The soybean industry has devoted much time to growing soybeans, boosting yields, building markets and finding new uses for soybeans. But getting the soybeans from elevator to end-user efficiently is also a critical part of the process.
The Soybean Transportation Coalition was formed in 2007 to address the transportation issues critical to future soybean profitability. The Coalition includes seven Midwest state soybean councils, the United Soybean Board and the American Soybean Association. Mike Steenhoek is the executive director.
The coalition this summer sponsored a field trip to the Omaha and Council Bluffs area to familiarize board members and the media with some industry transportation issues.
At Union Pacific headquarters, the group learned that most elevators requesting cars are currently receiving them more or less on schedule because the economic downturn means that there are fewer goods on the move, including autos and building materials. As a result, U.P. has furloughed more than 5,000 employees, mothballed more than 1,000 locomotives and sidelined 60,000 railcars until they are needed.
Union Pacific spokesmen said that they have boosted the energy efficiency of its rail system 85% over the last 25 years. An U.P. engine can haul a ton of freight 457 miles on a gallon of diesel fuel.
A barge can move a ton of freight even further on a gallon of diesel fuel. The Missouri River is open for barge business, said John LaRandeau of the Army Corps of Engineers, after several years when low water levels reduced shipping opportunities on the river. However, in the interim, all but one towing company has quit regular service on the Missouri, at least north of Kansas City, Mo.
Other company's barges enter the river occasionally.
The Army Corps of Engineers is anticipating some high-value shipping on the Nebraska stretch of the river because equipment for the Novozymes enzymes plant being built at Blair will be brought in by barge. But LaRandeau doesn't foresee a big surge in Missouri River shipping unless there is a drastic tilt in the economic forces shaping river shipping.
The cost of transportation is vital to soybean growers, according to Steenhoek, because the more customers and middlemen have to pay for transportation, the less they will pay farmers for their soybeans.
"They don't charge their customers more. They pay farmers less. So farmers are paying the freight bill. Shippers want farmers involved in transportation and infrastructure issues," he says.
Mike Korth of Randolph, who took part in the tour, said if railroads have thousands of hopper cars going no where, it seems like the railroads could be offering shippers some better deals to stimulate business.
Korth added that a revival of the barge business in the state could benefit farmers two ways: Bringing fertilizer up the river and taking ag commodities back down river.
Everyone takes shipping for granted, but it needs to remain an item of attention, and transportation improvements must continue to be made, or agriculture interests will suffer.
Norman Husa of Barneston says he doesn't think that barge shipping has much viability in Nebraska. For Nebraska farmers, it's increasing the speed and efficiency of the railroads, and improving highway infrastructure for truck traffic.