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north central Oklahoma | Although this doesn't look like the story that belongs with OT's title, here is what came up on the link.
Storage, shipping squeeze farmers
High harvest creates demand, price crisis
By Bartholomew Sullivan (Contact)
Saturday, September 8, 2007
WASHINGTON -- Ray Sneed of Millington, who is harvesting corn on both sides of the Tipton-Shelby line these days, says he's not "bad-mouthing" any companies, but he's none too happy about the price he's being charged by his grain elevators this year.
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The record harvest has made the demand for barges higher, and the demand has in turn raised the price, called the "basis," that elevators charge per bushel.
U.S. Rep. John Tanner, D-Tenn., wrote to Federal Trade Commission Chairman Deborah Plat Majoras on Friday asking for "an immediate evaluation of this situation to ensure that fair prices for transportation to market are being charged at grain elevators."
Tanner also talked by phone with Agriculture Secretary Mike Johanns about the situation, his press secretary, Randy Ford, said Friday.
"It appears to me that basis varies greatly between elevators, and I would like an explanation as to why this occurs," Tanner wrote in his letter to Majoras. "I am told by some granaries that because of the large amount of corn planted this year they are having to pay more for barges.
"In order for granaries to keep their margin of profit about the same, they are adding this cost onto the basis," Tanner added. "Therefore, this cost is coming directly from the producers' profit. However, if there are only a few granaries moving the majority of the commodities in the U.S., I don't see it getting any better for farmers. Unreasonably high basis costs that are unnegotiable are devastating to the farming community. Having suffered both drought and freeze in the South this year, my office has had to twice seek federal government relief."
Dennis Inman, a spokesman for Cargill, with facilities in Memphis, told The Commercial Appeal last week that the company is trying "to handle a phenomenal amount of growth in a short amount of time."
"The good news is that the harvest is huge and the weather is great for harvesting," Inman said. "The bad news is that we're trying to do it all in a compressed amount of time."
Said Sneed: "The demand is great so they charge more for it."
Washington correspondent Bartholomew Sullivan can be reached at (202) 408-2726.
Edited by Cowboycorn 9/8/2007 12:02
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CORRECTED: Tennessee Congressman calling for FTC to make "immediate evaluation" of grain basis issue
