1

 Wheat Transportation Profile

Agricultural Marketing Service / Transportation and Marketing Programs

November 2014

Executive Summary

America’s farmers depend on transportation as the critical link between the fields of growers and the tables of consumers, 

both here and abroad. Transportation demand is a derived demand because the production and consumption of an 

agricultural commodity create the demand for transportation services. As such, it is an essential part of marketing; any change

in supply or demand of the underlying commodity or commodities that compete for transportation services can affect the 

transport system’s efficiency by bringing about either shortages or surpluses in transportation capacity. Freight transportation 

is a critical element of U.S. agricultural competitiveness in the world grain markets. This report examines transportation 

implications of the recent trends and outlook for U.S. wheat. 

Key highlights:

 Since the mid-1990’s, U.S. wheat production has remained almost unchanged. The number of acres planted with 

wheat, however, decreased by almost 20 percent. An increase of over 20 percent in yield has offset the drop in 

acreage. 

 Despite unchanged production levels, the United States continues to be a major wheat exporter. Between 2009 

and 2013, the United States claimed an average 20 percent annually of the world wheat trade.

 All three major port regions (the Pacific Northwest (PNW), the Mississippi Gulf, and the Texas Gulf) are used to 

export wheat. In 2013, 36 percent of wheat was exported through the PNW, 27 percent through the Texas Gulf, 

and 29 percent through the Mississippi Gulf.

 The domestic wheat market is not as dynamic as the export market. Unexpected changes in export demand due to 

changes in world prices and global annual production levels can pose logistical challenges for U.S. grain shippers 

and carriers.

 According to the February 2014 USDA long-term projections that assume normal growing conditions, U.S. wheat 

exports are projected to increase slightly, by 1 percent over 10 years, and remain above 1 billion bushels per year. 

Domestic demand, however, is projected to decrease by 3.5 percent over the next 10 years.

 Based on these long-term projections, U.S. wheat exporters will continue to rely on rail service to ship the U.S. 

wheat to the ports for export, according to the USDA modal share analysis. Domestic demand by the livestock and 

poultry sectors is serviced by truck and rail.

Marina R. Denicoff Marvin E. Prater Pierre Bahizi
2

Introduction

U.S. farmers depend on freight transportation as the critical link along the supply chain between their fields and consumers,

located domestically and abroad. Because transportation is a derived demand, any change in supply or demand of the 

underlying commodity can affect the transport system’s efficiency by bringing about either shortages or surpluses in 

transportation capacity. Short-term agricultural transportation demand can be influenced by weather disruptions, variation in 

annual crop size, changes in the timing of the agricultural cycle, global trade patterns, quality concerns, competition in 

production by other countries, and resulting commodity price fluctuations. These and other factors can translate into 

unexpected shifts in transportation patterns and costs, adding to the ever-present commodity price risk to be managed by 

agricultural producers, processors, and shippers. 

The United States is a major producer of wheat, trailing only the European Union, China, the Former Soviet Union (FSU), and 

India.1 It is also a major exporter of wheat, with a 20-percent share of world wheat trade. Other major wheat suppliers 

include Canada, Australia, the European Union, and FSU-12.2 Wheat is the third most-grown crop in the United States by 

acreage, after corn and soybeans. However, due to policy changes and smaller economic returns than other crops, the 

amount of land devoted to wheat has decreased by 30 million acres since its peak in 1981.3

Supply and Demand

In the United States, the wheat marketing year begins on June 1. However, there are two wheat harvests: one in the spring 

and one in the fall. Winter wheat is planted in the fall and harvested in the spring, while spring wheat is planted in the spring 

and harvested in the fall. The winter wheat crop is substantially larger; 72 percent of wheat grown in 2013 was winter wheat.

4

 

Harvest timing is an important factor in agricultural transportation. Typically, demand for transportation is highest at harvest

times, and most of the newly harvested wheat is shipped by truck to grain elevators for storage and by rail or barge to ports

for export. 

Total planted acreage has steadily declined since the mid-1990s, but wheat production has remained relatively stable or 

dropped just slightly because yields have increased (see figure 1).5 During the 5 years between 2008 and 2012, U.S. growers 

planted an average of 57 million acres of wheat per year, almost 20 percent fewer than in the mid-1990s, while yields 

increased to 45 bushels per acre, slightly over 20 percent over the same period. 

