November 30, 2021
United Soybean Board supports funding critical supply chain link on Mississippi River, US
United Soybean Board (USB), four qualified State Soybean Boards, Iowa Corn Promotion Board and the Soy Transportation Coalition propose funding key supply chain link on the Mississippi River in the United States.
To ensure continued and reliable delivery of US soybean exports to customers around the world, the soybean checkoff plans to fund pre-engineering and design work to enhance and maintain Lock and Dam #25 on the Upper Mississippi River, a US infrastructure asset critical for efficient barge traffic.
"The river system in the United States is our lifeline and one of US soy's biggest advantages over our competitors," said Meagan Kaiser, USB's farmer-leader. "It's vital that our supply chain remain strong and reliable so we can continue to market our products and provide the most sustainable, reliable nutrient source for our customers. Soybean farmers understand this, which is why the checkoff is working to modernise US infrastructure and return value back to the farm."
Together with the Soy Transportation Coalition, Illinois Soybean Association, Iowa Soybean Association, Minnesota Soybean Research and Promotion Council, Missouri Soybean Merchandising Council and Iowa Corn Promotion Board, USB is proposing a US$1 million investment to offset pre-engineering and design work expenses required to move the project forward.
If approved for federal funding, the project would be the first under the Navigation and Ecosystem Sustainability Program (NESP). NESP is a long-term program, authorised by the US Congress, to improve and restore the Upper Mississippi River System. Primary opportunities of improvement include reducing commercial traffic delays while restoring, protecting and enhancing the environment.
Lock and Dam #25 is one of seven existing locks specified by NESP for improvements. These existing locks, constructed in the 1930s, experience significant delays due to the single 600-foot lock chambers that raise and lower vessels moving from one water level to another. The 600-foot chambers require 1,200-foot barges to be disconnected and double-locked, significantly slowing delivery of US grain commodities.
According to a report prepared for the United States Department of Agriculture (USDA) Agricultural Marketing Service, Lock & Dam #25 accommodates 200 million bushels of soybeans annually.
The Waterways Council, Inc. states an outage at this facility would cost nearly US$1.6 billion and increase the number of truck traffic trips by more than 500,000 annually. Additionally, a 2016 economic impact analysis by USDA demonstrated this lock and dam's importance — predicting that even just a three-month shutdown (September-November) would result in aggregate economic activity related to grain barge transportation declining by US$933 million.
"Agricultural products comprise 70% of what we move through this part of the Mississippi River, so it's significant to US farmers and international customers that rely on this infrastructure to have our transportation corridor functioning," said Andy Schimpf, navigation business line manager with the US Army Corps of Engineers. "Barge transport via the lock and dam system provides the most economical, efficient and sustainable method of shipping US soybeans and other goods."
Lock and Dam #25 isn't the first critical infrastructure project taken on by the soy checkoff. In 2019, the checkoff invested in research, analysis and design to initiate dredging of the lower Mississippi River. That initial funding helped open the door to a US$245 million investment from the US federal government and the state of Louisiana to dredge the area from 45 feet to 50 feet. Once complete, the project is estimated to create an additional US$461 million value opportunity for US soybean farmers.
"Investments should never be regarded as a one-time activity," said Mike Steenhoek, executive director at Soy Transportation Coalition. "They must be perpetual. Infrastructure investments that soybean farmers have made in the past have positioned us for future success. We want to continue that level of investment, so US soybean farmers and their consumers continue to benefit."
- United Soybean Board