Issue 26
February 2000

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Prairie Grains is the official publication of the Minnesota Association of Wheat Growers, North Dakota Grain Growers Association, South Dakota Wheat, Inc., and the Minnesota Barley Growers Association.

Copyright
Prairie Grains Magazine
February 2000

Rise in container shipping expected with bonanza in IP grain exports

By Tracy Sayler

In 1980, close to 80% of all cargo transported by ocean-going vessels were bulk commodities, and about 20% of export commodities were containerized. Now, about 60% of seaborne cargoes are transported in containers.

"The amount of containerized commodities moving overseas has tripled in the last 20 years.  We'll never see 100% containerization, because some commodities such as oil and coal will continue to be shipped in bulk.  But containerized cargo will continue to grow, and grain is one commodity we would expect to see containerization ratchet up incrementally higher," says Scott Sigman, who oversees dry special container product lines for Transamerica Leasing Inc., a New Jersey-based company that supplies containers for commodity shipments.

Sigman, who began his career on Capitol Hill as a congressional staff member specializing in overseas trade issues, participated in a conference held recently in Fargo on how to establish container and identity-preserved grain marketing channels, organized by the Upper Great Plains Transportation Institute.

The market for grain shipped with certain qualities or characteristics—identity preserved grain—is increasing, he says, and that translates into a greater need for containers to keep IP grain separate during shipping.

"There will be grain such as #2 soybeans that will continue to be barged in the hold of a ship as a bulk commodity.  But high oleic, high protein beans will require small lots and higher quality control, and containerization provides the means of doing that," says Sigman.

Most containers used for grain are either 20 ft long x 8 ft wide or 40 ft long x 8 ft wide.  Container liners—essentially large special bags that fit inside shipping containers, in various sizes that hold as little as 50 pounds or as much as 44,000 pounds—help protect containerized commodities from moisture and contaminants such as insects or other foreign material.

For farmers and grain handlers, containerization may mean less silo-to-silo transfer movement and costs after harvest, and better control of IP grain flows, says Sigman.  Along with greater preservation of quality characteristics, containerized cargo often is easier to load and unload, and can be transported by truck, rail, or ship.  Containerization aids in transporting goods to areas of the world that do not have suitable port facilities. 

The fact that containerized shipping is intermodal could also make transportation costs in the Northern Plains more competitive, Sigman says.

Other areas of the world are also moving more toward containerized shipping. In Australia, containerized grain for export already moves from farm gate to terminal.  In Europe, government officials hope containerized shipping (containers are stackable) via barge and rail will bring an additional benefit of less congested roads. 

More containerized shipping is being used in Canada as well.   For example, containers from Sigman's company are used by some in Canada to ship pulse crops such as peas.  "As (grain processing companies) become comfortable using containers to ship one commodity, they're more apt to use it for others as well," he says.

Some U.S. farm commodities are already routinely shipped in containers—barley malt, for example.  Containers were also used to ship food and grain in the recent relief effort to Kosovo and following flooding in Venezuela, Sigman points out.  He says that as far as he is aware in Northern Plains states, about the only grain shipped by containers now are hybrid corn, popping corn and some sunflower.