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What happen to Milwaukee Road?

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Posted by MichaelSol on Saturday, June 10, 2006 12:45 AM
Just as I have always felt my personal life and career was none of your business, nor my political contributions, but you always made it fair game for your comments.

However, in this instance, a testimonial about how you argue in a national public position coincides exactly with how you argue about railroads.

The usual double standard from you, but an intriguing testimonial that has nothing to do with the substance of the dog debate, but explains that the manner of how you attack people on Trains forums has nothing to do with the substance of the discussion, but rather how you discuss things.
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Posted by greyhounds on Saturday, June 10, 2006 12:38 AM
QUOTE: Originally posted by rrandb

QUOTE: Originally posted by MichaelSol

Odd how the letter fits, precisely how you argue about railroads. And the fact that you carefully appeared to deny what arbfbe stated ...
WOW... The whole Dog-MILW connection has plumb evaded me. While I suspected you had spent time in D.C. before any doubts have evaporated. Proffesional SPIN


Well, Sol will use anything he can, including false animal rights propaganda, to discredit me.

He can not refute my arguments so he goes to animal rights people and their lies to smear me. That's his connection.

I don't think it belongs on a railroad discussion board, but I'm not going to go "tell on him". I'll just give him enough rope.
"By many measures, the U.S. freight rail system is the safest, most efficient and cost effective in the world." - Federal Railroad Administration, October, 2009. I'm just your average, everyday, uncivilized howling "anti-government" critic of mass government expenditures for "High Speed Rail" in the US. And I'm gosh darn proud of that.
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Posted by rrandb on Saturday, June 10, 2006 12:09 AM
QUOTE: Originally posted by MichaelSol

Odd how the letter fits, precisely how you argue about railroads. And the fact that you carefully appeared to deny what arbfbe stated ...
WOW... The whole Dog-MILW connection has plumb evaded me. While I suspected you had spent time in D.C. before any doubts have evaporated. Proffesional SPIN
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Posted by MichaelSol on Friday, June 9, 2006 11:48 PM
A "NATIONAL SPOKESMAN" and an "industry propagandist" and you claim that is your personal life?

Odd how the letter fits, precisely how you argue about railroads. And the fact that you carefully appeared to evade what arbfbe suggested and demanded an apology ...

You owe him an apology.
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Posted by greyhounds on Friday, June 9, 2006 11:28 PM
QUOTE: Originally posted by MichaelSol

QUOTE: Originally posted by greyhounds

QUOTE: Originally posted by arbfbe

I Greyhounds. What a piece of work. You demand more and more figures and when they are provided you trip over them, kick them around and then come to the conclusion that everyone and I mean everyone else is wrong. Stick with your directorship of the greyhound racing group. Now there is an industry with a bright future. Stick around long enough and you will get a feeling of how the thousands of MILW employees felt as their livelihoods slipped away.


(emphasis added by me)
?
Just to correct this one.

I hold no position of any authority as a director or anything else with regards to Greyhound racing. I love Greyhounds and Greyhound racing and I am a member of the National Greyhound Assoiciation, but that's it. The last racing dog I owned, "Waylan The Greyt", was retired and placed as a pet last fall. In 13 years as an owner/breeder I made money one year.

I did it for the love of the dogs and I certainly never expected anyone else to make up my financial losses.

Now, I'll accept your apology.

Just as a note: I also owned "Streamliner" and "Hiballin Z Train".

Ken Strawbridge

Interesting. A letter just two and one-half years ago ... Strawbridge accused of "spreading industry propaganda" ... can't imagine ...

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2003/11/19/HO113090.DTL

"Greyhound lovers need no help from racing spokesman

Editor -- Regarding Eileen Mitchell's articles describing her rescued greyhound's lovely antics ("How do I love thee?" Dog's Life, Nov. 8), it never ceases to amaze me the lengths that the racing industry spokesperson, Ken Strawbridge, will go to in order to spread industry propaganda at the expense of hardworking greyhound advocates; advocates who have been instrumental in uncovering greyhound abuses and deaths for the last two decades.

