Such delays are worsening on the nation’s waterways, which are critical to commerce for the United States, the largest grain exporter in the world. Of the country’s $40 billion in annual grain and soybean exports, about 60 per cent is moved by barges on rivers, including the Ohio.

The shutdown, caused by worn or missing sections of a dam, snarled traffic from early September into early November through Locks and Dam No. 52 near Paducah, Kentucky. It was the second shutdown in two months at No. 52, which is among the country’s busiest locks with about $22 billion (all figures U.S. funds) a year of commodities flowing through it.

The lock, which has been earmarked for replacement by the Army Corps of Engineers for three decades, is one of many choke points along 25,000 miles of waterways used to transport everything from grains to consumer goods to coal.

It is a system increasingly under strain. Surging shipments of soybeans and corn — due to record harvests — are overwhelming parts of the antiquated network and causing more frequent and severe backups, according to interviews with farmers, shippers, grains merchants and barge operators.

Reverberations have cut across the U.S. agricultural supply chain — and international markets. This fall, delays in moving crops downriver bumped up grain prices at export terminals along the Gulf Coast, opening up an advantage for global competitors such as Brazil.

Most of the country’s 239 locks have exceeded their half-century design lives, and nearly half the vessels that use the nation’s inland waterways now experience delays, according to the American Society of Civil Engineers.

The average delay per lock has nearly doubled on the waterways since the beginning of the century, rising to 121 minutes in 2014 from 64 minutes in 2000, the group said.

An October National Waterways Foundation study said a major lock failure in the Midwest could cost shippers $1.5 billion per year in added costs and overwhelm existing rail and road capacity. Every barge can hold as much grain as 16 rail cars or 70 trucks.

Swollen stocks

The delays here and elsewhere are boosting prices for key goods including soybeans, and eating away at the nation’s competitive edge against rival exporters like Brazil.

U.S. soybean export prices normally drop in the autumn, as newly harvested supplies flood the market. But the delays caused prices to rise, making it harder for the United States, the second-largest soybean exporter, to compete with Brazil, which ranks first.

In mid-August, the price of soybeans loaded for export at U.S. Gulf Coast terminals was about $14 per metric ton below the cost of soybeans loaded at Brazil’s Paranagua port, according to industry data. By mid-November, the U.S. advantage had been cut to less than $4 per ton. Brazil’s soybeans have a higher protein content, and therefore attract a premium.

Top soy importer China is expected to buy twice as many soybeans from Brazil in the fourth quarter as it did last year, much of it at the expense of U.S. shipments.

Export markets are key for farmers and grain processors due to rising crop yields. In the past two decades, U.S. corn output has outpaced domestic use by 20 per cent, and soybeans by more than 70 per cent.

“Being near the river used to be an advantage, but now having to wait on dams and infrastructure is more of a liability to farmers,” said Marc Bremer, a farmer in Metropolis, Illinois.

Bremer sells most of his corn and soybeans to facilities known as elevators, which receive and store grain and load barges on the Ohio River. This autumn, he lost up to $30,000 in revenue when prices tumbled because disruptions caused crop stockpiles to swell at these facilities. He said he may delay buying new farm equipment as a result.

The log-jams hit local grain buyers — the elevators — that cut bids on crops to the lowest levels since the Port of New Orleans was shuttered by Hurricane Katrina in 2005.

Elevators, including those owned by Bunge, Cargill and Archer Daniels Midland, typically fill barges with corn and soybeans en route to the Gulf of Mexico. But the backup meant they were unable to ship out supplies — overwhelming their storage, too.

‘Hidden cost’

Along the river in Shawneetown, Illinois, Bunge piled soybeans outside on the ground, putting them at risk of damage from rain or animals, because the elevator’s bins were full due to the backlog, local farmers said. An employee of Bunge’s elevator said it took this step because of “market conditions.”

Randy Anderson, a farmer from Galatia, Illinois, said he was told to hold back pre-arranged deliveries of crops to the Bunge elevator. Instead, he was forced to take time away from harvesting to load the crops into his own storage bins.

“That could have been time I could have been in the field,” he said. “That’s a hidden cost.”

The effect was also felt by shipping companies, which make more money the more trips their barges make. Barge operator Campbell Transportation Company of Pittsburgh estimated a loss of $1 million in revenue in September and October because of the delays.

