Thursday, January 26, 2023

Wheat Industry Welcomes STB Rulings on Rail Rate Disputes

by Colter Brown

New U.S. Surface Transportation Board (STB) rulings provide more streamlined processes for rail rate disputes and may benefit agricultural shippers. The STB established a voluntary arbitration program and an entirely new procedure for rate challenges, known as Final Offer Rate Review (FORR).

U.S. wheat farmers and the grain trade rely heavily on rail to transport wheat to export terminals by rail, but rates for hauling wheat are often higher than for other crops. The U.S. Wheat Associates (USW) Transportation Working Group is pleased that the STB recognizes rail shippers need new and innovative ways to engage railroads on rate concerns.

“These rulings are a welcome sign that rail customers like wheat farmers are being heard. The voluntary arbitration program and the FORR process are intended to help give smaller shippers greater ability to challenge rail rates,” said Charlie Vogel, TWG chairman and executive director of the Minnesota Wheat Research & Promotion Council. “Under these programs, the railroads can agree to binding arbitration or allow the STB to review a dispute and determine a final reasonable rate.”

STB Chairman Martin Oberman noted that the Board has been looking for ways to make smaller rail disputes “accessible, reasonable, and less time-consuming.” However, he added that “the Board’s prior efforts to provide rate review methods suitable for smaller disputes have been rarely used by shippers. I am optimistic that this time the Board’s efforts will achieve this long-desired goal.” For more information visit www. https://www.uswheat.org/wheatletter/wheat-industry-helps-build-awareness-of-rail-shipping-challenges.

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U.S. Wheat Associates

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