Grain fuel surcharge holds at 48 cents as US diesel hits record

In the United States, the North American weighted-average grain fuel surcharge held at $0.48 per railcar mile in September, while diesel reached a record $6.285 a gallon on 14 September.

How the two-month lag works

Most Class I railroads peg the grain fuel surcharge to the US average on-highway diesel price from two months earlier. The Agricultural Marketing Service set out that sequence in early July. Its reference price slipped from $5.60 a gallon for May to $5.02 for June. May set the July surcharge, while June set the August one. That drop explains why the weighted average fell from 61 cents in July to 48 cents in August.

For the week ending 7 September, the US average diesel price rose 36.8 cents to $5.967 a gallon, exceeding the previous record of $5.810 from 20 June 2022. The Energy Information Administration subsequently reported another increase of 31.8 cents, to $6.285 a gallon, for the week ending 14 September. However, neither weekly figure directly sets November’s surcharge: most formulas use a monthly diesel price with a two-month lag.

The fuel-surcharge record was set in July

September’s 48 cents is not the peak of this cycle. In July the weighted average reached 61 cents a mile. AMS logged that figure as an all-time high for its data series, above the previous peak of September 2008. The rate had gained 43 cents a mile since March. Diesel drove the climb after the US-Iranian conflict began at the end of February.

Since July the charge has eased. September now sits 13 cents below the summer high. It still stands 29 cents above the 19 cents charged in September 2025. Against the three-year average for the month, the gap is 28 cents. CSX also brought fuel surcharges back to its public tariff traffic in June. The carrier had not applied them to those rates since December 2021.

July marks the top of the cycle, and the two later months sit level with each other 13 cents lower. For comparison, the same figure stood at $0.14 per railcar mile in July 2025 and $0.19 in September 2025. Rates come from the fuel surcharge figure of the Agricultural Marketing Service, as published on 2 July 2026 and 10 September 2026. The average is weighted by each Class I railroad’s share of grain traffic in the previous year.

What the surcharge adds to a grain car

On selected unit-train and shuttle routes, the charge is a substantial addition to the published tariff. BNSF quoted $611 per car in September for soybeans moving from Argyle, Minnesota, to the Pacific Northwest. The underlying tariff on that move was $6,255. From Casselton, North Dakota, the same railroad quoted $592 on a tariff of $6,205. CPKC listed $1,075 per car for corn from Enderlin, North Dakota, to Kalama, Washington, against a tariff of $5,047. Union Pacific quoted $1,007 for corn from Mead, Nebraska, to Keyes, California.

The surcharge weighs far more heavily on some lanes than on others: it adds under a tenth to the two BNSF soybean moves and close to a fifth on the CPKC and Canadian National corn lanes. Share of the total is an editorial calculation, dividing the surcharge by tariff plus surcharge and rounding to one decimal place. Rates are those published for September 2026 by the Agricultural Marketing Service; they cover large covered hoppers and exclude secondary-market car costs.

Harvest brings other costs with it

Fuel is not the only charge on the move. Average secondary-market bids for September shuttle cars ran $742 above tariff in the week ending 3 September. That premium was $788 higher than a year earlier. Car supply has tightened in the northern Plains as well. Class I carriers reported 1,147 unfilled manifest grain car orders in North Dakota for the week ending 28 August. North Dakota had not passed 1,000 orders earlier this year. CPKC accounted for 692 of them and BNSF for 455.

Demand explains part of that backlog. The state’s spring wheat harvest was 86 percent complete on 6 September. Its five-year average for the date is 77 percent.

STB publishes quarterly carrier fuel reports

Class I railroads have filed quarterly reports of fuel costs, consumption and fuel-surcharge revenue since the fourth quarter of 2007. Under 49 CFR 1243.3, each report is due within 30 days after the end of the quarter. The Surface Transportation Board has posted second-quarter 2026 returns for BNSF, CPKC, CSX, Grand Trunk Corporation, Norfolk Southern and Union Pacific. Each filing reports total fuel costs and fuel-surcharge revenue billed for all traffic and for regulated traffic.

The Board is also considering Union Pacific’s proposed control of Norfolk Southern. It adopted a procedural schedule on 18 August and, in a decision dated 31 August, extended the deadline for Notices of Intent to Participate to 30 September 2026. The other deadlines remained unchanged.

What the fuel outlook implies

The Energy Information Administration expects diesel to average $5.07 a gallon across 2026, up from $3.66 in 2025 and 22 cents above its August forecast. EIA also expects Brent crude to average $91 a barrel for the year, about 32 percent above 2025, and approximately $89 in the third quarter. However, EIA finalised the forecast inputs on 3 September and says the outlook does not specifically account for subsequent market events. Because most grain fuel surcharges follow monthly diesel prices with a lag, later price changes may reach shippers only after the reference month.