• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer

National Grain and Feed Association

Over a Century of Service Protecting Your Business Interests

  • Sign In
  • News
    • NGFA News
    • Newsletter Archive (members only)
    • Press Releases
    • COVID-19 Updates
    • Podcast
  • Issues
    • Feed
    • Safety
    • Trade
    • Farm Bill
    • Biotechnology
    • Transportation
    • Barge Digital Transformation (BDT) Project
  • Events
    • Calendar of Events
    • Event Sponsorship
    • Ag Transportation Summit
    • Convention
    • Country Elevator Conference & Trade Show
    • NextGen
    • CONVEY
    • NGFA-PFI Feed and Pet Food Joint Conference
    • FSMA Courses
    • Trade Rules Seminar
    • Stand Up for Grain Safety Week
  • Training
  • Advocacy
  • Arbitration
    • Arbitration Overview
    • Decisions
    • File a Complaint
    • Volunteer
  • Trade Rules
    • Trade Rules Overview
    • Trade Rules Committee
    • Order Rules Booklet
  • About
    • Officers and Staff
    • Committees
    • Strategic Alliances
    • State/Regional Affiliate Associations
  • Membership
    • Join the NGFA
    • Benefits & Services
    • Get Involved
    • Member Companies
    • Membership Directory (members only)
    • Next Generation Agribusiness Leaders
    • Committee Apprentice Program
  • Foundation

10.21.20 Press Releases, Transportation

NGFA testifies on state of the rail network at Senate hearing

WASHINGTON, Oct. 21, 2020 – National Grain and Feed Association (NGFA) President and CEO Randy Gordon offered suggestions for improving the rail regulatory framework to address limited rail-to-rail competition in testimony before the Senate Committee on Commerce, Science and Transportation on Oct. 21.

NGFA thanked Chairman Roger Wicker, R-Miss., and Ranking Member Maria Cantwell, D-Wash., for examining the current state of the rail network, including impacts of COVID-19 and legislative considerations for surface transportation reauthorization.

In his testimony, Gordon commended the actions of the rail industry in continuing to provide service and communicating with its agricultural customers during the pandemic. “Our member companies generally have been pleased with both aspects – service and communications – from their rail carriers during this period,” Gordon said.

However, Gordon said two major issues that existed before the pandemic continue to contribute to what many NGFA-member companies consider to be a “tipping point” concerning the extent to which rail service is reliable and cost-effective for agriculture. He specifically cited the lack of rail-to-rail competition, with Class I railroad duopolies now operating in the East and West that haul 80 percent of grain and oilseed traffic, with many grain facilities captive to a single carrier; and railroads’ adoption of an operating model in which carriers drive their operating ratios to potentially unsustainably low levels to reward shareholders at the expense of customers. 

“In looking to the near-term future this fall and winter, there is nervous apprehension within our industry about whether railroads will be able to keep pace with what we all hope will be a very robust demand for rail service given strong grain and soybean sales and a rebounding economy, complicated by the vagaries of winter weather,” Gordon said. But a longer-term concern, he said, is “the potential effect on service of the implementation of the so-called ‘precision scheduled railroad’ (PSR) operating model by six of the seven Class I carriers.”

The adoption of the PSR operating model “has resulted in increasingly arbitrary, abrupt and disruptive changes to operating plans, service schedules and the type of rail service offered,” Gordon said. “Further, by reducing crews and customer service personnel, and idling locomotives – both more quickly and sharply than before – PSR has raised questions about whether railroads have enough surge capacity to respond quickly to increased demand for service,” he said.

NGFA commended the Surface Transportation Board (STB) for “being extremely active and making considerable strides under Chairman Ann Begeman’s leadership” in implementing the STB Reauthorization Act of 2015 and attempting to create a more workable regulatory framework within the agency for addressing and resolving disputes between railroads and their customers.

