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Dean Campbell thought his co-op could moved pretty fast when it came time to load a barge with grain. But they're slowpokes compared to the flash of speed we saw during a visit with major grain exporters at the
"It amazes me that they can unload a fully-loaded barge in 45 minutes,bCrLf says Campbell, a grain farmer from Coulterville, Ill. "Those barges hold 50,000 bushels, so that's a pretty good turn time on volume of grain.bCrLf
Watching the big ocean-going vessels loading up on grain is a beautiful thing for any farmer. With the silent waters of the
On the other hand, shippers get bonuses of about half those amounts if they load vessels early and get them on their way.
"It behooves them to be on time,bCrLf grins
Basis study If only the rest of the grain transport industry worked the same way. Further up the transport pipeline, inefficiencies abound. Some is a result of a lack of competition, particularly among rail roads. Some of it may be due to a lack of investment, such as the 80-year-old lock and dam system on the river system. Those inefficiencies cause big gaps in basis.
"As a farmer I'm concerned with the lack of convergence between futures and cash prices,bCrLf says
As a past elevator operator, Campbell always counted on basis to behave in a more predictable manner throughout the year. During harvest it was always wider, and by mid season it got very close.
"We don't have that normality in the market to count on anymore,bCrLf he says. bCrLfIt makes it kind of frustrating to do marketing and count on the normal trends. It's a new risk farmers have to be aware of. It puts tremendous strain on the entire system, monetarily and mentally, for grain elevators and farmers.bCrLf
The goal of the basis study is to try to find out how much of the basis change is truly based on transportation inefficiencies, and how much is coming from other factors in the market. If the study reveals problems or lack of competition in the transportation area, farmers will be able to see how those problems impact their pocketbook in the form of lower grain prices. And they can take those issues to their political leaders.
Once farmers take up a cause, there's a good chance something positive will happen.
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