“This was the difference between a small profit and a big loss,” said Peter Stephaich, Campbell chief executive.

Replacing Locks and Dam No. 52 and nearby No. 53 on the Ohio River has been on the U.S. Army Corps of Engineers’ to-do list for about 30 years, even as its backlog of other projects has grown.

Known as the Olmsted Locks and Dam, the replacement is set to finally be completed next year. Its cost has risen to about $3 billion from an original estimate of $775 million.

In the meantime, the short-term work to fix the dam continues. Divers working in pitch-black water needed a week to repair the largest hole in the 90-year-old dam, one of the last on the river made of wooden slats. Repairs to three other worn and corroded sections may be completed this month. For the seven-man crew of the Oliver C. Shearer, one of 70 towboats hauling hundreds of barges carrying goods, the delay at Locks and Dam No. 52 meant killing time. But there was only so much paperwork, repairs, or waxing the checkerboard floor of the vessel that the crew could do.

“You start beating your head against the wall,” Michael McCloud, the boat’s captain, said in October as he looked out at idle barges on the Ohio River from the vessel’s bridge.

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Free trade has remained a key, philosophical driver for U.S. feed grains for decades, benefiting corn, barley and sorghum growers — among many other commodities. Now, agriculture must answer the call to defend trade and the rewards reaped from free trade-driven policies.

Simply put: When trade works, everyone wins. Exports of feed grains in all forms to the 20 countries with which the United States has a free trade agreement have increased by nearly 24 per cent over the last 10 marketing years, according to U.S. Department of Agriculture (USDA) trade data.

Free trade agreement partners now represent 49 per cent of total U.S. exports of feed grains in all forms.

In no other case has the benefit of open trade been more apparent than in our relationship with Canada and Mexico through the North American Free Trade Agreement (NAFTA).

NAFTA provided the trade policy underpinnings that resulted in the most efficient and effective interregional grain and livestock value chain in the world.

The provisions in NAFTA complement the natural geographic advantages of close proximity. As a result, agricultural trade between the United States, Canada and Mexico occur duty free, and trade has grown increasingly more integrated.

Mexico was the largest export market for U.S. corn in the last full marketing year, purchasing 13.3 million tons (524.4 million bushels), in addition to 606,127 tons (23.86 million bushels) of sorghum, 115,000 tons (5.3 million bushels) of barley and 1.9 million tons of distillers dried grains with solubles (DDGS).

Our trade agreements have also been a good deal for our trading partners who have invested significantly in expanding their own feed, livestock and transportation industries while relying on the U.S. coarse grains industry.

This cycle of increasing sales and then expanding operations results in even more demand for U.S. feed grains and co-products. And as existing end-users advance to more sophisticated buyers, the council can expand efforts to assist underdeveloped sectors like conducting DDGS trials with livestock producers in northeastern Mexico. This overall effect is a win-win scenario on both sides of the border.

At the same time, the basic tenets of free trade are now up for debate in the United States. The upheaval of this philosophy is forcing U.S. agriculture into a defensive mode. We all must engage to help achieve conclusions in our trade negotiations that provide us and our customer’s long-term certainty and create a new platform for growth and integration.

Of course, modernizing or examining the provisions within trade agreements is good business. But we must recognize agriculture is a traditional target for retaliation in trade disruptions, a clear and present danger. “Do no harm” for U.S. feed grains and co-products means avoiding these retaliatory measures at all costs.

As a result, members of the grain and feed industries must monitor trade policy negotiations in any sector with a careful eye. Farmers, members of the agriculture supply chain and negotiators alike must understand how important our markets — and trade — are to agriculture’s profitability.

While we defend and demonstrate the mutually beneficial trading relationships we have built to domestic audiences, our competitors are making their own good deals and eroding our competitive advantages.

Our largest and most loyal customers are at risk of taking their business elsewhere.

We are no longer the only option for world grain demand. As a result, it is up to all of us in U.S. agriculture to make sure trade liberalization continues at all levels, lest we no longer will be the ones in the race, let alone winning.

We in agriculture cannot afford to stay humble, silent observers. All of us are needed to send a strong message to our customers and our competitors that the United States is in the global marketplace to stay.

The U.S. grains sector has significantly benefited from more liberalized trade in the past 30 years, and expanding access to export markets will continue to drive the success of American agriculture for years to come.

