The Impact of Infrastructure and Transportation Costs on U.S. Soybean Market Share: An Updated Analysis from 1992-2017

Delmy L. Salin and Agapi Somwaru

No 352079, Analysis from United States Department of Agriculture, Agricultural Marketing Service, Transportation and Marketing Program

Abstract: This paper follows up on an analysis published by the authors in 2015 titled, “Eroding U.S. Soybean Competitiveness and Market Shares: What is the Road Ahead?” The update examines new transportation routes that have emerged in Brazil and updates the data and analysis. Although the United States produces the largest volume of soybeans in the world, the U.S. market share of soybean world trade is declining. Using a dynamic econometric model and multivariate sensitivity analysis, export market shares' economic attributes are estimated retrospectively. This study quantifies the decline resulting from changes in ocean freight rates and the continued development of Brazil’s transportation infrastructure. The results suggest the U.S. world market share could decline an additional 12 percentage points assuming there are no significant improvements in U.S. transportation infrastructure serving the soybean supply chain, from farm to port. A decline of 1 percent in the U.S. soybean market share is equivalent to more than half a billion dollars lost in export sales; based on a world soybean trade volume of 152 million metric tons and today’s price of soybeans. Over the study period, 1992-2017, soybean market shares globally converge to an equilibrium indicating the stability of the market.

Keywords: Crop Production/Industries; International Relations/Trade; Marketing; Research Methods/ Statistical Methods; Supply Chain (search for similar items in EconPapers)
Pages: 37
Date: 2018-10
References: Add references at CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/352079/files/SoybeanMarketShare1992-2017.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:uamstr:352079

DOI: 10.22004/ag.econ.352079

Access Statistics for this paper

More papers in Analysis from United States Department of Agriculture, Agricultural Marketing Service, Transportation and Marketing Program Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().