In the middle of September, we had our annual National Farmers Union fly-in. This year was especially important, as we have been working on a Fairness for Farmers campaign to lower the impact of monopolistic practices. This is a huge challenge. Farmers, ranchers and consumers are being impacted by record profits in integrated systems owned by only a few companies.
The fly-in was also a time to begin dialogue on the 2023 Farm Bill and work to expand the use of renewable fuels, including ethanol, renewable diesel and sustainable aviation fuel. The importance of tying renewable fuels dialogue to the farm bill is necessary. We can lower the cost of the farm bill by creating real demand for our commodities, raise prices and lower the cost of farm programs. Farms would get their income from the market.
I could spend all day talking about all the concerns we addressed at the fly-in, but there is one area that needs continued focus. That is dealing with aspects surrounding transportation, specifically related to rail. We are all aware of the high rates and the lack of cars and shipping containers we face in North Dakota. We are also aware we are captive shippers. Many times, to ship a pound of product from North Dakota to the coast, compared to an equal distance in areas where they have many shippers, costs us substantially more per pound.
The challenge exists because of market concentration. We basically are down to four shippers that ship 95% of all commodities in the U.S. They do not overlap territory in very many locations and certainly not in North Dakota.
The rail industry is regulated by the Surface Transportation Board (STB). The STB reviews cases and complaints to determine the impact on captive shippers and if the rail system is treating all shippers fairly and equitably. We also have antitrust laws that if held to the standards of their intent would have limited railroad buyouts and takeovers many years ago. We are faced with challenges today due to decades of ignoring the impact of fewer and fewer rail companies.
Our efforts to draw attention to rail issues appears to be bearing more fruit. The STB has been using outdated matrixes to make determinations and when they make determinations, their solution to allow other rail companies to access lines to create competition have not been effective.
In meeting with the STB, they indicated they are developing a new matrix that will compare shipping rates from across the nation. The current matrices only look at shipping rates within the region where a railroad may service the same accounts. The new matrix will determine the variances due to captive shippers compared to locations where there are competitive markets with many railroads. If they discover abuse, they can then allow other railroads to access lines or fine the current rail at levels to force them into compliance.
— NDFU President Mark Watne