Tom Sleight is president and chief executive officer (CEO) of the U.S. Grains Council.

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Francois Labelle, general manager for the Manitoba Pulse and Soybean Growers, said most grain being harvested is several percentage points above safe storage since the dry spell broke.

“The beans aren’t drying down and we haven’t had much drying weather, so there seems to be more concern about that,” he said. “Even compared to last year when we actually had a fairly wet fall, most of the beans seemed to have come off on a better moisture condition last year.”

The situation has left some farmers in limbo, wondering whether it would be best to hold off on harvest or bring it in to dry in the yard.

It’s a target that Dr. Digvir Jayas, a Distinguished Professor at the University of Manitoba and former Canada Research Chair in Stored-Grain Ecosystems, said might be difficult to pin down.

• Read more: How to avoid grain drying errors

Leaving the crop in the field might be beneficial, he said, but only if the farmer could be assured of good drying conditions for the next week to 10 days.

“But we don’t know if that’ll be the case,” he said. “I think it would depend more on what is the possible weather forecast because, with the cool temperature, really, there is not much drying happening in the field.”

Cool air has a low drying capacity, he said, although plant matter may warm if the sun is shining and speed drying.

“Better would be is if they had the capability to dry the grain,” he said. “I would bring it in and then dry it using ambient air — hopefully the moisture is close enough to the safest storing (level) that they can dry using ambient air — or dry using low temperature,” he said, noting that high-temperature drying is a particular challenge in soybeans.

Drying pulses quickly at high temperatures may cause seed to crack, the Canadian Grain Commission warns.

Farmers should also weigh the risks when deciding if ambient air drying will be enough, Joy Agnew, Agricultural Research Services project manager with the Prairie Agriculture Machinery Institute, said. Fan capacity, grain moisture and weather should all be taken into account.

“There’s a lot of factors that play a role,” she said. “The really rough rule of thumb for this time of year is if it’s more than two or three per cent above dry, consider a hotter dryer or consider supplemental heating with a natural air drying system.”

The Manitoba Pulse and Soybean Growers is urging producers to monitor tough crops even after drying and to prioritize wetter crops when monitoring in the bin.

“In their marking they should be making sure they talk to their buyers as well about higher-moisture beans, whether they’re accepting them or not,” Labelle said.

Dramatic switch

Pulse growers’ concerns are echoed in the few canola acres left to harvest.

Unharvested acres are largely in southwest Manitoba west of Highway 10, according to Angela Brackenreed, agronomy specialist with the Canola Council of Canada.

“It’s a challenging time of year to harvest, because days are a lot shorter,” she said. “There tends to be a heavier dew, so it takes some time to be able to get started at the beginning of the day and then that day is cut short when the sun goes down and conditions get challenging.”

Some extra moisture might actually be good news for remaining canola, which has seen an abnormally dry growing season, she added.

Earlier harvest was “unprecedentedly dry” when it reached the bin and moisture reportedly hit four or five per cent on a regular basis, Brackenreed said.

In a crop where moisture can reach 10 per cent at delivery, those levels raised worry over lost weight and yield and cracked grain at harvest.

“It was a fairly strange fall early on where it was very, very dry and quite warm, so we had really rapid dry-down of the seed and plant material,” Brackenreed said. “I think it caught people by surprise a little bit. Not to say that nobody started at higher moistures of eight, 10 per cent, but it dropped really quick.”

Pulse growers, likewise, have fought both sides of the spectrum this year, with extremely dry conditions prior to the September rains.

“I know the seed growers and so on would be concerned about that because it could have an effect on germination,” Labelle said.

Cereals OK

The dry conditions posed no threat to the cereal harvest, Pam de Rocquigny, general manager for the Manitoba Wheat and Barley Growers, said.

“In terms of wheat and barley, I think a lot of producers have their crop in the bin, so obviously at this point we definitely encourage them to keep an eye on it throughout the winter in terms of making sure what they’ve put in the bin is going to maintain its quality,” she said.

Corn, however, is expected to fight wet conditions.

De Rocquigny, also general manager for the Manitoba Corn Growers Association, said corn is sitting at between 20 to 30 per cent moisture, although harvest has not begun in earnest.

