East Central SD | I hate to say it, but I think we have reached another plateau on transportation costs with the railway issues that are not going away for a long while until the rail industry experiences enough time for capital investments into locomotives, rail line improvments, and rail line additions to come to fruition. Less turns from the interior to the destination results in less elasticity in trading rail and higher cost. There is only a certain number of cars and number of locomotives available which are now just that much more valuable to the grain industry (or any other industry that uses rail).
Car costs can relax with improvement in rail movement, but my guess is that we can disregard historical values as any type of benchmark to make decisions off of or that we will return to. We can all speak at hearings, call our Representative or Senators, but at the end of the day every industry that uses rail still has product to move that has overrun the railways. It's going to take time to "heal" our problems. High prices are the cure for high prices . . . but don't bank on that cure coming sooner than later. |