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Midwest lock failures pose far-reaching ripples

The economic ripples of Midwest lock failures would be felt well beyond the Heartland, accord to Soy Transportation Coalition (STC) Executive Director Mike Steenhoek.
Martin Ross 
Published: Feb 16, 2012
Steenhoek stresses the river navigation network is “a system the whole country really relies upon.” That reliance should only grow as the potential of the newly expanded Panama Canal comes to fruition, he told FarmWeek prior to an inland waterways symposium last week in Washington.
 
STC has attempted to document the river’s reach through a soy checkoff-funded Texas Transportation Institute study indicating key impacts for more than merely corn and soybean producers. The study, aimed at Washington lawmakers, considered the broad implications of “catastrophic” failures at Mississippi system locks.

In Steenhoek’s view, “it’s not a matter of if this ever happens -– it’s a matter of when it happens,” given the condition of outdated Midwest locks.

“The study examined what the impact would be not only for producer income, but also on the ultimate cost for our customers, domestically,” he noted. “If you have a failure at any number of these locks, you’d see some of the livestock operations in the southeast and the southwest parts of the United States be adversely impacted.

“These areas are far removed from our inland waterway system. The stakeholder group is larger than many people realize, and this study provides an opportunity to convey that message to policymakers who represent those districts.”

Further, expansion of the Panama Canal (slated for completion by 2014) will provide Gulf access for massive “Panamax” vessels with far greater commodity loading capacity. By some estimates, those vessels could accommodate an added 13,000 metric tons or 700,000 bushels of soybeans.

A recent checkoff-funded report concluded that would generate a increased “draw” of export grain from points further removed from river terminals. That study suggests the soybean draw area could expand from 70 miles of major river ports to at least 160 miles, and National Corn Growers Association policy specialist Elizabeth Jones agrees the canal’s expansion has “reemphasized just how important our lock and river system is” to corn export markets.

That likely would result in more competitive rail freight rates throughout the Corn Belt, as well, Steenhoek said. But all that will happen only if Mississippi system locks can accommodate greater volumes.

“Updating those locks and making them current for larger barge (tows) only becomes more and more important,” Jones told FarmWeek.

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