“Corn never dries down to safe storage moisture levels out in the field, so it typically requires artificial drying to get it to those safe storage moisture levels,” she said.

The Manitoba Corn Growers ranges dry-down in October between 0.5 and 0.75 per cent per day, depending on weather, down from 0.75 to one per cent the month before. By late October, the group expects dry-down to drop below 0.33 per cent per day.

The post Formerly parched grain now fighting moisture after September rains appeared first on Manitoba Co-operator.

“Field losses, splits and cracked seed coats increase as moisture content decreases,” he says. “Shatter losses have been shown to increase significantly when seed moisture falls below 11 per cent or when mature beans undergo multiple wetting and drying cycles.”

Because harvest losses increase dramatically when the moisture content is below 11 per cent, harvesting during high humidity such as early morning or late evening or damp conditions may reduce shatter loss, Hellevang notes.

Many times, the discount for delivering beans with a moisture content in excess of 13 per cent may be less than the discount for shatter losses from harvesting overly dry soybeans. He recommends that producers begin harvesting at 14 or 15 per cent moisture to reduce the amount harvested below 11 per cent.

Moisture content can increase by several points with an overnight dew or it can decrease by several points during a day with low humidity and windy conditions. Avoid harvesting when beans are driest, such as afternoons, to maintain moisture and reduce shattering losses.

Changing colour

“Unfortunately, there has not been adequate research examining if immature green soybeans will change colour in storage,” Hellevang says. “Limited studies indicate that green soybeans will tend to stay green in storage. They do not lose their internal green colour caused by chlorophyll, although the surface colour may lighten or mottle somewhat after weeks or months in storage.”

Field losses need to be balanced against the discounts for green seeds in determining when to harvest. Another possibility is harvesting some of the field and leaving the portion with the green soybeans unharvested, he says.

Equalizing moisture content

Soybean moisture variation may lead to storage and marketing losses. Operating an aeration fan will help move moisture from wet beans to drier beans. Air going past wet beans picks up moisture, and that moisture will transfer to drier beans as the air goes past them.

Moisture movement will be minimal without aeration airflow. Hellevang suggests initially running the fan longer than is required to cool the grain to even out the moisture content. The moisture will not be all the same, but it should become more uniform.

Soybeans at 11 per cent moisture have similar storage characteristics as wheat or corn at 13.5 to 14 per cent moisture, so an allowable storage time (AST) chart for cereal grains can be used to estimate allowable storage times for soybeans.

For example, soybeans at 16 per cent moisture content would be similar to cereal grains at about 19 per cent moisture, so soybeans would be expected to have an AST of about 70 days at 50°. The AST is reduced to 35 days at 60° and extended to about 140 days at 40°.

Drying options

The recommended maximum moisture content for air-drying is about 16 per cent moisture, with an airflow rate of at least one cubic foot per minute per bushel (cfm/bu.) during October. The amount of natural-air drying that will occur in late October and November is limited in northern states.

The equilibrium moisture content of soybeans for air-drying at 40 F (4.5 C) and 70 per cent relative humidity is 13.7 per cent, but even with an airflow rate of one cfm/bu., drying soybeans with 16 per cent moisture will take about 70 days. Adding supplemental heat to raise the air temperature by 5 F (2.4 C) will permit drying the soybeans to about 11 per cent moisture in about 55 days.

Only about one-half of the beans would be expected to dry by mid-November, when outdoor temperatures become too cold to dry efficiently. Adding heat would cause the beans on the bottom of the bin to be dried to a lower moisture content and it would increase drying speed only slightly. Cool the soybeans to between 20 and 30° for winter storage and complete drying in the spring. Hellevang recommends starting to dry when outdoor temperatures are averaging about 40°.

Increasing the airflow rate will increase the drying speed. However, the fan horsepower required to achieve the higher airflow rate becomes excessive unless the grain depth is very shallow.

For a soybean depth of 22 feet, the rule of thumb is that each 1,000 bushels of soybeans will need about one horsepower of fan to achieve an airflow rate of one cfm/bu. Achieving an airflow rate of 1.5 cfm/bu. will require about 2-1/2 horsepower per 1,000 bushels, and an airflow rate of two cfm/bu. will need about five horsepower per 1,000 bushels.

The type of fan greatly affects the airflow provided per horsepower, so use a fan selection software program such as the one developed by the University of Minnesota. It is available on the NDSU grain drying and storage website (https://www.ag.ndsu.edu/graindrying).

