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Rail’s Loss of Grain Transportation Market Share

Author

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  • Prater, Marvin
  • Sparger, Adam
  • Bahizi, Pierre
  • O'Neil, Daniel Jr.

Abstract

The share of the grain and oilseed harvest moved by rail has been declining since 1980, when the Federal Motor Carrier Act and the Staggers Rail Act were passed. Large structural changes associated with these Acts affected the decline over the following two decades. Yet, even though the large structural changes had already taken place by 2000, the rail market share of grain and oilseed transportation continued to decline. A State-level statistical model for 21 of the top grain-producing States (which produce 86.6 percent of all grain and oilseeds) investigated the major factors responsible for the decrease in the rail market share of grain and oilseed transportation from 2001 to 2010. Although not every factor affecting the rail market share of grain and oilseed transportation could be captured, 10 statistically significant factors were identified. Of these factors, three were the most important: the growth of ethanol production, the growth of biodiesel production, and increases in animal feeding.

Suggested Citation

  • Prater, Marvin & Sparger, Adam & Bahizi, Pierre & O'Neil, Daniel Jr., 2013. "Rail’s Loss of Grain Transportation Market Share," Research Reports 161206, United States Department of Agriculture, Agricultural Marketing Service, Transportation and Marketing Program.
    • Handle: RePEc:ags:uamsrr:161206
    DOI: 10.22004/ag.econ.161206
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    Cited by:

    1. Sichao Jiang & James Nolan & Wesley W. Wilson, 2022. "Exit Decisions in the Canadian Grain Elevator Industry," Journal of Industry, Competition and Trade, Springer, vol. 22(1), pages 1-19, March.
    2. Nash, Chris A. & Smith, Andrew S.J. & van de Velde, Didier & Mizutani, Fumitoshi & Uranishi, Shuji, 2014. "Structural reforms in the railways: Incentive misalignment and cost implications," Research in Transportation Economics, Elsevier, vol. 48(C), pages 16-23.
    3. Jin, Tuofu & Eapen, Alex, 2022. "‘Delayed Forbearance’: Multipoint contact and mutual forbearance in inaugural and subsequent competitive actions," Journal of Business Research, Elsevier, vol. 149(C), pages 938-953.
    4. Li, Xishu & Zuidwijk, Rob & de Koster, M.B.M, 2023. "Optimal competitive capacity strategies: Evidence from the container shipping market," Omega, Elsevier, vol. 115(C).
    5. Ndembe, Elvis & Bitzan, John D., 2022. "A shadow price approach examining service quality in a heavily captive U.S. freight transportation market: The case of grain transport," Transport Policy, Elsevier, vol. 116(C), pages 1-10.

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    Keywords

    Agribusiness; Marketing;

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