The Economic Rents Of Bulk Commodity Transportation

Technological change is continually affecting the mining industry and the many papers being presented at this meeting reflect this fact. I fully agree that miners must remain fully cognizant of technology that can change mining costs and therefore your competitive marketplace. Despite the embrace of new technology and effective mine management techniques, the mining enterprise may not realize increased net income if the structure of the minerals marketplace is not understood. An important segment of the marketing structure for minerals is transportation. Transportation costs per ton can be much greater than the mining costs per ton and may accordingly overshadow hard earned gains in productivity. Change is greatly affecting the transportation industry but the change is driven more by governmental policy than technology. Although some technological advances are occurring in the bulk transportation business, the changes I want to address arise from policy. Policy changes have come from legislation in the 1970's culminating with the Staggers Act of 1980 and ensuing Interstate Commerce Commission decisions.