By Terry Whiteside, Whiteside & Associates
(As reported in March 2011 MFU News)
March 2011 Transportation
On January 1st, BNSF adjusted Montana wheat rates by increasing Shuttle rates by $98/car, and reducing 48 car by $54/car, and increasing 1-23 and 24-47 car rates by $150/car. Again the criticism of this action against the less than shuttle loaders was heard by BNSF from Montana producers.
On March 1st, the BNSF “rebased” their rates from $1.25/gallon fuel to $2.50/gallon. What this means is the BNSF moved the difference in the fuel adjustment to a strike price of $2.50/gallon (Highway diesel price) and took the difference between $1.25 to $2.50/gallon and put it in the base rate. The effect of this would not normally change the overall total rate (base rate + fuel surcharge) because the increased base rate would occur because of added fuel from the adjustment change.
However, the BNSF did adjust rates - taking another increase of $45-$65/car on shuttles and increasing 48 cars by $55 to over $70/car all-the-while decreasing the 24-47 and 1-23 cars by $80-$115+/car. The farm producer will see that the reduction given 48 car rates in January, 2011 have now been increased on March 1, by more than they were reduced in January.