As this American holiday draws to a close and we fondly remember the Thanksgiving dinner that is now just Tupperware leftovers, the satisfaction of who we are and where we are settles upon us. Even with the uncertainty of the world, it is comforting to live on fertile land in the interior of a large continent and enjoy the free-flowing exchange of goods and services. There is logic to the progression that brought us to our desired equality with our countrymen on all coasts. It's called "Infrastructure." But there is also the concern, at least by me, that what we don't protect and improve, we lose.
Infrastructure for its own sake is boring to all but the builders. The pathways of transportation and the chain of production, processing and distribution all are parts of the underpinnings of our economic system, but the real proof of its worth is in what you paid for Thursday's dinner. The cost, according to the American Farm Bureau Federation's 20th annual survey indicates that a family of ten could be well fed for $36.78.
That means you could sit down with three generations of your family and dine on turkey, stuffing, sweet potatoes, rolls with butter, peas, cranberries, a relish tray of carrots and celery, pumpkin pie with whipped cream and finish it off with coffee and milk for $3.67 per person. That's unbelievable! Not just the price, but the availability of items, both seasonal and non-seasonal, that you can pick up at your local supermarket.
We live more than 1,000 miles from where some of these items were grown or processed, yet they are as available here as in San Diego or Atlanta. There are apologies because this price is up $1.10 from last year due to higher transportation costs. In a year with the natural disasters, disruptions and spikes in fuel prices, this is the true value of "infrastructure."
If a country doesn't have the means to ship from the interior farming regions, the handicaps are obvious. They are colorfully illustrated in this week's report from FCStone do Brasil, a division of an American commodity brokerage company. Curt Goulding is the SA president and writes:
"We have all heard the stories of lines (of trucks) being 100 km (62 miles) long at the port, well those stories are true. Think about the guy who is hauling from Mato Grosso to Paranagua'. A trip of more than 2,000 km (1,240 miles). A truck driver is lucky to make three turns in a harvest. Consider how many trucks it takes to handle a harvest here with such poor infrastructure. It is estimated that Brazil only has about 40 percent of the storage capacity they need for storing grains, and most of the capacity is in the south. Eighty percent of the grain is moved via truck. The balance moves via water and rail. One of the challenges of the rail system is the lack of a standardized track gauge. There are at least 3 different gauges in operation here today."
In the Midwest of the North American continent, we consider Brazil to be our most formidable competitor with soybean acreage almost equal to ours and vast areas of farmland that grow every commodity from citrus to cotton, yet they do so with a transportation system that we could not endure.
Brazil is now taking steps to open up waterways and build rail lines using a "private-public" partnership, meaning private investment in infrastructure with tolls to pay back the costs. It may work if the government remains stable and the value of commodity crops exceeds their cost of production.
At this point, according to Iowa State University transportation studies, it costs about one and one half times as much to ship a bushel of soybeans from Matto Grosso to Rotterdam harbor (Europe) as compared to a bushel of soybeans from Jefferson, Iowa. That is our only advantage over a country with cheap land and labor. Yet, we are giving up our advantage every day. We are quietly becoming totally dependent on the truck to transport our products into and out of our rural areas. We once had river and rail service that were the best in the world, now both have declined or disappeared.
It seems ironic that Brazil is trying to reduce its dependency on trucks and moving toward rail and barge while we are doing the opposite. It seems only logical for those dependent on transportation (and that is all of us) to desire more than one option. Our small barge canals of the 19th century were displaced by a much faster and more efficient rail system. In the 20th century, the rail lines consolidated and collapsed into a network that still has large capacity but wishes to devote most of its service to non-agricultural products like coal and containers. The lines in rural areas were taken out over the last 20 years and returned to the landowners or replaced with hiking trails. The only conveyance for our commerce is the truck that burns diesel in great quantity per unit of goods shipped. This year's hurricanes showed the vulnerability of fuel supply and the volatility of price.
We should never have allowed our local rail lines to be removed. This country didn't have an economic model for profitable railroads in the last half of the 20th century and regulation made almost all efforts to run a shortline railway an economic disaster. We should offer a means for public-private transportation partnerships to put strategic portions of these lines back into service.
Water transportation is not assured either, as the locks on the Mississippi have become a major battleground between those who see the river as a highway of commerce and those who see it as a recreation destination. Somewhere between the extremes has to be a workable solution.
Now that this discussion has your turkey dinner sloshing in anguish, be pleased with how far we've come from our pioneer parentage, but be vigilant so that we do not give up our gains just because, at the moment, we are fat and happy.
Editor's note: Ken Root is a farm anchor at WHO Radio in Des Moines, Iowa. He is a 28-year veteran of agricultural broadcasting and writing. He can be reached by e-mail at: kenroot@clearchannel.com or by writing to him at the Journal at P.O. Box 760, Dodge City, KS 67801.
Date: 11/23/05