As I read proclamations from Mr. Strawbridge of how humane the greyhound racing industry is, one question comes to mind: Mr. Strawbridge, why are you, and your industry, completely out of touch with the abuses and deaths uncovered by the Greyhound Protection League if your industry is effectively self-policing? And at what point do the number of greyhound deaths no longer fit your definition of "isolated," a popular industry term so often quoted by you and your like in the media?

If your industry was truly humane, Mr. Strawbridge, then it would be your industry uncovering all these abuses and not the mother of two with a full- time job that lives in a nonracing state, and other such hardworking volunteers.

The industry will do itself a favor by acknowledging and encouraging the hard work of outsiders who have for years exposed greyhound cruelty and fought to bring the perpetrators to justice, instead of attempting to publicly humiliate them. But that would require a sense of humanity. "

Sounds like the rail industry comments as well. Maybe arbfbe deserves the apology ...


Oh jeese. Well, if the animal rights people say it, and it serves Sol's purpose, he'll use it against me. Of course they're liars. But aparently that don't make no never mind to Mr. Sol.

The Greyhound Protection League is an animal rights/activist group headed by one Susan Netboy of California. Like all activist groups their main area of expertise is in manipulating the media.

They'll also lie. i.e., Netbory was quoted in the Andersonville, SC paper as saying we "start out by killing 20% of the puppies." How malicously silly. Nobody would pay $1,250 for a straw of semen then kill the puppies. You generally don't know how a dog is going to run until it hits the track.

What GPL does is manipulate Greyhound registration numbers and rely on gulible reporters who don't check facts or bother to get both sides of the story. Sol would be proud. I can reference other GPL lies, such as when some skinned coyotes were found near Waterloo, IA and Netboy called the paper running on and on about how they were Greyhounds.

The GPL has taken the number of puppies whelped, including stillborns, subtracted the number of dogs registered to go to a track and falsely claims we "cull" or kill the 20% or so of the dogs not registered to go to the track. It's an outright lie.

Puppies have a mortality rate. Purebred pups of all breeds have a mortality rate that is shockingly high by human standards. According to Dr. Mark Haskins, Prfessor of Pathology at the University of Pennsylvania School of Veterinary Medicine:

"The importance of the autopsy in this age group is underscored by the statistics: among purebred dogs, ten percent are stillborn or die before their first veterinary examination and nearly 20 percent die within the first week of life. Overall pre-weaning mortality is 30 to 45 percent."

Source: www.vet.upenn.edu/schoolresources/communications/publications/bellwether/47/canine-symposium.html

Now animal rights groups such as the GPL will rely on the general publics' ignorance of this fact to falsely claim we "start off by killing 20% of the puppies." We do a lot better than most breeders. Heck, we only loose 20% from whelping to track (about 18 months of age). According to Dr. Haskins, the average is to loose 20% in the first week of life. We've kept the breed healthy and we know how to care for pups.

They lie about other things too.

Over the years I was involved in Greyhound racing as a dog owner and a breeder we averaged around 5-6 people per year who were found to have provided improper stewardship for Greyhounds in their care. When a rational person considers the 1,000's of people involved in breeding, raising, training, and racing these wonderful dogs, they realize, as I do, that that is a "Greyt" record for animal welfare. People found guilty of "improper stewardship" are removed from racing. They also face whatever penalties the legal system dishes out. We're doing at least two 9's.

The system is set so that every dog is checked by a veterinarian before every race, and we operate a breeder inspection program to ensure the welfare of these magnificent animals. No other domesticated animal enjoys the protection afforded a racing Greyhound. They have a good life. And they have a long life.

Greyhound adoption is a great animal welfare succes story.

But Sol will quote an animal rights activist in her "letter to the editor" in an effort to persoanlly attack me. It's an old trick, if you can't refute the argument, discredit the source, even if your source is an unverified letter to the editor from a member of an animal rights group.

Now, let's take it back to railroading and leave my personal life out of it. Or are you so devoid of integrity that you will use animal rights false propaganda to further your political crusade.