Soybeans can be dried in a high-temperature dryer, but the temperature needs to be limited to minimize damage to the beans. Refer to the manufacturer’s recommendations for maximum drying temperature. Typically, the maximum drying temperature for non-food soybeans is about 130 F (54.5 C). Even at that temperature, some skins and beans will be cracked.

One study found that with a dryer temperature of 130 F (54.5 C), 50 to 90 per cent of the skins were cracked and 20 to 70 per cent of the beans were cracked. Another study found that 30 per cent of the seed coats were cracked if the drying air relative humidity was 30 per cent, and 50 per cent of the skins and about eight per cent of the beans were cracked at 20 per cent relative humidity.

The relative humidity is reduced by one-half for each 20° that the air is warmed. Therefore, if air at 40 F (4.5 F) and 80 per cent relative humidity is warmed to 60°, the relative humidity is reduced to 40 per cent, and if it is heated to 80°, the relative humidity is reduced to 20 per cent. Monitor the amount of damage occurring during drying and regulate the temperature to obtain the acceptable amount of damage.

Most dryer fires occur due to trash accumulating in the dryer. Monitor the grain flow in the dryer and periodically clean the dryer to reduce the potential for a fire.

Food soybeans and seed beans must not have damage to the seed coat, so natural-air or low-temperature drying is the preferred drying method, Hellevang says.

For more information, do an internet search for NDSU soybean drying.

The post Avoid soybean loss during harvest, drying and storage appeared first on Manitoba Co-operator.

In an interview with Manitoba Co-operator editor Laura Rance at Ag in Motion in Saskatoon, DuPont Pioneer vice-president Neal Gutterson discusses plans for breeding corn and soybean varieties that can be grown across Western Canada, as well as for hybrid wheat and use of biologicals for insect and disease control.

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Questions over domestic production potential coupled with delays to export shipments expected out of Ukraine have helped underpin domestic Chinese grain prices, even as U.S. prices have been dragged lower by the ongoing harvest.

This helped widen the price spread between Chinese and U.S. values by more than 10 per cent since the start of November, and could well spur Chinese grain importers to look to U.S. shipments as a way to plug supply gaps until their own production makes it to market around the end of the year.

Even though China is the second-largest corn grower globally and is projected to pull in roughly 210 million tonnes of the grain this year, steady advances in industrial demand for the crop have helped sustain domestic corn prices some $150 per tonne or 40 per cent above U.S. export values for the past several months.

This price spread marks an advance over last year’s $115-$120 differential — which triggered China’s largest-ever corn import purchasing campaign last summer.

The country has already booked around 4.73 million tons of imports from the U.S. this crop year (Sept. 1 to Aug. 31), and since January has shipped in more than 1.6 million tons of the grain from the U.S., Argentina and elsewhere.

But statements from government officials stress that any additional import purchases are unlikely, as the country intends to remain self-sufficient with regard to its corn requirements.

Further, the country struck a deal with Ukraine to secure a total of four million tons of corn over the course of 2013 and 2014 as part of a $1.5-billion loan agreement that is tied to infrastructure investments in Ukraine and elsewhere in the Black Sea region.

However, bursts of heavy rains in the southern Ukraine Corn Belt delayed the harvest by several weeks, and so pushed deliveries of the grain to China to much later in the year than anticipated.

This has left Chinese grain handlers in a bind, as robust domestic demand has depleted interior inventories and fanned food and feed price inflation in many areas.

Concerns over the country’s own production prospects following localized floods and drought have prompted further concern, and set the stage for a potential late-year incursion by Chinese import traders on to the global corn export stage.

American farmers are nearly through with harvest and a stream of supplies are already filtering out of the country’s export hubs on the U.S. Gulf and in the Pacific Northwest. Containerized shipments are also leaving the country via ports in California.

Politics aside, the economics of additional corn imports make sense, as traders can purchase and transport corn from overseas for roughly 70 per cent of the current cost of cash corn in Shandong province.

We have seen before that China is prepared to bend its own rules when it comes to securing corn supplies whenever domestic prices have exceeded overseas values by a wide margin.

So the stage could be set for another wave of Chinese corn imports — even if that does not fully jibe with government-stated intentions.

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