Updated: March 21, 2017
The reliability and efficiency of the U.S. transportation system is a significant advantage for U.S. soybean farmers over their international competitors. However, global infrastructure investment is improving transportation efficiency in a way that could have a major economic impact. U.S. infrastructure requires improvements and modernization in order to maintain its competitive advantage, especially as global demand and domestic production continue to increase.
Why the Checkoff Cares
Improving infrastructure is a goal in the soy checkoff’s long-range strategic plan. Farmers rely on transportation infrastructure to get their soybeans to market cost-effectively. A reliable transportation system also lowers input costs for U.S. soybean farmers. International end users expect a reliable supply of high-quality soybeans that are delivered by the most efficient supply chain in the world. With competition between the United States and other top soy-producing countries intensifying, maintaining this differentiating factor is critical to build and maintain preference for U.S. soybeans. The majority of these locks and dams are over 50 years old and are in need of modernization.
- The U.S. transportation infrastructure is currently the best in the world. In order to maintain that competitive advantage, it requires modernization.
- Barge transport of soybeans provides the most economical, efficient and sustainable method of transportation for U.S. soy.
- The lock and dam infrastructure along the U.S. inland waterways needs attention. Investment is needed to maintain, rehabilitate and modernize the system.
- Investment in the system is critical to ensure U.S. soybean farmers can continue to move soybeans from areas of surplus to areas of deficit, which ensures domestic and international end users receive a steady supply of U.S. soybeans.
- International soy buyers often say that predictability of delivery is as important to them as price, so maintaining system reliability is important to meet end-user demand.
Facts & Figures
- The United States has 236 locks at 191 sites over 25,000 miles of commercially navigable inland waterways.
- 58 percent of U.S. soybean exports depart from the Mississippi Gulf region and 89 percent of those soybeans arrive to the region via barge.
- The U.S. has a competitive advantage in transportation costs compared to other top soy-producing countries. According to the Soy Transportation Coalition, total transportation costs for one metric ton of soybeans from Davenport, Iowa, to Shanghai, China, equals $61.66, compared to $96.94 for soybeans shipped from Brazil’s Port of Santos in the North Mato Grasso region to the same destination.
- A lengthy failure at a key lock and dam along the inland waterway system would result in tens of millions of dollars in lost revenue for U.S. farmers, according to the Soy Transportation Coalition.