Ken Strawbridge


"By many measures, the U.S. freight rail system is the safest, most efficient and cost effective in the world." - Federal Railroad Administration, October, 2009. I'm just your average, everyday, uncivilized howling "anti-government" critic of mass government expenditures for "High Speed Rail" in the US. And I'm gosh darn proud of that.
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Posted by rrandb on Friday, June 9, 2006 11:14 PM
QUOTE: Originally posted by MichaelSol

QUOTE: Originally posted by MP173
I have made my points, and quite clearly so. Nearly all costs involved in agriculture have increased over the past 30 years.


Question: did rail rates to Montana wheat shippers go up or down as a result of becoming captive shippers after the Milwaukee Road left?
Up. Was the area able to generate enough proffitable traffic to justify more than one railroad. No
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Posted by MichaelSol on Friday, June 9, 2006 10:18 PM
QUOTE: Originally posted by greyhounds

QUOTE: Originally posted by arbfbe

I Greyhounds. What a piece of work. You demand more and more figures and when they are provided you trip over them, kick them around and then come to the conclusion that everyone and I mean everyone else is wrong. Stick with your directorship of the greyhound racing group. Now there is an industry with a bright future. Stick around long enough and you will get a feeling of how the thousands of MILW employees felt as their livelihoods slipped away.


(emphasis added by me)
?
Just to correct this one.

I hold no position of any authority as a director or anything else with regards to Greyhound racing. I love Greyhounds and Greyhound racing and I am a member of the National Greyhound Assoiciation, but that's it. The last racing dog I owned, "Waylan The Greyt", was retired and placed as a pet last fall. In 13 years as an owner/breeder I made money one year.

I did it for the love of the dogs and I certainly never expected anyone else to make up my financial losses.

Now, I'll accept your apology.

Just as a note: I also owned "Streamliner" and "Hiballin Z Train".

Ken Strawbridge

Interesting. A letter just two and one-half years ago ... Strawbridge accused of "spreading industry propaganda" ... can't imagine ...

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2003/11/19/HO113090.DTL

"Greyhound lovers need no help from racing spokesman

Editor -- Regarding Eileen Mitchell's articles describing her rescued greyhound's lovely antics ("How do I love thee?" Dog's Life, Nov. 8), it never ceases to amaze me the lengths that the racing industry spokesperson, Ken Strawbridge, will go to in order to spread industry propaganda at the expense of hardworking greyhound advocates; advocates who have been instrumental in uncovering greyhound abuses and deaths for the last two decades.

As I read proclamations from Mr. Strawbridge of how humane the greyhound racing industry is, one question comes to mind: Mr. Strawbridge, why are you, and your industry, completely out of touch with the abuses and deaths uncovered by the Greyhound Protection League if your industry is effectively self-policing? And at what point do the number of greyhound deaths no longer fit your definition of "isolated," a popular industry term so often quoted by you and your like in the media?

If your industry was truly humane, Mr. Strawbridge, then it would be your industry uncovering all these abuses and not the mother of two with a full- time job that lives in a nonracing state, and other such hardworking volunteers.

The industry will do itself a favor by acknowledging and encouraging the hard work of outsiders who have for years exposed greyhound cruelty and fought to bring the perpetrators to justice, instead of attempting to publicly humiliate them. But that would require a sense of humanity. "

Sounds like the rail industry comments as well. Maybe arbfbe deserves the apology ...
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Posted by n012944 on Thursday, June 8, 2006 2:57 PM
QUOTE: Originally posted by FJ and G

I find it interesting that many mourn the passing of the Milwaukee Road but so few mourn the loss of half the trackage of Conrail when it decided to please its shareholders.


While not wanting to get into a Conrail discussion on the MILW thread, I feel the need to correct you on one thing. When most of the Conrail trackage was "lost" Conrail did not have shareholders, it was owned by the US goverment. It was not trying to "please" the goverment, but keep some rail lines viable in the northeast.


Bert

An "expensive model collector"

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Posted by Anonymous on Tuesday, June 6, 2006 9:14 PM
QUOTE: Originally posted by FJ and G

I find it interesting that many mourn the passing of the Milwaukee Road but so few mourn the loss of half the trackage of Conrail when it decided to please its shareholders.