NGFA offered two specific policy matters for the committee to explore with the STB with respect to its future rail regulatory framework:

  • Clarify Common-Carrier Obligation of Railroads: NGFA said there is a pressing need to clarify what the railroads’ common-carrier service obligation means in the 21st century, which is characterized by reduced rail competition and PSR-related operational changes that raise questions about whether carriers are indeed providing “transportation service upon reasonable request.” The rail common carrier obligation – required under federal law – has never been defined by Congress, the STB or its predecessor, the Interstate Commerce Commission, NGFA noted.
  • Reprioritizing the Importance of Rail-to-Rail Competition in U.S. Rail Transportation Policy: NGFA also said Congress should consider giving a higher priority to the importance of rail-to-rail competition within the Staggers Rail Act’s Rail Transportation Policy. Forty years after enactment of the Staggers Act, NGFA said believes it is important “to enshrine the importance of promoting rail-to-rail competition as part of the Rail Transportation Policy to encourage competitive switching and other pro-competitive policies.”

Finally, NGFA recognized the reluctance of most rail customers to formally challenge the behavior of their rail carriers at the STB, a court or in private-sector arbitration, even when justified, because they have no alternative competitive transportation mode, want to maintain a good working relationship with their carrier, and have a fear of potential retaliation from the railroad. 

“This again underscores the need for more competition as part of an effectively functioning regulatory framework,” Gordon said.

Read NGFA’s full testimony here.

-30-

NGFA, established in 1896, consists of more than 1,000 grain, feed, processing, exporting and other grain-related companies that operate more than 7,000 facilities and handle more than 70 percent of all U.S. grains and oilseeds. Its membership includes grain elevators; feed and feed ingredient manufacturers; biofuels companies; grain and oilseed processors and millers; exporters; livestock and poultry integrators; and associated firms that provide goods and services to the nation’s grain, feed and processing industry. NGFA also consists of 33 affiliated State and Regional Grain and Feed Associations, and NGFA is co-located and has a strategic alliance with North American Export Grain Association, and a strategic alliance with Pet Food Institute.

sidebar

Blog Sidebar

Topics

  • Issue Advisory (18)
  • Newsletter (1,795)
  • Press Releases (256)
  • Subject-focused News (1,708)
    • Agriculture Policy (255)
    • Arbitration (35)
    • Biotechnology (104)
    • Education and Training (40)
    • Event News (212)
    • Feed (288)
    • Foundation (8)
    • NGFA (82)
    • Risk Management (131)
    • Safety, Health & Environment (189)
    • Trade (249)
    • Transportation (306)
  • Uncategorized (22)

Footer

National Grain and Feed Association

TwitterYoutubeFacebookLinkedin

Contact Us

ngfa@ngfa.org
1400 Crystal Drive, Suite 260
Arlington, VA 22202
202.289.0873

Member Login

Have an account? → Log in 
Need an account? → Register
Lost your account? → Reset

Manage Your Account

Copyright ©  2021 NGFA | All Rights Reserved | Powered by Lanergy Solutions
  • Sign in

Forgot your password?

Lost your password? Please enter your email address. You will receive mail with link to set new password.

Back to login

Lacy Holleman
Manager of Legal Affairs and Arbitration

lholleman@ngfa.org

Lacy provides staff support for one of NGFA’s premier member services – its more than century old system of industry trade rules and arbitration that facilitates the efficient marketing of grains, oilseeds and their derived products. She also works on contracting, legal and other related matters.

An Arkansas native, Lacy received her undergraduate degree with a double major in history and Russian studies from the University of Tulsa (Okla.) and her law degree from Wake Forest University in Winston-Salem, N.C. Prior to joining NGFA’s staff in November 2020, she managed a local business at the Pentagon and completed mediation training required by the North Carolina Supreme Court for those seeking to serve as mediators for settlement conferences and other settlement procedures in North Carolina Superior Court civil actions. She also has worked as an assistant for a law firm in her native state.