Wheat Freight Costs Rise as Plains Crop Shrinks

Southern Plains wheat shippers face higher rail fuel surcharges as hard red winter wheat production falls toward a nearly 70-year low.

NASHVILLE, TENN. (RFD NEWS) — Southern Plains wheat shippers face higher rail fuel surcharges as hard red winter wheat production falls toward a nearly 70-year low. USDA’s Grain Transportation Report says BNSF and Union Pacific made only modest tariff changes for the 2026/27 marketing year, but fuel costs are rising sharply.

The biggest change is the fuel surcharge. USDA says BNSF’s June surcharge will rise to 46 cents per mile, up from 8 cents last June. Union Pacific’s surcharge will rise to 69 cents per mile, up from 30 cents.

That increase can add real cost to wheat movement. For Wichita-to-Houston shipments, USDA says higher fuel surcharges mean a $251-per-car increase for Union Pacific and a $387-per-car increase for BNSF.

The higher freight cost comes as USDA forecasts hard red winter wheat production at 515 million bushels, down 36 percent from last year and the smallest crop since 1957/58. Drought and a late-season freeze drove the decline.

Large old-crop ending stocks may still support transportation demand, but lower production and higher freight costs will shape movement.

Farm-Level Takeaway: Wheat shippers may face higher rail costs even as drought sharply reduces Southern Plains production.
Tony St. James, RFD News Markets Specialist
Related Stories
Rising fertilizer costs tied to tariffs are tightening margins for U.S. wheat growers, according to new data from the National Association of Wheat Growers.
Rising costs are significantly extending walnut profitability timelines.
Consistent sorghum quality supports strong export demand potential.
Corn and sorghum exports remain strong; soybean demand lags.

Tony St. James joined the RFD-TV talent team in August 2024, bringing a wealth of experience and a fresh perspective to RFD-TV and Rural Radio Channel 147 Sirius XM. In addition to his role as Market Specialist (collaborating with Scott “The Cow Guy” Shellady to provide radio and TV audiences with the latest updates on ag commodity markets), he hosts “Rural America Live” and serves as talent for trade shows.

LATEST STORIES BY THIS AUTHOR:

Big oils-and-fats volumes can support crush demand, but fuel markets can quickly tighten supplies.
Mexican livestock officials are emphasizing surveillance and inspection systems to preserve access to the U.S. cattle export market. Texas’ Bovina Feeders explains the rising stakes as the border stays closed.
Nutrition policy shifts may influence retail demand across agriculture.
Weak crop margins and tariff uncertainty are delaying machinery purchases and signaling slower capital investment across U.S. agriculture.
Farm Bureau Economist Dr. Faith Parum explains the role farm safety net programs play in supporting farm finances as growers head into the 2026 planting season.
Corn demand is rising thanks to ethanol expansion, yet year-round E15 remains missing from the Farm Bill—leaving farmers questioning the policy gap.