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8/20/2012


Rail News: Rail Industry Trends
Transportation choke points could threaten global competitiveness of U.S. soybeans, USB study shows



The United Soybean Board (USB) recently released a study on the U.S. transportation system that identifies several choke points where problems could arise as crop production and global demand increases for soybeans.

Titled “Farm to Market – A Soybean’s Journey,” the study determined that transportation reliability and efficiency will be taxed as soybean production and global demand rises, threatening the agricultural product's ability to remain competitive on a worldwide scale.

Moves from a farm to soy processing plant or port requires U.S. soybeans to be handled 2.4 times and travel an average distance of 716 miles, amounting to 71 billion ton-miles, USB officials said in a study summary.

The U.S. inland waterway system remains a “precarious leg” of soybean transportation in part because of a deteriorating lock system and dredging needs, the study states. In addition, the nation’s rail network “has been feeling pressure” as more soybeans make their way to China, USB officials said. The rail industry has registered a traffic increase from the western soybean belt to the Pacific Northwest.

The study predicts that China’s demand for U.S. soybeans will continue to grow, perhaps doubling by 2020-21.

“If realized, this increase could expand rail carloads of soybeans by 36 percent,” USB officials said.

Overall, U.S. rails, waterways and highways require upgrades to help maintain soybeans' global competitiveness, the study states. Transportation infrastructure investments could save the U.S. soybean and grain industries about $145.9 million annually, generated by reduced delays, more efficient travel and other ag product transit improvements, the board estimates.

“USB has made increasing public and private investment in soy transportation modes a priority issue in its long-range strategic plan, board members said.

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