1 USDA/Foreign Agricultural Service Production, Supply and Distribution Online.

2 Ibid.

3 USDA/Economic Research Service (ERS), Wheat Briefing Room and Wheat Yearbook Tables, 2014.

4 USDA/National Agricultural Statistics Service Quickstats, Winter Wheat Production by State, 2013.

5 USDA/Agricultural Marketing Service (AMS) Analysis of USDA/Economic Research Service Wheat Yearbook Data, All years for Table 1.
3

Declines in acreage can be attributed to several factors. Wheat has a lower return than other commercial crops. Increased 

international competition from lower cost of production regions, in particular, has lowered the profit margin for U.S. wheat 

farmers, encouraging shifts to corn and soybeans. Furthermore, flexibility programs built into farm subsidy legislation have

encouraged wheat farmers to diversify their crops. In 1996, new laws removed base acreage requirements for subsidized 

crops, allowing wheat farmers to devote more of their land to other crops in response to market conditions.6

Domestic demand for wheat is driven primarily by the food industry. From 2005/06 to 2013/14, 78 percent of wheat 

consumed domestically was used for food. The remainder was used for animal feed, seed, and residual (see table 1).7 Demand 

for wheat for food has remained remarkably consistent from 2001/02 to 2011/12 with a low of 910 million bushels (mbu) in 

2004/05 and a high of 948 mbu in 2007/08. Demand for exports has been more volatile, with a high of 1,291 mbu in 2010/11 

and a low of 850 mbu in 2002/03 (see figure 2). 

Many factors contribute to the volatility of demand for U.S. wheat in global markets. Demand fluctuates with the gross 

domestic product and population growth of major importing countries. In addition, changes in the value of the dollar affect the

price of wheat from the United States as compared to other exporters. Meanwhile, droughts, bumper crops, and political 

decisions (the 2010 Russian wheat export embargo, for example) alter global wheat supplies and prices.

6 USDA/ERS Wheat Yearbook Tables, 2013.

7 USDA/ERS Wheat Yearbook Tables, 2013; Feed and Residual Use category is calculated to ensure that ending stocks are consistent with total supply 

and known uses of wheat for export, seed, and food. The estimate includes both feed use and a residual that accounts for errors made in estimating 

the other variables. For more information, see: http://www.ers.usda.gov/topics/crops/wheat/estimating-wheat-supply-and-use.aspx.

Figure 1: U.S. Wheat Production and Planted Acreage, 1995/96 to 2012/13* 

*2012/13 is the marketing year for wheat; it begins June 1 and ends May 31.

Source: USDA/National Agricultural Statistics Service Crop Production, 2013 Summary, January 2014. Production in million 

bushels is indicated by the bars and read from the left axis, while harvested acres in million acres is shown by the line and

read from the right axis. 
4

Table 1: U.S. Wheat Supply, Demand, 1995/96 to 2013/14*

*USDA Forecast, July 2013 World Agricultural Supply and Demand Estimates, http://www.usda.gov/oce/commodity/

wasde/index.htm. 

Source: USDA/Economic Research Service Wheat Yearbook Tables, 2013

Supply Use

Year Beginning 

Stocks Production Imports Total Food Feed, Seed, Residual Exports Total Stocks/Use Ratio

― Million Bushels ―

1995/96 507 2,183 68 2,757 883 257 1,241 2,381 16%

1996/97 376 2,277 92 2,746 891 410 1,002 2,302 19%

1997/98 444 2,481 95 3,020 914 343 1,040 2,298 31%

1998/99 722 2,547 103 3,373 910 471 1,046 2,427 39%

1999/00 946 2,296 95 3,336 929 371 1,086 2,386 40%

2000/01 950 2,228 90 3,268 950 379 1,062 2,392 37%

2001/02 876 1,947 108 2,931 926 265 962 2,154 36%

2002/03 777 1,606 77 2,460 919 200 850 1,969 25%

2003/04 491 2,344 63 2,899 912 283 1,158 2,352 23%

2004/05 546 2,157 71 2,774 910 259 1,066 2,234 24%

2005/06 540 2,103 81 2,725 917 234 1,003 2,154 27%

2006/07 571 1,808 122 2,501 938 199 908 2,045 22%

2007/08 456 2,051 113 2,620 948 104 1,263 2,314 13%

2008/09 306 2,499 127 2,932 927 333 1,015 2,275 29%

2009/10 657 2,218 119 2,993 919 219 879 2,018 48%

2010/11 976 2,207 97 3,279 926 200 1,291 2,417 36%

2011/12 862 1,999 112 2,974 941 238 1,051 2,231 33%

2012/13* 743 2,266 123 3,131 945 461 1,007 2,414 30%

2013/14* 718 2,130 160 3,008 950 324 1,125 2,399 25%
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USDA long-term projections show total production averaging about 2.2 bbu by 2023/24, up almost 3 percent from 2013/14 

(see figure 3). Over this timeframe, domestic consumption is expected to decrease to 1.3 bbu, 3.5 percent lower than in 

2013/14. Exports, however, are expected to increase to 1.3 bbu, 1.4 percent higher than in 2013/14.8 The long-term 

projections by their nature cannot forecast year-to-year fluctuations. However, if the stable lower export demand persists, the

demand for rail service to ship wheat to port will also remain low, because rail is the primary mode of transportation for 

moving wheat to port (see Wheat Modal Shares section of the report).

