COVID, they will pay demurrage and face the risk of penalties or loss of contracts with their own customer,” Seyfert said. “However, if the railroad cannot deliver or move a train due to COVID – or any other reason – NGFA members cannot charge and are not entitled to any demurrage from the railroad.”

Latest News

First ore delivered at Rio Tinto Gudai-Darri mine in the Pilbara

(Posted on 20/06/22)

Rio Tinto has delivered first ore from the Gudai-Darri iron ore mine as the company brings online its... Read more


British Steel pressing ahead with £26 million investment

(Posted on 20/06/22)

British Steel has been given planning approval for a £26 million upgrade to its Special Profiles... Read more


Trafigura strong in testing times

(Posted on 12/06/22)

Trafigura Group Pte. Ltd, a market leader in the global commodities industry, released its half year... Read more


MoU to study using Rio Tinto iron ore in green steelmaking

(Posted on 08/06/22)

Rio Tinto and the Salzgitter Group have signed a Memorandum of Understanding (MOU) to work together... Read more


Bunge surpasses South American non-deforestation and sustainability targets

(Posted on 03/06/22)

Bunge has announced that it has exceeded its non-deforestation targets for monitoring and traceability... Read more


British Steel launches green hydrogen feasibility study

(Posted on 31/05/22)

British Steel is conducting a major study into the use of green hydrogen in the company’s drive... Read more


Trafigura makes further commitment to First Movers Coalition

(Posted on 25/05/22)

Trafigura Group Pte Ltd., a market leader in the global commodities industry, has made a new commitment... Read more


BHP inaugurates a new copper concentrator in Spence

(Posted on 18/05/22)

BHP CEO Mike Henry has led the opening of Spence's new copper concentrator plant.The project required... Read more


Schenck Process announces mining business sale to Sandvik

(Posted on 12/05/22)

Schenck Process, a global company for sustainable, integrated measuring and process technology solutions... Read more


BHP completes the divestment of its BMC interest

(Posted on 05/05/22)

BHP has completed the sale of its 80 per cent interest in BHP Mitsui Coal (BMC) to Stanmore SMC Holdings... Read more


TBA GroupMultimodal 2022The Wolfson Centre for Bulk Solids Handling Technology Van AalstCimbriaBühler GmbH
  • Port of South Louisiana
  • Vigan
  • TBA Group

Subscribe to our newsletter

Keep up to date with the latest global news in bulk cargo handling and shipping