Shipping via Semo Port keeps ag industry buoyant

A world demanding more exports of agriculture commodities means busier times for the place in Southeast Missouri charged with shipping out and bringing in products necessary for large-scale crop production.

In 2014, the Southeast Missouri Regional Port Authority handled 1.3 million tons of cargo, a record-setting amount consisting of 70 percent agricultural sector products, says port executive director Dan Overbey.

More products passing through the port can be correlated with an increase in Missouri-made and -grown exports overall and a stronger demand from international markets for some grains as reported by government agencies that monitor commerce and trade.

The types of agricultural products shipped through the port using river barges, rail cars and trucks include corn, soybeans, wheat and milo, or grain sorghum. Fertilizers include ammonium nitrate, diammonium phosphate, potash, urea and others. Together, grains and fertilizers represent about half of the port's total annual tonnage. Products from a corn mill and a wood chip mill at the port make up the remainder of the agriculture haul.

Access to river transportation, along with storage for hundreds of thousands of bushels of grain and millions of gallons of fertilizer, is taken care of by the port and several businesses based there.

Southeast Missouri Regional Port Authority June 8, 2015. (Fred Lynch)

Barges that travel the Mississippi River are the primary method of moving agricultural products from Southeast Missouri, mostly because of the cost-effectiveness the shipping method provides for the parties who pay to get products to market destinations.

Transportation by river for the soybean industry is nearly a must for Missouri farmers, who grew more than 250 million bushels in 2014, according to data from the Missouri Soybean Association, and Southeast Missouri is the region of the state where soybeans are most harvested.

"In terms of transportation costs, barge rates can be less than half the cost of rail and 90 percent or more lower than truck rates, depending on demand and conditions," said Christine Tew, spokesperson for the association, in an email. "Growers near river terminals or who sell their soybeans at river terminals often see those transportation price differences reflected in prices they receive."

A typically-sized 15-barge tow can carry up to 855,000 bushels, Tew said, and barges can move one ton of soybeans 616 miles on one gallon of fuel.

Soybeans are Missouri's largest export, and about 24 percent of the state's soybeans are transported to their first market point by rail, Tew said. Twenty percent are moved to the first market point by barge and 55 percent are moved by truck. Most of the total amount of soybeans that will be exported then travel Mississippi and Missouri rivers by barge.

Nationwide, more than half of the United States' soybeans also pass through Mississippi River ports en route to export, Tew said.

The state's soybean crop last year generated $2.5 billion in cash receipts and $4.2 billion in total economic impact, according to the University of Missouri's commercial agriculture program.

Soy exports from throughout the country, estimates the U.S. Soybean Export Council, also are valued at more than $8 billion per year, with exports of soybean meal growing faster than domestic consumption.

Overbey says the port's importance to the health of the local agriculture industry can vary year by year when considering transportation costs are dependent on river conditions, but overall, using the port and the river is consistently found to be the cheapest way to send grain and other products.

An end to a project to expand the Panama Canal in 2016 could cause the port to see more cargo move through, as an increase in Mississippi River traffic overall is expected, though Overbey says more likely to keep increasing business at the port is the pending open access to long-embargoed Cuban grain markets.

Missouri is the fourth-largest producer of rice in the country, and rice industry representatives are involved in a push to open the U.S.-Cuba market because of potentially high business value.

Transportation of soybeans by rail and barge are also expected to expand by 36 percent and 43 percent between 2010 and 2020, according to a report prepared in 2012 for the U.S. Soybean Export Council.