Pipelines would ease rail freight capacity for US farmers


During the 2014 harvest, the average corn farmer in North Dakota received US$10,000 less than the prevailing rate for the same crop in the market and resulted in a US$570 million profit cut for the region. The main reason for this loss is that rail freight transportation in America is highly congested due to the spike in rail transportation of crude oil. According to a study by the American Farm Bureau Federation (AFBF), the expansion of North America’s pipeline infrastructure (especially in the Bakken region) would alleviate the overburdened freight rail network and in effect improve services for farmers who are very dependent upon the rail freight system to move their products to market.

Since crude oil is more flexible when it comes to methods for transportation, moving the crude oil to the market using pipeline infrastructure would be more efficient and would also enhance the American energy security. The study used mathematical simulated scenarios on how expansion of any freight method reduces the bottleneck in delivering goods and as a byproduct it presented the increase of annual volume of grains transported by around 14 percent. Read the full article here

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