United Soybean Board: Deeper Channels to Deliver Larger Profits
The United Soybean Board’s (USB) commitment to improve market conditions for farmers hits a new bottom – the Mississippi River bottom, USB said in its latest announcement.
USB has approved funding to support environmental assessments (research) and education of this important improvement to the infrastructure system located near the Port of New Orleans.
“Every decision we make at USB is led by the driving interest in improving market opportunities for U.S. soy,” said Keith Tapp, USB Chair. “Our exploratory research on deepening the Mississippi River ship channel has the potential to improve global competitiveness and capabilities, which in turn makes it easier to deliver our product to customers and enhance farmer profitability.”
The project sets the foundation needed to improve the draft of the lower Mississippi River from 45 feet to 50 feet.
According to a report by the Soy Transportation Coalition, the change would increase the competitiveness of the leading export region for U.S. soybeans. The current depth of 45 feet on the lower Mississippi River is typically dredged to at least 47 feet to ensure the vessels do not hit the bottom of the riverbed.
The report concludes deepening the channel to 50 feet will allow a load increase from 66,000 metric tons to 78,000 metric tons, saving upward of $20 per metric ton when loading greater volumes onto one ship. The savings are expected to translate to a margin of 13 cents per bushel for barge river elevators exporting soybeans and increase revenues by $461 million.
USB is providing $2 million to help offset the research, education and promotion costs related to the project. The American Soybean Association, the Soy Transportation Coalition and several state soybean groups are also partnering to carry the project beyond USB’s initial investment.
The physical work to dredge the river would ultimately be paid by state (25%) and federal (75%) governments. Project work would begin after federal funding is secured.