200607 Iowa Grain and Biofuel Flow Survey

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2006-07 Iowa Grain and Biofuel Flow Survey

• Iowa Institute of Cooperatives
• 2009 Winter Meetings
• Chad Hart Tun-Hsiang (Edward) Yu
• Assistant Professor Assistant Professor
• Iowa State University University of Tennessee

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Sponsoring Groups
Agribusiness Association of Iowa Iowa Biodiesel
Board Iowa Corn Promotion Board Iowa Farm Bureau
Federation Iowa Institute for Cooperatives Iowa
Renewable Fuels Association Iowa Soybean
Association Iowa Department of Economic
Development Iowa Department of Transportation
Project Partners Iowa Department of
Agriculture and Land Stewardship USDA-NASS, Iowa
Field Office
Thanks!
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Survey Format

• 5 distinct surveys
• Grain Marketers (Farmers)
• Grain Handlers
• Corn Processors (including Ethanol)
• Soybean Processors
• Biodiesel Producers

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Survey Participation
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Grain Marketers Results

• 2.05 billion bushels of corn were produced during
  the 2006/07 marketing year.
• 82 sold, 11 utilized on the farm, 7 remaining
  for future sales
• 510 million bushels of soybeans were produced
• 92 sold, 1 used on the farm, 7 expected to be
  marketed
• Over 60 million bushes of corn and 18 million
  bushels of soybeans were containerized on the farm

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Grain Marketers Results

• Average trucking distance by farmers ranges from
  4 miles for smaller wagons (lt500 bu.) to 24.5
  miles for semis.
• Average distance to market
• Unimproved gravel roads 5.5 miles
• Paved county roads 8 miles
• State highways 22.5 miles

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Producer Markets for Corn
8
Producer Markets for Corn
9
Shifting Markets for Corn
percent
10
Producer Markets for Soybeans
11
Producer Markets for Soybeans
12
Shifting Markets for Soybeans
percent
13
Transportation for Corn
14
Transportation for Soybeans
15
Grain Hauling Vehicles
16
Projected Change in Fleet by 2012
percent
17
Farmers Infrastructure Rating
18
Farmers Marketing Hindrances
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Grain Handlers Results

• About 1.09 billion bushels of corn and 311
  million bushels of soybeans were processed or
  shipped.
• More than 2 million tons of ethanol co-products
  were handled during the 2006/07 marketing year.
• Nearly 34 million bushels of corn and 11 million
  bushels of soybeans were containerized by Iowa
  grain handlers.
• Corn shipments
• 1999/2000 43 by truck, 57 by rail
• 2006/07 66 by truck, 30 by rail

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Handler Markets for Corn
21
Handler Markets for Corn
22
Shifting Markets for Corn Handlers
percent
23
Handler Markets for Soybeans
24
Handler Markets for Soybeans
25
Shifting Markets for Soy Handlers
percent
26
Handlers Corn Transport
27
Handlers Soybean Transport
28
Handlers Infrastructure Rating
29
Handlers Marketing Hindrances
30
Corn Processor Results

• 2 billion gallons of ethanol were produced
• Ethanol accounted for 85 of total dollar sales
• 92 of corn needs met by Iowa corn
• Average corn shipping distance 32 miles
• Average ethanol shipping distance
• By truck in Iowa 98 miles
• By rail to other states 955 miles

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Ethanol and Co-Product Markets
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Ethanol Markets
Note Percentage sold to other states and
countries 52
33
DDG Markets
Note Percentage sold to other states and
countries 25.5
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Soybean Processors Results

• Nearly 757 billion pounds of soybean oil and 6.8
  million tons of soybean meal were produced
• 73 do not expect to expand capacity
• 95 of processed soybeans were from Iowa
• Average truck haul of soybeans 48 miles
• Average soybean meal shipping distance
• In-state Truck 69 miles
• Other states Truck 362 miles Rail 1,242 miles

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Soybean Processors Results

• Soybean oil sales for industrial use
• In-state 36.5
• Other states 63.5
• Soybean oil sales for food use
• Other states dominate
• Soybean meal and oil sales account for 37 and
  29 of total dollar sales, respectively.

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Soybean Meal Markets
Note Percentage sold to other states and
countries 33.3
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Biodiesel Producers Results

• Biodiesel represented 94 of total dollar sales
• 40 capacity utilization rate for 2006/07
• 70 do not plan to add on-site crushing capacity
• 70 of soybean oil purchased from Iowa sources
• Average shipping distance 114 miles (by
  truck)

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Biodiesel Producers Results

• Out-of-state soybean oil
• 68 shipped by truck, average haul 126 miles
• 34 shipped by rail, average haul 371 miles
• Iowa biodiesel sales
• 65 shipped by truck, average haul 67 miles
• Out-of-state biodiesel sales
• 56 shipped by truck, average haul 268 miles
• 44 shipped by rail, average haul 1,167 miles

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Biodiesel Glycerin Markets
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Summary

• Continued demand for corn from the livestock and
  ethanol industries is expected to generate more
  demand for in-state transportation.
• Although the share of export markets decline, the
  volume may increase given the expanding harvests.
• The total vehicles owned by farmers continue to
  decline, however, the number of heavier vehicles
  (large wagons and semis) is expected to increase.

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Summary

• Most of the biofuels and co-products were sold to
  other states, translating to a higher demand for
  rail services.
• Interstate highways received the most positive
  feedback, gravel roads received the least.
• High transportation costs was the common hurdle
  for all five surveyed groups.
• A second round of surveys, this time for the 2007
  crop, is being conducted now.

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Thank you for your time!Any questions?My web
sitehttp//www.econ.iastate.edu/faculty/hart/S
urvey Reporthttp//www.card.iastate.edu/publicat
ions/DBS/PDFFiles/08sr102.pdf