I'll give several reasons

1. Conrail had a lot of redundant trackage - Milwaukee's PCE was just one line.
2. Even after the breakup of Conrail between NS and CSX, most areas of the Northeast still have at least two Class I's competing - the loss of the PCE resulted in a vast swath of the US falling into captive shipper status.
3 Milwaukee had the mountain electrification, the Little Joes et al - Conrail's electrification is still in place, and was mostly predicated for transit, not freight.
4. The Hiawatha symbol beats the corporate blue and "C" hands down.
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Posted by FJ and G on Tuesday, June 6, 2006 9:27 AM
I find it interesting that many mourn the passing of the Milwaukee Road but so few mourn the loss of half the trackage of Conrail when it decided to please its shareholders.
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Posted by Murphy Siding on Monday, June 5, 2006 9:03 PM
QUOTE: Originally posted by futuremodal

QUOTE: Originally posted by chad thomas




If the laws of physics regarding molecular density are indeed valid, I would have though Murphy's head would implode rather then explode.[;)] Okay, Murph, your turn[B)]


'Round these parts, we spell thought with a "t" on the end. Makes it easier to understand, don'tcha know.[;)]

( Hey, at least we're not calling each other names.[:)])

Thanks to Chris / CopCarSS for my avatar.

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Posted by Anonymous on Monday, June 5, 2006 8:37 PM
QUOTE: Originally posted by chad thomas




If the laws of physics regarding molecular density are indeed valid, I would have though Murphy's head would implode rather then explode.[;)]





Okay, Murph, your turn.[B)]
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Posted by chad thomas on Monday, June 5, 2006 4:59 PM
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Posted by Murphy Siding on Monday, June 5, 2006 4:44 PM
Well............I don't plan on having my head blow up intentionally, if that's what you mean.[(-D]

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Posted by MichaelSol on Monday, June 5, 2006 4:41 PM
Well hang on, when I make an error I correct it; unlike some who make intentional "errors" to support unsupportable contentions and mislead people.
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Posted by Murphy Siding on Monday, June 5, 2006 4:37 PM
QUOTE: Originally posted by MichaelSol

Since I didn't bring any of these numbers up to begin with, I'm not supporting anything with them. However, I should correct myself, I was indeed looking at a CPI adjusted chart, showing $1.80 a gallon in 1974. It is true energy costs have gone up; but energy consumption has gone down significantly and Ed doesn't account for that at all; just raw numbers that don't support anything because there is no context or meaning.


You have just given a perfect example of why I, and a fair amount of others, have a hard time following your numbers and reasoning.

And an example of how I feel when you throw a lot of numbers out there.. I know I'm not the only one.[;)]

Anyway, I do thank you for the info you provide about The Milwaukee Road. I do find that interesting, and quite readable. As far as the math and economics is involved, it reminds me of a surveying instructor in college. The guy could probably survey South America single-handedly, but couldn't explain it to anyone else. Therefore, I have to swear off this thread, before my head explodes.[;)] Beam me up, Scottty[alien]

Thanks to Chris / CopCarSS for my avatar.

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Posted by MichaelSol on Monday, June 5, 2006 4:33 PM
QUOTE: Originally posted by MP173
I have made my points, and quite clearly so. Nearly all costs involved in agriculture have increased over the past 30 years.

Aside from questionable data, that was simply never the contention. No one said they didn't.

You have completely changed the point from one you refuse or are unable to address, to one that is completely irrelevant to the question initially posed.

Question: did rail rates to Montana wheat shippers go up or down as a result of becoming captive shippers after the Milwaukee Road left?

Your answer: the price of combines and fuel went up everywhere.

That is why I termed the direction of your conversation "bizarre" which was a little strong, "inexplicable" would have been a better choice of words. But, that direction has no meaning in the context of the thread.
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Posted by MP173 on Monday, June 5, 2006 4:08 PM
I paid 50 cents a gallon (more or less in 1974). I paid $2.89 recently. Hence the increase.

