USDA Report Highlights Importance Of Water Transport To Agriculture
The latest report by the United States Department of Agriculture’s Agricultural Marketing Service on the importance of waterborne transport to agriculture contains some surprising facts. The report, titled “A Reliable Waterway System Is Important to Agriculture,” was released in January and incorporates the latest updated figures.
To no one’s surprise, the New Orleans port region was listed as the top port for waterborne agricultural exports by a wide margin. The Mississippi River, Texas Gulf and East Gulf ports, in total, accounted for 55 percent —nearly 60.1 million metric tons (mmt) — of export grains. But the West Coast ports of Kalama and Tacoma in Washington were second and third for ag exports. Pacific Northwest ports accounted for 24 percent (25.9 mmt) of grains inspected and/or weighed for export in 2023.
Even more eye-opening is that in 2020, while more than 3 million tons of fertilizer were shipped northward along the Mississippi River System, more than 3.6 million tons moved along the Columbia River System. The USDA considers the entire western rivers, including the Mississippi, Arkansas, Illinois, Ohio and Tennessee rivers and the Gulf Intracoastal Waterway to be one single system, while the Columbia-Snake River System comprises the Columbia and Snake rivers.
Ag imports were spread more evenly around ports. New York was the leader, but closely followed by Philadelphia, Houston, Los Angeles, Savannah, Ga., and Long Beach, Calif., with the New Orleans port region coming in seventh.
The top ports for containerized exports were Los Angeles, Long Beach, Oakland, Norfolk and Savannah.
Ethanol
About 90 percent of ethanol is transported by train or truck, while the remaining 10 percent is transported by barge, but that figure alone doesn’t capture the importance of barging for ethanol production. Barges move much of the fertilizer needed to grow corn, used to produce feed, ethanol, and dried distillers’ grains (a high-protein ethanol refining byproduct used for animal feed). Corn is the largest user of nitrogen in terms of application rates per acre, total acres treated and total applications.
The USDA estimates that 87.1 million acres of corn will be harvested in marketing year 2023/24, producing 173 bushels per acre. This crop will be converted to products including ethanol, distillers’ grains, corn gluten feed, corn gluten meal and corn oil. A bushel of corn yields 2.7 gallons of ethanol and 17.5 pounds of distillers’ grain. U.S. ethanol production at 199 refineries is more than 17.9 billion gallons per year, of which more than 1.35 billion gallons were exported in calendar year 2022.
More than 325 million gallons of ethanol were moved by tanker and barge between the Petroleum Administration for Defense Districts (PADD) in calendar year 2022, from PADD 2 Midwest to PADD 3 Gulf Coast and from PADD 3 to PADD 1C Lower Atlantic. More than 11 mmt of dried distillers’ grains were exported in calendar year 2022.
Barges play an outsized role in the ag export market. USDA’s “Transportation of U.S. Grain, A Modal Share Analysis, 1978-2020 Update” shows that barges moved 46 percent of grain exports in 2020, and railroads moved 38 percent. By commodity, barges moved 53 percent of corn, 53 percent of soybeans and 28 percent of wheat destined for export in 2020. Railroads moved 34 percent of corn, 31 percent of soybeans and 53 percent of wheat to all export locations.
The report notes that while U.S. ag exporters are often unable to pass on to their overseas customers higher transport costs arising from lock closures, drought or floods, ag importers can and do pass on higher transport costs to U.S. consumers.