Figure 2: Yearly percent changes in wheat demand, for food and exports, 2001/02 to 2012/13

*The 2013/14 marketing season is projected. 

Source: USDA/Economic Research Service Wheat Yearbook Tables, 2014 

-30%

-20%

-10%

0%

10%

20%

30%

40%

50%

60%

2001/02 2003/04 2005/06 2007/08 2009/10 2011/12 2013/14*

Y/Y % change

Food

Export

8 USDA ERS/OCE Agricultural Long-Term projections to 2022/2023, February 2013.

Figure 3: USDA long-term projections for wheat, 2013/14 to 2023/24* (as of February 2014)

*2023 is marketing year 2023/24. 

Source: USDA Economic Research Service/Office of the Chief Economist Agricultural Long-Term projections to 2023, 

February 2014 

0

500

1,000

1,500

2,000

2,500 Bushels (millions)

Production

Domestic Consumption

Exports
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Transportation Implications 

Transportation demand for wheat used domestically does not change greatly year to year. Wheat exports, however, fluctuate 

based on foreign demand and competition from other exporters (see figure 2). Export demand, therefore, is one of the 

principal variables affecting wheat export logistics, which primarily rely on shipping by rail to port (see table 2).

Table 2: Wheat modal shares, 2002 to 2011 

Year & Type of Movement 

Rail Barge Truck 

1,000 Tons Percent 1,000 Tons Percent 1,000 Tons Percent 

Total 

2007 47,777 71% 10,515 16% 9,132 14% 

2008 45,670 69% 8,872 13% 11,959 18% 

2009 41,094 72% 8,462 15% 7,582 13% 

2010 44,017 70% 8,471 14% 10,202 16% 

2011 43,417 63% 9,844 14% 15,580 23% 

Average 42,324 67% 9,559 15% 11,417 18% 

Export 

2007 24,806 67% 10,229 28% 2,004 5% 

2008 24,519 72% 8,428 25% 883 3% 

2009 17,117 68% 7,970 32% 63 0% 

2010 22,369 72% 8,013 26% 838 3% 

2011 22,845 63% 9,333 26% 4,232 12% 

Average 21,283 67% 9,130 29% 1,298 4% 

Domestic 

2007 22,971 76% 286 1% 7,127 23% 

2008 21,151 65% 444 1% 11,076 34% 

2009 23,977 75% 493 2% 7,519 24% 

2010 21,647 69% 458 1% 9,364 30% 

2011 20,572 63% 511 2% 11,348 35% 

Average 21,041 67% 430 1% 10,119 32% 

Source: Transportation of U.S. Grains: A Modal Share Analysis 1977-2011. USDA/Agricultural Marketing Service. May 2013

2006 44,735 77% 8,767 15% 4,324 7% 

2005 44,180 71% 8,668 14% 9,441 15% 

2004 40,924 61% 11,937 18% 13,973 21% 

2003 36,900 57% 10,180 16% 17,710 27% 

2002 34,523 59% 9,876 17% 14,270 24% 

2006 20,804 71% 8,566 29% 0 0% 

2005 23,613 74% 8,294 26% 0 0% 

2004 21,439 61% 11,370 32% 2,400 7% 

2003 18,348 62% 9,726 33% 1,316 4% 

2002 16,966 62% 9,367 34% 1,247 5% 

2006 23,931 84% 200 1% 4,324 15% 

2005 20,567 68% 375 1% 9,441 31% 

2004 19,485 62% 566 2% 11,573 37% 

2003 18,552 52% 454 1% 16,394 46% 

2002 17,556 56% 509 2% 13,023 42% 
7

Most wheat is produced in the Midwest and is shipped to flour mills, ports, and—in smaller quantities—to feedlots and feed 

mills. In 2013/14, over 100 million bushels of wheat, 54 percent of total U.S. production, were produced in six States: Kansas,

North Dakota, Montana, Washington, Oklahoma, and Idaho. Although the top wheat-producing States have varied over the 

last decade, growing is generally concentrated in the Plains States of the central and western parts of the country.9 

Wheat is transported to major population centers around the United States for food use, and a significant portion is moved to

ports in the Gulf of Mexico and the Pacific Northwest for export. The map in figure 4 displays wheat production by county and 

shows the largest wheat export ports and the location of main rail lines and waterways. 

