Grain Shipments on the Mississippi River System: A Long-Term Projection

The costs of delays for shipping commodities on the Mississippi River are important and adversely impact growth in shipments. Lock and dam expansion requires substantial capital investment and an extended time period to complete. This study analyzes delay costs and the competitive position of grain shipments on the Mississippi River system. A spatial optimization model of the world grain trade was developed. Results indicated that without expansion in barge capacity, delay costs in 2020 would increase on each reach, with some up to $1.08/mt. Expansion results in reduced delay costs. Barge demand is also impacted by rail capacity. Finally, expanding the locks would result in a re-allocation of shipments among modes, reaches, and ports, notwithstanding minor adjustments in production.