Technical Reports

Impact of Railroad Contracts on Corn, Wheat and Soybean Bids to Elevators and Farmers

  • 01
  • Jul
  • 1987
AUTHOR: Phillip C. Baumel, Steven Hanson, Robert Wisner
OFFICE: RPD
REPORT NUMBER: DOT-FRA-RRP-87-01
SUBJECT: Social & Economic Impacts
KEYWORDS: Grain Elevators, Rail Transportation, Staggers Rail Act of 1980
ABSTRACT: This report presents the results of research conducted to determine the impact of destination and origin railroad contracts on grain bids to elevators and farmers. The impact of destination contracts on grain bid prices to elevators was estimated by comparing bid prices for rail delivered grain at markets with destination contracts with truck delivered bid prices at the same market or at alternative markets. The impact of destination and origin contracts on grain bid prices to farmers was estimated by a series of linear regressions which regressed grain bid prices to farmers on contract-free bids to elevators, mileage and carpool allowances on elevator-owned or leased cars, destination contract premiums, the existence of origin contracts, elevator utilization, the number of competing elevators located within 20 miles of the responding elevators and years. Separate analyses were made for corn-soybean areas in Iowa, Nebraska, South Dakota and Minnesota, for southern wheat producing areas in Kansas and Oklahoma and for northern wheat producing areas in North Dakota, South Dakota and Minnesota.

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