A recent study warns that future soybean production increases, along with infrastructure improvements by South American competitors, could suppress the profitability of the U.S. soybean industry. The study looked at 26 states, accounting for 97 percent of the soybeans transported in the country. Mike Steenhoek, executive director of the Soy Transportation Coalition, says the key findings indicate a need to expand transportation capacity to meet increasing supply and demand, especially from China. China’s annual soybean imports will increase by another 2.7 billion bushels through 2023.

Steenhoek says the U.S. transportation system gives U.S. farmers a significant competitive advantage over international competitors. However, the study points out that without investment, it won’t last long.

He says the U.S.’s top export competitor, Brazil, is expected to increase soybean production to 4.7 billion bushels by 2023, with exports expanding by 2.7 billion. However, their infrastructure improvements will lower their freight costs and make them more competitive with the U.S.

The study, “Farm to Market – A Soybean’s Journey”, was funded by the soybean checkoff and performed by Informa Economics.