6 minute read
Have Grain, Will Travel
Have Grain, Will Travel
Seasons move fast, but Iowa's crops move faster
By Joseph Hopper
Each autumn, farmers jump into their combines to begin the harvest season. When harvest is over and farmers can finally take a deep breath, Iowa’s landscape is transformed without crops in the fields. Where do all those billions of bushels of corn and soybeans go? Some of it is destined to stay within the state, but some will travel in trucks, on rails and across oceans to get to their final destination.
“The journey from farm to end customer starts with a truck or grain wagon over the road, and it’s commonly going to a co-op or elevator,” says Mike Steenhoek, executive director of the Soy Transportation Coalition.
The grain elevators run by Iowa’s co-ops, or cooperatives, can be pretty easy to spot. Look for the trucks going to and coming from the big, iconic structures that make up the skylines of rural communities.
“You’ll see big steel or concrete silos in the countryside. You can store all types of commodities in a grain elevator,” says Zack Gardner, grain marketing and origination specialist at Key Cooperative. “Corn, soybeans, wheat, sunflowers — you name it.”
Co-ops are more than just a location. Gardner says a co-op’s philosophy is to help farmers in every facet of their operation.
“Storing grain is a predominant aspect of our business, so if a farmer doesn’t want to immediately price their grain or ship it to the end user, they bring it to us and we store it for them throughout the year,” Gardner says. “As they make sales, we turn around and ship it to the end user for them.”
To keep the grain in good condition, it needs to stay at a consistent temperature while also meeting requirements for humidity and moisture levels. Just like getting food out of a grocery store freezer, there are a lot of logistics, labor and hands at work to ensure food is safely stored and transported.
“The big picture includes many people who care that things are done right for the consumer,” he says.
Total Iowa Production in 2022
2.48 billion bushels of corn (62.9 million metric tons)
587 million bushels of soybeans (15.9 million metric tons)
Source: USDA National Agriculture Statistics Service
Total U.S. Exports in 2022
58 million metric tons of corn
57 million metric tons of soybeans
12 million metric tons of soybean meal
Source: USDA Foreign Agriculture Service
Domestic or International
Iowa has a strong local market for its crops, thanks to demand from grain processing facilities and the many animals in the state that consume crops as part of their daily diet. There’s also a strong demand for Iowa-grown commodities in countries all over the world. Both corn and soybeans are often called “food, fuel and fiber” thanks to the growing number of different ways they can be used to create products.
A whole soybean isn’t fed to an animal; it needs to be processed and crushed, making soy meal and soy oil.
Lyndsey Erb, director of industry relations at the U.S. Soybean Export Council explains, "When we're talking about foreign buyers, they’re either going to commercial trading houses bringing soybeans in to crush, or to other markets importing the meal and introducing it directly into their ration. China, Europe and Egypt all have big crush markets; that soybean meal will end up in a feed ration, and the soybean oil will be used for other purposes,” explains Erb.
Gardner notes this year a little over half of the bushels in Key Cooperative's elevators went via truck to the processor here in Iowa. For example, corn went to ethanol plants to produce fuel for cars and soybeans into crush facilities. The other half left via rail out of their Nevada co-op location. "The corn has gone into feed yards in Kansas, Texas, California and just west of the Rockies," Gardner explains. "The soybeans have gone either to Mexico to be crushed or to the export market — for example, China — where they are turned into hog feed.”
Worldwide Enterprise
Iowa is uniquely positioned to export its grain because of an aquatic asset — the mighty Mississippi River. Many grain elevators are conveniently located next to the Mississippi to load huge barges with Iowa-grown commodities, which then head downriver to New Orleans. The river’s not just for exports either. The fertilizer that farmers use to grow crops often travels up the Mississippi to Iowa the same way.
“All of the little rivers and tributaries to the Mississippi end up in New Orleans, and a massive amount of our soybean export is out of the gulf,” says Erb. “Then those soybeans end up in dozens of markets all over the world.”
“In a state that’s located in the middle of a country but aspires to export, you have to move long distances in an economical manner; it’s the secret to our success,” Steenhoek says. “Brazil, which exports a lot of soybeans, is still making improvements to its infrastructure. It has disproportionally long, 1,000-mile truck trips, whereas we’re able to use this maritime highway — especially in eastern Iowa. You wouldn’t expect Iowa farmers to be international entrepreneurs, but they are, because they’re located next to an infrastructure that can accommodate what they grow.”
Barge traffic carrying Iowa-grown cargo is eventually loaded onto much larger ships to reach destinations like China, Mexico, Egypt and the European Union. A Panamax-sized vessel, commonly used to move cargo across the ocean, holds 55,000-60,000 tons, or 590 rail cars worth of goods.
“At a high point, these assets down at the Gulf are loading a ship probably every 24-34 hours, and there are probably half a dozen export elevator assets down in New Orleans,” Erb says. “That’s a massive amount of soybeans that are moved, and Iowa is obviously a huge producer.”
Erb adds, “I think farmers are the most international business professionals of anyone I’ve ever worked with. Whether they know it or not, the things they do and the marketing decisions they make affect people all over the world. We are a very international business.”
