Containerized shipping of ag products on the rise
A huge new 275-acre rail yard has been established on the outskirts of Decatur, Ill. Archer Daniels Midland (ADM) opened the facility this year to handle container shipping of commodity grain.
The main discussion about shipping grain for export is by river barge or bulk rail cars to ocean ports where the grain is then loaded into large ships. But the newer alternative is to load 40-foot-long containers, those that have been used to ship cargo to the U.S. from overseas, with grain and ship the grain in a kind of backhaul to ports around the world.
Even though this modular transportation or container shipping has been done for about three decades, the 275-acre rail yard shows how this type of shipping is increasing and/or being promoted more than in the past. ADM notes that as of today about 90 percent of the U.S. export grain is still sent in bulk in large vessels. ADM’s new Decatur facility can handle 50,000 containers annually, according to company sources, but the company has plans to triple its capacity in the future.
Container shipping allows buyers to receive smaller shipments, which is helpful during a sluggish global economy and for trade with countries without the infrastructure to receive large deliveries. Container shipping can open up new markets for U.S. farmers.
Peter Friedmann with the Agriculture Transportation Coalition was the source of information about container shipping in a website posting by Harvest Public Media. Freidmann says, there’s an expanding niche of specialized grain products, grown in the Midwest and wanted overseas, which adds to the potential for container shipping.
“If you want to deliver to a foreign customer a product that has been well taken care of, not crushed in the bottom of the hold of a ship, you need to have it in smaller quantities,” Friedmann is quoted as saying. “Some people want it genetically modified, some people do not want it genetically modified. Some want this kind of soybean, another one (wants) another strain of soybean. So you can segregate the types of cargo that you are shipping out by moving it into container.”
Examples he suggested range from the corn remnants of ethanol plants for animal feed, to a small shipment of grain that will go directly to a bakery in Korea, to soybeans that will be used to make tofu.
The Harvest Public Media article notes that farmers in Illinois, Missouri and Kansas are among those leading the nation in the container shipping of their crop production. They benefit because Chicago and Kansas City serve as major rail hubs, making more empty containers available.
Container shipping can be seen as “niche shipping.” It allows for small shipments by private entrepreneurial companies to and from the U.S. Friedmann is quoted as referring to them as “micro-businesses.”
Because individual companies can fill a container, not a whole ship, they have the opportunity to ship their specialized production and have more control over marketing internationally.