USDA Report Confirms River Needs, Say Corn Growers

February 1, 2002

A recent USDA study validates many of the arguments posed by the National Corn Growers Association (NCGA) concerning the critical need for improvements to the transportation system of the Upper Mississippi and Illinois Rivers, according to NCGA. Paul Bertels, director of production and marketing for NCGA, said USDA's report, "Agriculture in Brazil and Argentina: Developments and Prospects for Major Field Crops" confirms the positions of the 32,000-member organization on remodeling locks and dams.

"The study largely confirms many of the arguments NCGA and others have been making regarding the need to improve the Upper Mississippi and Illinois Rivers," added Bertels. "Our competitive advantage in global grain markets is rapidly eroding. The world population is forecast to grow to 7.6 billion by 2020. For the U.S. to capture an increasing share of the global food demand, we need to increase the efficiency of our transportation systems. Otherwise, we will surrender another valuable market to our competitors. The Argentines and the Brazilians are gaining ground, largely through lower cost production, expanded production and infrastructure improvements."

Bertels summarized some of NCGA's key points on river issues:

* In any given year 60% of the bulk agricultural exports are moved to world ports via the Upper Mississippi and Illinois Rivers;

* U.S. Army Corps of Engineers indicates seven 1,200-foot lock chambers and five extended guidewalls on the Mississippi and Illinois Rivers would have a positive net benefit to the nation;

* The U.S. Army Corps of Engineers estimates that every $1 invested in navigation projects yields $6 in national benefits;

* Navigation on the Upper Mississippi and Illinois Rivers supports over 400,000 jobs, including 90,000 high-paying manufacturing jobs.

The USDA report, which quotes Bertels and NCGA member farmers from Iowa, Bill Horan and Tim Burrack, makes several other points concerning the advancement of South American agriculture in recent years. One key element is how Argentine corn production has increased 105% since 1990 and Brazilian corn production has jumped 40% in that same time frame. Bertels said part of the increase is clearly the result of their transportation system improvements.

"Economic and policy reforms as well as an improved transportation and marketing infrastructure in those two countries have lowered production and marketing costs and has made transmission of international market signals higher in quality," he said.

The situation in these South American corn-exporting countries will only improve, he noted. "It's highly probable Brazil and Argentina will expand area devoted to agricultural production in the coming years as well as increasing their potential to increase yields for several of their crops, including corn."