Warren Buys Burlington Northern

Growing up on our wheat farm in Walla Walla County in Washington state, we had a small railroad trestle that went over Dry Creek behind our house.  The local train would come by in the morning headed to Dayton to pick up freight and then would head back to Walla Walla in the afternoon.  Most of the time there would be the engine, about five cars and the caboose.  The largest train I ever remember had about 17 cars.

This was a local branch of the Northern Pacific railroad which merged with two other railroads in the early 70’s to form Burlington Northern railroad.  I became a great fan of railroads at that time and the very first common stock whose price I followed each day was the Burlington Northern.

Today, November 3, 2009, Warren Buffett announced that his company, Berkshire Hathaway, would be acquiring Burlington Northern.  I think, as farmers, this may be a good deal since Warren’s company has financial horsepower to make any capital investments needed to keep the railroad in good operating shape.  A lot of grain in this country is moved by railroads and I believe that well capitalized railroads are very good for farming.  For example, almost all of the wheat grown in Montana is shipped by rail to the west coast to be exported.  Without well run railroads, the cost of shipping this grain would increase dramatically.