Semester of Graduation

December 2019

Degree

Master of Science (MS)

Department

Agricultural Economic and Agribusiness

Document Type

Thesis

Abstract

The Mississippi River is an essential asset to agricultural trade given that its existence contributes to a cost-efficient transportation system. Barge travel allows large amounts of soybeans and other bulk commodities to be transported at low costs. Currently, barge costs are the lowest relative to those of other modes. Although there has been increasing competition for soybean shares from other countries in the global market, low transportation costs of soybeans, grain, and other oilseed crops allow the United States to retain its competitive advantage in the world soybean market. The Mississippi River’s urgency to change course and possibly eliminate barge travel to the New Orleans Gulf Port Region puts this advantage into jeopardy. By using transportation costs of specific modes and routes to port of import destinations, the economic impact of a Mississippi River avulsion, the natural displacement of an established river channel, on soybean exports to foreign countries was estimated. Results of a network optimization model indicate that a change in the river’s course would lead to a 23.86 to 25.27 percent increase in total transportation costs of shipping soybeans to China and Japan. This cost increase has several implications which include the future competitiveness of United States agricultural trade following an avulsion and recommendations for additional investments in Mississippi River channel preservation to reduce the risk of a potential avulsion.

Committee Chair

P. Lynn Kennedy

DOI

10.31390/gradschool_theses.5042

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