WASHINGTON, DC – Rail fuel surcharges charged to grain shippers reached an all-time high in November, adding another transportation cost as producers and elevators move crops through the marketing system.
USDA’s Grain Transportation Report says the average Class I railroad fuel surcharge climbed to 76 cents per mile in November, 231 percent above the April level. The increase followed a sharp rise in diesel prices earlier this year.
Surcharges vary widely by railroad. BNSF is charging 61 cents per mile, Union Pacific 84 cents, Norfolk Southern 95 cents, while legacy Kansas City Southern and Canadian National are each at $1.04 per mile. Most programs are tied to highway diesel prices from about two months earlier.
USDA also notes that mileage changes can increase the total surcharge even when the per-mile rate is lower. On a Salina, Kansas-to-Houston wheat route, BNSF moved from being $9 per car cheaper than Union Pacific last month to $50 per car more expensive after route-mileage adjustments.
Some relief is expected in 2027. The Energy Information Administration projects retail diesel averaging about $4.50 per gallon, but prices are still expected to remain above $4 through the year.
Farm-Level Takeaway: Record rail fuel surcharges are adding to the cost of moving grain even as producers already face elevated fuel and input expenses.