Soy Transportation CoalitionMoving Iowa Forward Conference

April 24, 2012

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 increased efficiency, 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 Bomb for 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 Bomb for Agriculture?

Cost to Agricultural Producers of Lock Closures

($ millions):Lock 2 Weeks 1 Month 3 Months 1

Year

LaGrange $2.7 $4.8 $21.2 $30.4

Lock 20 $2.8 $4.9 $15.4 $44

Lock 25 $2.8 $4.9 $15.4 $44.1

Markland $0.89 $1.02 $3.8 $4.9

Lock 52 $2.9 $3.1 $11.9 $13.9

America’s Locks & Dams: A Ticking Time Bomb for 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.

Thank YouSoy Transportation Coalition

1255 SW Prairie Trail Parkway

Ankeny, Iowa 50023

515-727-0665

515-251-8657 (fax)

www.soytransportation.org

Mike Steenhoek, Executive Director

msteenhoek@soytransportation.org