America’s farmers know a bad deal when they see one. That’s why two prominent national farmers’ groups made headlines this week by voicing concerns that the proposed Union Pacific-Norfolk Southern merger will drive up costs for farmers and consumers.
On September 25, the National Farmers Union (NFU) announced its opposition to the merger and called upon the Surface Transportation Board to reject the application. “History has shown us that when railroads consolidate, family farmers pay the price,” said NFU President Rob Larew. “Decades of mergers have left farmers with fewer options, higher rates, and less reliable service. Rail mergers that reduce competition leave shippers paying high rates for unreliable service, adding strain that family farmers cannot afford.”
On September 28, radio station KCUR, the National Public Radio affiliate in Kansas City, reported that growing diesel costs have caused railroad fuel surcharges to double over the past year. The Soy Transportation Coalition said those costs often trickle down to farmers. If that weren’t challenging enough, Mike Steenhoek, a spokesman for the Soy group, said the proposed UP-NS merger could also lead to even higher costs for transporting grain.
“One of the things that we have seen throughout history is that when you limit the number of transportation providers competing for the business of a shipper, in agriculture, in this case, that often results in higher rail rates being assigned to that railroad customer,” Steenhoek said. “As a customer, you don’t want all the power to be on the other side of the table.”
The Teamsters Rail Conference, comprised of BLET and BMWED, is a member of the Stop the Rail Merger Coalition. The Coalition represents a broad cross-section of the U.S. economy and is united against a merger that would weaken the railroad workforce, reduce competition, increase costs, and weaken America’s supply chain.