First-quarter transportation costs from Minneapolis, Minn., to Japan via the U.S. Gulf decreased 8% for shipping corn and soybeans when compared to the fourth quarter 2021, the U.S. Department of Agriculture said today.
Costs to ship corn and soybeans from Minneapolis to Japan via the Pacific Northwest (PNW route) decreased slightly for the same time period, the USDA said. From first quarter 2021 to first quarter 2022, costs to ship corn and soybeans by the U.S. Gulf route increased substantially, mainly because of a significant increase to barge transportation rates.
For the same period, costs to ship by the PNW route increased moderately for corn and soybeans, primarily because of higher truck and ocean freight rates. The year-to-year increase in ocean rates reflects various factors, including high bunker fuel prices caused by turmoil surrounding Russia’s invasion into Ukraine. (USDA Grain Transportation Report (GTR), April 28, 2022). Total landed costs for shipping corn and soybeans to Japan by each route increased both from quarter to quarter and from year to year.
From quarter to quarter, transportation costs for shipping corn and soybeans via the Gulf route decreased 8% mainly because of lower barge and ocean rates, which dropped 17% and 12%, respectively, the USDA said. Year to year, transportation costs rose 33% each for corn and soybeans, mainly because of substantial increases in barge rates (over 130%) and lesser increases in ocean and truck rates.
For shipping corn, first-quarter 2022 transportation costs accounted for 41% of landed costs, reflecting a quarter-to-quarter decrease and year-to-year increase. For shipping soybeans, first-quarter transportation accounted for 22% of landed costs, reflecting a quarter-to-quarter decrease and a year-to-year increase, the USDA said.