Fuel is used in agriculture. Not only in implements but also in the drying of grains. Perhaps you dont dry wheat, but corn is dried usually using propane.

I have made my points, and quite clearly so. Nearly all costs involved in agriculture have increased over the past 30 years.

The revenues have not. Therein lies the problem. If the revenue is being suppressed by the opening of new markets by transportation, then that is a natural economic evolution. I can think of several industries which have been impacted over the last 30 years by economic evolution:

1. Domestic textile manufacturing
2. Domestic shoe manufacturing
3. Domestic television manufacturing
4. Domestic automotive manufacturing
5. Numerous more

In additions to areas and communities impacted by the above displacements and hardships, there have been military bases closed in many locations.

Industries which are commodity based live and die by the prices of those commodities, be it oil, copper, wheat, silver, gold, etc. The real key is that commodities are subject to the current demand and supplies. Econ 101, if I am not mistaken.

ed


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Posted by MichaelSol on Monday, June 5, 2006 3:31 PM
Since I didn't bring any of these numbers up to begin with, I'm not supporting anything with them. However, I should correct myself, I was indeed looking at a CPI adjusted chart, showing $1.80 a gallon in 1974. It is true energy costs have gone up; but energy consumption has gone down significantly and Ed doesn't account for that at all; just raw numbers that don't support anything because there is no context or meaning.

You kind of like this refrain "they just don't support what you're saying," however, in this instance, since I have no idea what the price of gas has to do with the Staggers Act and railroad pricing policy under that Act with regard to captive shippers, you will just have to ask Ed how they support ... whatever it is he is saying.
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Posted by METRO on Monday, June 5, 2006 3:24 PM
See now there is one quite interesting thing in compairing the Milwaukee with the other Northern Transcons and Midwest Regionals: The Milwaukee outlived (unmerged) all of them, except the CNW and skirted the fate of the Rock. BN was formed of the GN, NP, CB&Q and SP&S in 1970. Three of the Milwaukee's biggest rivals were contained in that merger, joining forces and pooling their resources. The Milwaukee was up against the CNW, the superior midwestern carrier, and against the BN juggernaut not on on its transcontinental route but also in the midwest. The CRI&P died a horrible death in 1980 and the Milwaukee was in a state of living death at this point, maninly though their own doing.

However, much like the city of Milwaukee itself, the Milwaukee Road seemed to have insane amounts of luck on their side. After shooting themselves by first de-electrifying the pacific extension and then by abandoning it, they should have gone the way of the Rock Island, blasted appart and picked clean by the surrounding railroads. But they didn't they lived long enough to get eaten by the SOO and eventually become the backbone of the Canadian Pacific in the Midwest.

Also while not really saying anything about business practice, but something of fate, there are still tons of freight cars in Milwaukee Road colors running around as well as enough engines (Bandits) around that they're a regular sight in Wisconsin. That's 21 years after the Milwaukee Road was consumed. Compaire that with how very little CNW equipment there is left only 11 years after being merged into the UP.

Cheers!
~METRO
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Posted by Murphy Siding on Monday, June 5, 2006 2:52 PM
QUOTE: Originally posted by MichaelSol
.

Fuel, lubricants and electric power are about 12-13% of the operating cost of a wheat ranch. Don't know if that qualifies as a "major" component, but again, I question where these numbers, this 450%, come from.

Gas prices in 1974 were approximately $1.80 per gallon. The average in 2005 was about $2.25 per gallon. Ag gets a tax break on these and so the numbers would be less in both cases, but according to the PPI, that cost too would be less, and even in actual dollars is only a 25% increase, not a 450% increase. Good heavens, are you really paying $8 a gallon?

There you go again......I don't remember gas hitting $1.80 in 1974, but it may have. Was that the average, since you're comparing it to the 2005 average? Is $1.80 1974 gas equal to $8.00 2006 gas? I found it almost,....um.....bizarre[:)], that you are throwing out a lot of numbers again, that don't seem to support what you are saying. I'm not disputing whether your numbers are right(or wrong), just that they don't seem to support what you're saying.[;)]

Thanks to Chris / CopCarSS for my avatar.

