Connecting Supply with Demand

Connecting Supply with Demand

Mike Steenhoek, Executive Director, Soy Transportation Coalition, msteenhoek@iasoybeans.com

It is approximately 1,000 miles from Iowa to southern Louisiana — the No.1 launching point for U.S. soybean exports. It is approximately 1,800 miles from Iowa to the Pacific Northwest — the second leading export region. The inherent dilemma confronting Iowa and U.S. soybean exports has not been the ability of farmers to produce a quality, robust crop, nor has it been a lack of demand for that crop. The dilemma has been — and continues to be — being able to cost-effectively and reliably connect that crop with our international customers despite the extraordinary distance to our coastal areas.

Given this distance from Iowa to our export regions, it is reasonable to consider why soybean farmers in Iowa and throughout the country are among the most international of entrepreneurs rather than local, parochial, small business owners. The answer lies not only in the fact that farmers consistently grow what our customers demand, but they are also able to access a transportation system that effectively connects supply with demand. Without this connectivity provided by our system of roads and bridges, highways and interstates, freight railroads, inland waterways, and ports, a high percentage of what farmers grow will never be purchased by international customers.

To care about the export of soybeans requires one to care about the supply chain that facilitates it. For this reason the decision was made in 2007 by the Iowa Soybean Association and a number of other soybean farmer organizations to establish the Soy Transportation Coalition (STC). Funded by and led by soybean farmers, the organization explores each link in the farmer supply chain and endeavors to make them more cost-effective and reliable. The STC continues to pursue opportunities to strengthen rural roads and bridges, increase truck efficiency, promote reliable rail service, and enhance investment in inland waterways and ports.

To be an effective organization, the STC needs to consistently have two individuals in mind — the farmer growing the soybeans and the customer purchasing them. Our transportation system can either facilitate or be an obstacle between those two individuals doing business with each other. The STC continues to be focused on any opportunity to streamline that connection for mutual benefit.