The Port: Firing on all cylinders

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The Mighty Mississippi has had its share of recent problems, but despite high waters it will still ship around 500 million tons of cargo this year. All of it - coal, corn, soybeans, chemicals, timber, iron - is headed to the Port of New Orleans, America's gateway to global markets.

I had a chance to visit the port last week as a guest of the Soybean Transportation Coalition, formed by the American Soybean Association, seven state soy organizations, and the United Soybean Board (USB). It's a small group of farmers working to ensure that industry stakeholders maintain access to a transportation system that offers cost effective, reliable, and competitive service.

New Orleans has been a center for trade since 1718, when it was founded by the French. It's one reason Thomas Jefferson made the Louisiana Purchase in 1803. Jefferson felt uneasy about France and Spain having the power to block American trade access to the port.

Jefferson's head would be spinning if he could see this place in action now. More than 6,000 ocean vessels annually move through New Orleans on the river. The port's general cargo volume has averaged 11.2 million tons annually. Today, about 80% of world trade is carried by sea.

Many of the officials we spoke to said there were no lasting effects from Hurricane Katrina three years ago. In fact, they said most facilities were back in business within a week. The main problem was a lack of labor — many of the workers at the port had been displaced by the hurricane and ended up not coming back to work.

While this year's floods caused some delays in unloading barges, work still goes on with little economic impact.

Did you know? What surprised me most is that the port is not just a water facility. A lot of cargo that ships out through the Gulf also comes into the port from rail lines and trucking.

"With the ability to access six class A railroads directly onto the terminals, Interstate 10, and the availability to barge containers or bulk loads into the port, we're able to move from small to large quantities of cargo in any shape or

form,•bCrLf explains Kris Calkins (left), Deputy Office Manager at Mediterranean Shipping Company, a private shipping firm focused on containerized transport. MSC has 400 container vessels with 1.3 million TEU (twenty-foot equivalent) capacity.

"Be it in super sacks, bulk rail cars or bulk barges into containers, or bulk directly into vessels, the shippers are given different avenues in which to move their cargo,•bCrLf notes Calkins. "One of the challenges that the port faces is how to move this from rail car or bulk barges and load into containers, or into break bulk vessels.

"This can be easily overcome. Now a days, anything is possible in the transportation industry.•bCrLf 

Those containers Calkins talks about (pictured behind him) have grown in popularity in recent years. That popularity is largely due to the trade imbalance between the U.S. and Asia. Containers increasingly offer the scale and quality conditions many foreign customers want, and that includes specialty grain customers.

Infrastructure highlight The port is one of the best features of the U.S. grain transportation infrastructure. Unfortunately we're seeing other parts of this system begin to crumble, and little sign of the investment needed to stay competitive on a global scale.

Weak basis is the tell-tale sign of a transport system growing more inefficient by the day.

That's one of the main concerns of the Soybean Transportation Coalition. As Executive Director Mike Steenhoek says, the goal of STC is to make the journey from farm to dinner plate as efficient as possible. The value of a soybean on your farm is nothing until you factor in the cost of transport, processing and everything else needed before that oilseed feeds someone, here, or 5,000 miles away.

Today we have higher rail costs, higher fuel costs for trucks, and higher barge rates. Ocean freight rates are through the roof. Will higher transport costs damage grain exports?

If infrastructure costs continue to skyrocket, we will be pricing ourselves out of business.

Tomorrow I'll pass along comments from the chairman of the STC and give you his take from a farmer's standpoint.

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