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ND oil trains cause large backlogs for grain shipments

The oil boom in North Dakota is taking up rail capacity that previously served agriculture for grain shipments, and state and federal leaders are taking notice.

The New York Times reported that oil shipments are causing massive backlogs of grain to pile up, which puts the product at risk and hurts both farmers and the food companies that buy the grain.

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In the week that ended Aug. 22, Burlington Northern Santa Fe Railway had a backlog of 1,336 cars, while Canadian Pacific had a backlog of nearly 1,000, the Times said, citing federal data.

The Department of Agriculture said this week that it was concerned that the problem could prevent railways from carrying nearly 30,000 carloads by October.

That spurred North Dakota’s congressional delegation and state lawmakers in nearby states to petition the Surface Transportation Board to step in and use its emergency authority, which it rarely does.

A recent study by North Dakota State University concluded that the state’s farmers could lose $160 million as grain backlogs cause prices to fall. The backlogs are also hurting food makers like General Mills and Cargill, the companies told investors.

Freight railroads told the Times they do not prioritize one kind of shipment over another and are working to mitigate backlogs and bottlenecks.