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Posted by MichaelSol on Monday, June 5, 2006 1:04 PM
QUOTE: Originally posted by MP173
I checked Deere's prices...up nearly 500% for tractors and combines. I checked nitrogen, up 366%. I didnt check property taxes, nor Electric co-op prices. But, fuel prices, a major component of farming have increased by about 450%.

Well, your nitrogen prices are probably spot prices. They don't reflect the period we have been discussing, nor do they accurately reflect the statistical record which I specifically linked above. Yes, you can cherry pick prices and costs all over the place, but our data set is 2000-2005.

Fuel, lubricants and electric power are about 12-13% of the operating cost of a wheat ranch. Don't know if that qualifies as a "major" component, but again, I question where these numbers, this 450%, come from.

Gas prices in 1974 were approximately $1.80 per gallon. The average in 2005 was about $2.25 per gallon. Ag gets a tax break on these and so the numbers would be less in both cases, but according to the PPI, that cost too would be less, and even in actual dollars is only a 25% increase, not a 450% increase. Good heavens, are you really paying $8 a gallon?
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Posted by MP173 on Monday, June 5, 2006 12:40 PM
I purposely stated that the local guy has a tough time. I am not avoiding the issue that farming is tough. He even said in passing "kinda makes me wonder why I still do this (farming)". No doubt why he has two jobs.

The reasoning I went off in a "bizarre" direction is that the term relative prices was brought into the discussion. So...I went out and retrieved some "relative prices".

I thought that combines were not used for the western wheat, but not being familiar with the proceedure, used a combine to show the increase in costs of equipment since 1974. I recall you stating that

"well, if Deere, and if Monsanto, and if property taxes & if the Electric Co-op had gone up as much as BN" then costs would be $8 per bushel.

I checked Deere's prices...up nearly 500% for tractors and combines. I checked nitrogen, up 366%. I didnt check property taxes, nor Electric co-op prices. But, fuel prices, a major component of farming have increased by about 450%.

So, my bizzare path has been to make a comparison between relative prices of certain products and services used in the farming industry. In relative terms, all have increased, some much much more than others.

Now, I cannot begin to tell you the per bushel, nor the per acre cost of farming either in the Midwest or in Montana. I dont know the weighted costs of each component, but the ones I selected have seen much higher relative increases than transportation.

I understand differential pricing exists in transportation. One of my early career tasks was in pricing for trucking. It varied from customer to customer. Pricing in my current sales job varies from customer to customer, sometimes it varies within the same customer, based on conditions.

I am not an apologist for the BNSF... dont work for them, dont sell to them, dont own stock. I think they have some work to do within their organization, but overall I believe they are a solid railroad. I dont know or understand your local conditions.

Differential pricing is reality at this time. I have offered very sound advise as to how to lower the transportation costs of Montana wheat. It has worked in other industries, whether or not it would work there remains to be seen.

I have tried to address this in a logical, open minded manner. I understand about the lower rates now opening up more markets to Portland. I am not sure of the entire economics involved and at this time, I have customers to care for.

ed
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Posted by MichaelSol on Monday, June 5, 2006 12:39 PM
Taking that interesting new combine cost analogy a step further.

On a 1400 acre farm, raising 28 bu of wheat per acre, that new combine would cost 35087 bushels of wheat, and produce 39,200 bushels per year. If it's good for 15 years, it will produce 588,000 bushels. That's 588,000 bushels produced at a cost of 35,087 bushels of wheat.

The cost to ship all the wheat produced, 168 carloads, 121,464 bushels of wheat, about four times the cost of the combine.

In cow years, that means that the cost of the combine is approximately one-fourth the cost, per bushel produced, as the cost of transportation.

That's why the transportation cost is a key to profitability while the impact of the cost increase for a new combine relatively small.

Context, context.

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Posted by MichaelSol on Monday, June 5, 2006 11:17 AM
You are going off in a bizarre direction here.

The costs of farming have gone up. The costs to make a combine have gone up. The cost of nitrogen has varied, although these numbers would be quite different for Heartland wheat as opposed to Montana wheat. Montana soil is more fertile and needs less of any fertilizer.

