1

REPORT SUMMARY

Agricultural 

Marketing 

Service

August 2021

This is a summary of “A Study of Grain and Soybean Export Flows: Uncovering Their Determinants and the 

Implications for Infrastructure Investment,” by Tobias Sytsma and Wesley W. Wilson.1 This research and analysis 

received funding from USDA’s Agricultural Marketing Service (AMS) through cooperative agreement number 

18-TMTSD-OR-0009. The opinions and conclusions expressed are the author’s and do not necessarily reflect the 

views of USDA or AMS. The full paper is available at: https://ageconsearch.umn.edu/record/310904.

WHAT IS THE ISSUE?

Port infrastructure in the United States supports extensive global trade of agricultural commodities. According to USDA’s 

Foreign Agricultural Service, U.S. agricultural producers export more than 20 percent of their production annually.2 U.S. 

exports have tripled over the past two decades, and domestic ports have competed for these growing freight volumes. 

Various port attributes, such as channel depth and berthing length, may grant some ports a competitive advantage in the 

market for agricultural freight. Such features affect costs borne by importers and exporters of U.S. agricultural goods, as well 

as regional economies that depend on port traffic.

The study from the University of Oregon models two facets of export flows to better understand port infrastructure: 

(1) the importing country’s choice of port in the United States, and (2) the inland U.S. shipper’s choice of export port. 

The researchers focused on shipments of corn, soybeans, and wheat to determine how transportation costs and port 

characteristics affect port choice.

1 Sytsma is a former graduate student, and Wilson is a professor in the Department of Economics (College of Arts and Sciences) at the 

University of Oregon.

2 USDA Foreign Agricultural Service, “Percentage of U.S. Agricultural Products Exported,” May 30, 2018.

A Study of Grain and Soybean Export Flows: Uncovering 

Their Determinants and the Implications for 

Infrastructure Investment (Summary)

Jack Novak, Peter Caffarelli, and Jesse Gastelle
2

WHAT DID THE STUDY FIND?

The researchers analyzed how port attributes and shipping costs affected demand from and to U.S. port locations. 

Importers and exporters across commodities were found to prefer ports with favorable attributes, such as deep 

channels and long total berthing lengths, which allowed for lower per-unit costs.3 Shippers also favored proximate 

port locations to more distant locations. 

Ports in the United States compete for freight traffic, and a port’s share of total traffic is generally determined by 

several factors, including how cheaply it can move freight. To that end, the researchers conducted a sensitivity analysis 

to explore how port choice responded to changes in transportation costs and attributes. Cost increases at a port 

reduced the likelihood the port was chosen, decreasing the volumes that shippers choose to buy or sell through the 

port. For example, a 1-percent increase in a port’s shipping costs corresponded to a 6- to 8-percent reduction in the 

port’s traffic and a slight increase in traffic at each nearby port. In general, volumes of corn and soybeans were more 

sensitive to changes in transportation costs than those of wheat. They also found a 1-percent increase in channel 

depth resulted in a port gaining 1 to 3 percent more business, and a 1-percent increase in berthing length resulted in 

about 1 percent more traffic.

Other factors were found to influence a port’s likelihood to be chosen by shippers, such as proximity to major trading 

partners and barge access. Shippers preferred ports with a barge option, given barge rates are generally lower 

compared to rail. Additionally, global trade dynamics influenced port shares; for example, ports in Western States have 

gained market share in recent years as the United States has increased trade with countries in Asia.

HOW WAS THE STUDY CONDUCTED?

To examine the importing country’s port choice, the researchers relied on ocean rate data from O’Neil Commodity 

Consulting and trade data from the U.S. Census Bureau from 2003 to 2017. They gathered data on port attributes 

(corresponding to 2016) from a variety of sources, including the World Port Index, U.S. Army Corps of Engineers, and 

port websites. The researchers used and adapted two models: one model to estimate the probability that a shipper 

would choose a port, and another model to estimate the trade intensity or volume between two countries.

To investigate the shipper’s choice of export port, the researchers assembled rail data from the Surface Transportation 

Board’s Carload Waybill Sample and barge data from the USACE’s Waterborne Commerce Statistics from 2014 to 

2018. They used a random utility model, where shippers selected the port that provided the highest payoff. From 

the estimates, the researchers simulated how the probability a port would be selected changed with increases in 

transportation costs. They also calculated shippers’ port elasticities with respect to rail rates.

PREFERRED CITATION

Novak, Jack, Peter Caffarelli, and Jesse Gastelle. August 2021. A Study of Grain and Soybean Export Flows: Uncovering 

Their Determinants and the Implications for Infrastructure Investment (Summary). U.S. Department of Agriculture, 

Agricultural Marketing Service. Web. <http://dx.doi.org/10.9752/TS340.08-2021>

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3 Importing countries and inland shippers of agricultural products may not place direct importance on the channel depth of a port, 

for example, but the channel depth factors into the port choice decision through its effect on the port-level price.