Missouri farmers depend on reliable, affordable transportation to move crops from the field to processors, export terminals and markets around the world. At its annual convention earlier this year, voting delegates of the American Farm Bureau Federation decided to formally oppose the proposed merger between Union Pacific (UP) and Norfolk Southern (NS). For the nation’s largest general farm organization, representing farmers and ranchers in every state, that decision reflects a growing concern across the country.
For many agricultural producers, including those here in Missouri, the proposed $85 billion rail consolidation raises serious questions about competition, service reliability and the long-term resilience of the agricultural supply chain.
If approved, the merger would combine two of the nation’s largest railroads, controlling more than 40 percent of the U.S. freight rail system, including significant shares of agricultural commodities and inputs. For Missouri farmers, who often already have limited rail options, that concentration could reduce competition and increase the risk of costly delays. Agricultural shippers are especially vulnerable to further consolidation because demand for rail service is inelastic, farmers often have little ability to reduce shipments or switch transportation methods, even if rail costs increase.
Railroads are a vital link in moving crops from rural communities to domestic processors and global markets. Bulk commodities such as corn, soybeans and wheat depend heavily on rail transportation for long-distance shipments. As the American Farm Bureau Federation highlighted in their statement, farm and food products consistently account for roughly one-fifth of all freight moved by U.S. railroads. Much of that originates in the Midwest and moves through major logistics hubs like St. Louis on its way to processors or export terminals. For many farming regions, rail is the most affordable option, and in some cases, the only viable one.
Railroads are essential to the economy, but it’s essential that mergers that reshape the national rail system should be carefully reviewed. The first major decision from the Surface Transportation Board (STB), rejecting the application as incomplete, should be reassuring.
As the STB continues its review, it must maintain the same rigor it has shown so far. The concern voiced by the American Farm Bureau Federation is straightforward: farmers already have limited transportation choices. Further consolidation risks leaving them with even fewer. A competitive freight rail system is essential to keeping agriculture moving, prices stable and rural economies strong.
Rural conservative activist and proud husband and father. He resides in Southeast Missouri with his family.