The overall use of fertilizer as measured by energy inputs, interestingly, has declined by about 50% from use levels in the 1970s.Your extrapolation is probably off by a factor of 2 from that standpoint.

According to the USDA, the cost of a ton of 30% nitrogen solution in 1974 was $136. Over the past five years, it has ranged from $127 a ton to $189 a ton. Urea was $232 a ton in 1974. It has ranged from $191 to $280 during the past five years. Not sure about your friend's numbers there. Looks like relative costs have gone down. Since fertilizer can be between 30-50% of the operating cost for a wheat farm, I would see these numbers entirely differently than you do, and as a big reason why the farm market remained viable over the time period in question.

http://www.ers.usda.gov/Data/FertilizerUse/

We got rid of our combines in 1976. Much cheaper to have a custom cutter do it. It tends to be more common than not these days. You have to be careful in throwing in a bunch of numbers 36 years apart, for two different operating environments. Quite a bit more to the story than those raw numbers.

I suppose we could have a thread about the entire American economy, or about the relative efficiency gains of a combine now compared to a combine then, or a tractor now compared to a tractor then. Or comparing an operating expense to a capital cost.

Combines and fertilizer were never regulated. Competition works as it should

The interaction of deregulation of railroad rates and the impact on ag markets has been profound, not incidental.

The Portland market can now draw from nearly any producer west of Chicago at nearly the same cost of transportation as Montana shippers 32 years ago, when it was just too expensive to ship much further than Miles City or Mobridge. The supply is what, three, four, five times the supply available to that market as in 1974. The market is much larger because of cheaper rates, cheaper rates to all but captive shippers who pay more than they did 32 years ago.

How did that happen? John Deere didn't do it. Monsanto didn't do it. Railroads did it under deregulation by offering cheaper rates to a much broader market area. By one way of looking at it, it wrecked the market. Well, yeah, it's hard to survive for those growers who get the good rates.

So what about the grower who gets stuck with the higher shipping rates?

Deere isn't charging him selectively more. Monsanto isn't charging him selectively more.

Only the railroad is.

And that specifically breaks the agreement that Congress made when it permitted deregulation.

Hard enough to break even in your neck of the woods. On another thread, we looked at wheat transportation costs in Illinois and Iowa, About 12% of the market revenue received for the carload. I assume its similar for your guy. And he just breaks even, and given the high rate of subsidies in your area per acre compared to Montana, he gets a far greater subsidy than the average Montana farm which crops only 800 acres, probably half of that wheat.

Well, if he's having a hard time with 12% shipping cost margin and 8-10 times the amount of subsidy dollars, you can imagine the Montana farmer with a 25% margin and a much lower subsidy.

The fact is, that transportation margin differential is the one cost that makes all the difference. Deere doesn't charge a different price. Monsanto doesn't.

Only the railroad does, that differential is specifically governed by law, and the law is not being applied consistently or fairly. As you eloquently if unintentionally point out, if a guy with the transportation cost advantage can't make it, what happens to captive shipper -- even though he has the superior product, most closely located to the best market, and yet is priced out in favor of other growers by a policy of screwing the captive shippers to subsidize the non-captive shippers?

I look forward to your explanation of why that makes perfect sense.
  • Member since
    February 2002
  • 910 posts
Posted by arbfbe on Monday, June 5, 2006 11:10 AM
QUOTE: Originally posted by greyhounds

QUOTE: Originally posted by arbfbe

greyhound,

It is somewhat easy to be confused when a Yahoo search leads to this:

http://www.gra-america.org/b_kstrawbridge.html


I want the *** apology. The GRA was (is?) basically a group of racing fans. It had (has?)(has?) absolutely no official status vis a vis racing and neither did I. (other than as a licensed owner.) I haven't belonged for quite some time. Do you understand verb tense?

I think it's a nice picture of me though.

But, next time you want to get into my personal life you better GD have the facts right.

Ken Strawbridge


Well, don't hold your breath for that, you will turn blue and pass out.