Figure 4: 2013 wheat production map by county with wheat export ports and transportation system

9 USDA/NASS Quick Stats, Wheat Production by State, 2001-2013.
8

Wheat Modal Shares

From 2002 to 2011, wheat accounted for 14.2 percent of all grain movement. Wheat for both domestic use and export is 

transported primarily by rail (see table 2). Rail is the dominant mode of transportation for wheat grown in the Great Plains

States,10 where barge transportation is not accessible. Because wheat is often transported over long distances to ports and 

milling locations in bulk, shipping by rail is cheaper than shipping by truck.11

U.S. grain shippers rely on three and sometimes all four modes of transportation to deliver the grain to a primary destination, 

such as Japan. Shipping wheat to a primary destination can be accomplished via truck, rail, and ocean vessels through the 

Pacific Northwest ports or through the U.S. gulf via barges moving down the Mississippi River in addition to the other modes 

of transportation.

Figure 5 shows the relative costs (in dollars per metric ton) by mode of transportation (truck, rail, and ocean) of shipping wheat 

from Kansas to Japan via the Pacific Northwest from the 1st quarter of 2005 to the 1st quarter of 2012. Total transportation

costs spiked from the 4th quarter of 2006 to the 3rd quarter of 2008, fueled by higher diesel prices and strong demand for U.S. 

grain exports. In the years since the 2009 global financial crisis and the ensuing economic slowdown, total transportation costs 

have fallen substantially and have returned to the pre-financial crisis levels. 

10 Colorado, Kansas, Montana, Nebraska, New Mexico, North Dakota, Oklahoma, South Dakota, Texas, and Wyoming.

11 Transportation of U.S. Grains: A Modal Share Analysis 1977-2011. USDA/AMS. May 2013

Figure 5: Modal transportation costs for shipping wheat from Kansas to Japan through the Pacific Northwest by 

quarter, 2005 to 2013

Source: USDA/Agricultural Marketing Service, Transportation costs for major grains, 2014.
9

Wheat Exports by Port Region

In 2013, 36 percent of wheat was exported through the Pacific Northwest (PNW), 27 percent through the Texas Gulf, and 29 

percent through the Mississippi Gulf (see figure 6).12 The major destinations for 2013 U.S. wheat included China and other 

Asian destinations, Brazil, Mexico, Japan, and Nigeria.13 Because U.S. wheat is shipped to all regions of the world, the top 10 

importers accounted for only 75 percent of total U.S. exports in 2013.

The ocean freight spread between the U.S. Gulf and the Pacific Northwest can influence the decision grain shippers make when 

choosing the export port for the grain. Figure 7 shows the spread (difference) in total transportation costs between shipping 

from Kansas through the U.S. Gulf and the Pacific Northwest. From the 1st quarter of 2005 to the 4th quarter of 2013, shipping 

through the Gulf was, on average, $4.46/mt more expensive.14

12 USDA/Federal Grain Inspection Service Grain Inspections, 2013.

13 USDA/Foreign Agricultural Service Marketing Year Final Reports.

14 USDA/AMS, Transportation costs for major grains, data collected by AMS Transportation Services Division, 2012. 

Figure 6: Wheat Exports by Port Region, 2013

Source: USDA/Federal Grain Inspection Service Grain Inspections, 2014. 

Figure 7: Spread of total wheat transportation costs between Gulf to Japan and Pacific 

Northwest (PNW) to Japan (Gulf total costs minus PNW total costs), Q1 2005 to Q4 2013

Source: USDA/Agricultural Marketing Service, Transportation costs for major grains, 2012. 
10

Conclusion

Wheat is used widely in domestic food production and is needed around the world in differing quantities year to year. Most of 

the U.S. population lives far from the wheat-producing areas, requiring wheat shippers to rely on long-distance freight 

transportation options. The changing overseas destinations for U.S. wheat often require producers to be flexible in shipping 

their product long distances to the three major ports regions. Wheat exports rely mostly on rail transportation to reach the

ports. An efficient and flexible U.S. transportation network, particularly the rail system, is important for keeping U.S. wheat

competitive in the world wheat market.

References

1. Yearbook Tables: http://www.ers.usda.gov/data-products/wheat-data.aspx#25170

2. Economic Research Service briefing room: http://www.ers.usda.gov/topics/crops/wheat.aspx

3. NASS Quickstats: http://quickstats.nass.usda.gov

4. Modal Share Analysis: http://www.ams.usda.gov/ATModalShareReport

For more information, contact Marina Denicoff at (202) 690-3244 or Marina.Denicoff@ams.usda.gov.

Preferred citation:

Denicoff, Marina R. , Marvin E. Prater, and Pierre Bahizi, Wheat Transportation Profile. U.S. Department of Agriculture, 

Agricultural Marketing Service, November 2014. Web. http://dx.doi.org/10.9752/TS201.11-2014

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