Why Should Farmers Care About Transportation? …Because our international competitiveness depends on it.Costs of transporting soybeans: U.S. vs. Brazil (per metric ton; 4th quarter, 2011) Davenport, Iowa to Shanghai North Mato Grosso to Shanghai Truck - $10.22 Truck - $115.05 Barge - $28.91 --------- Ocean - $55.33 Ocean – $49.65 Total Transportation - $94.46 Total Transportation - $164.70 Farm Value - $425.00 Farm Value - $358.24 Cost to Customers - $519.46 Cost to Customer - $522.94 Trans. as % of Customer Cost – 18.18% Trans. as % of Customer Cost – 31.50% Source: USDA
Why Should Farmers Care About Waterways?…Because farmer profitability is impacted by it.
The Soy Transportation Coalition – Farmer funded& farmer led Established in 2007. Comprised of 11 state soybean councils, the United Soybean Board, American Soybean Association. National Grain & Feed Association & National Oilseed Processors: ex-officio members.
Panama Canal Expansion – Opportunity for increasedefficiency, or are we shifting the bottleneck? Pre Panama Canal Expansion (70 miles) Post Panama Canal Expansion (111 miles) Post Panama Canal Expansion (161 miles)
America’s Locks & Dams: A Ticking Time Bombfor Agriculture?Volume of Commodity Flows (2010) Illinois River Grain: 24 million tons (20%) Coal: 13 million tons (11%) Petroleum: 19 million tons (16%) Mississippi River Grain: 236 million tons (48%) Coal: 51 million tons (10%) Petroleum: 19 million tons (4%) Ohio River Grain: 49 million tons (5%) Coal: 614 million tons (59%) Petroleum: 58 million tons (6%)
America’s Locks & Dams: A Ticking Time Bombfor Agriculture? • Nation’s lock & dam inventory is underfunded • Current financing system guarantees cost overruns & poor stewardship (Olmstead, Monongahela, e.g.) • Gate failures – Markland Lock (September ‘09; Greenup Lock – February ‘10)
Is it time to ask some tough questions? Argument #1: How we allocate money is just as important as how much money we allocate. Argument #2: A predictably good inland waterway system is better than a hypothetically great one.