Your reply about the greyhound posts are like your replies to the grain rate and MILW posts. Were, was, was not, am, is......no straight line to follow. Makes my head hurt.

So I am gone, again. There are better things to do with my time. Mr Sol has my deepest respect for all the stuff he puts up with here. Those of you who take the time to read and understand his posts will learn from them.

I also found the post about relative farming costs and the relationship between bushels to piece of equipment, supplies and services to be educational as well. Unfortnately to get to the wheat you have to sift through way too much chaff here.

Toodles,
Alan
  • Member since
    May 2004
  • From: Valparaiso, In
  • 5,921 posts
Posted by MP173 on Monday, June 5, 2006 10:32 AM
I dont think I have any pictures of me on the internet, but if anyone can find one, let me know.

Now, here are a few facts, based on a conversation with a Deere representative today:

In 1974 a Deere 4430 (140hp) tractor cost $14,000.
In 2006 a Deere 140 hp tractor costs $85,000, an increase of 507%

In 1974 a Deere 6 row combine costs $28,000
In 2006 a Deere 6 row combine costs $160,000, an increase of 471%

In 1974 a ton of nitrogen cost $120/ton
In 2006 a ton of nitrogen costs $560/ton, an increase of 366%

In 1974 the freight rate was $1500.
In 2006 the freight rate was $3300, an increase of 120%.

I do not disagree with you that the freight rates are a large percentage of your product revenue. Based on 1974 (44 cents vs $4.50 per bushel) and today of (94 cents vs $4.56) the relative costs have gone from 9.7% to 20.6%.

But, in relative terms in 1974 it cost 3111 bushels of wheat to purchase a 140 hp tractor. Today it costs 18640 bushels of wheat to purchase a 140 hp tractor.

Similarily:
1974 combine - 6222 bushels of wheat
2006 combine - 35087 bushels of wheat

1974 ton nitrogen - 26 bushels of wheat
2006 ton nitrogen - 122 bushels of wheat

1974 carload of freight - 333 bushels of wheat
2006 carload of freight - 723 bushels of wheat

These are relative numbers.

I have not considered the price of fuel for 1974 vs today... no need to.

I asked the Deere representative, who also farms 1400 acres..."how do you survive?" He responded that in 1974 a good yield was 120 bushels/acre of corn and today it is 180 bushels per acre. Their production has increased 50%. Yet, even with those increases, he says the break even on farming and profit based on the government subsidies.

Finally, I am NOT anti - farmer, nor am I anti - Montana, so dont even attempt that. I understand the difficulties of earning a living on the farm...I have chosen not to do that as my main income in my life.

I look forward to your responces.

ed
  • Member since
    October 2004
  • 3,190 posts
Posted by MichaelSol on Monday, June 5, 2006 8:12 AM
Yes, by all means, regarding Ken "get the facts right" Strawbridge, "get the facts right."

This must be where the Irony theme song begins to play ...
  • Member since
    April 2003
  • 305,205 posts
Posted by Anonymous on Monday, June 5, 2006 8:12 AM
It seems to me that some of you have a great deal of time on your hands and don't know what else to do with it.

Larry
  • Member since
    August 2003
  • From: Antioch, IL
  • 4,371 posts
Posted by greyhounds on Monday, June 5, 2006 7:09 AM
QUOTE: Originally posted by arbfbe

greyhound,

It is somewhat easy to be confused when a Yahoo search leads to this:

http://www.gra-america.org/b_kstrawbridge.html


I want the *** apology. The GRA was (is?) basically a group of racing fans. It had (has?)(has?) absolutely no official status vis a vis racing and neither did I. (other than as a licensed owner.) I haven't belonged for quite some time. Do you understand verb tense?

I think it's a nice picture of me though.

But, next time you want to get into my personal life you better GD have the facts right.

Ken Strawbridge
"By many measures, the U.S. freight rail system is the safest, most efficient and cost effective in the world." - Federal Railroad Administration, October, 2009. I'm just your average, everyday, uncivilized howling "anti-government" critic of mass government expenditures for "High Speed Rail" in the US. And I'm gosh darn proud of that.

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