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Railcar shortage, higher transportation costs real in Midwest

A grain marketer says one of the downsides of a strong export market has been transportation. Chris DeLong with The DeLong Company says, “Railcar service has been horrible this year and probably for the last eight, nine months.”

The Wisconsin-based grain marketer says grain by rail out of Wisconsin and the Midwest has been challenging. “We had some shuttle orders (dedicated 100+ car trains) but we also ship a decent amount of singles, which is less than 100 cars, and we’ve been waiting on some cars for over three months, so the service has been awful.”

And, he says transportation problems are not limited to rail car availability. “Container rates have been going up here recently and barge rates are at some of the highest values they’ve been in probably the last eight, nine years. Every piece of freight that can haul grain right now given the export demand is booked up and it’s getting expensive to haul this stuff right now.”

DeLong says the transportation hiccups are not so much caused by COVID 19.  He says the U.S. has a record export program right now and a huge crop to export.

Chris DeLong was part of a panel discussion on grains at the virtual University of Wisconsin Ag Outlook Forum Tuesday.