Major infrastructure investments at the port of Grays Harbor in Aberdeen, Wash., will help improve the efficiency of getting product to market and expand soybean meal exports.
Additional export markets are needed for U.S. meal as it will soon become a byproduct of soybean processing as new plants come online to meet the growing demand for soybean oil for use in renewable fuels according to Mac Marshall, vice president of market intelligence with the United Soybean Board.
“We’re looking at roughly a 30% expansion maybe a shade higher than that, in the U.S.,” Marshall says. “We’ve not had a wave of expansion like this of this magnitude, I think, at any point. This is truly a historical transformational period for the U.S. soybean processing industry.”
Gary Nelson, executive director of the Port of Grays Harbor, says that’s also driving the current expansion and investment at the port with soy processor AGP.
“AGP has worked on a new ship loader and dump buildings, so we’re making enhancements to the dock by adding fender systems and a new stormwater system to ensure that the running stormwater runoff is not going to harm any of our fish and in our environment here in Grays Harbor,” Nelson says.
The port has also invested in dredging and the third addition to the rail line since 2000.
“We’re going to add another 50,000' of rail on dock rail, and it will probably be in the $30 to $35 million range,” Nelson adds.
The United Soybean Board and soybean producer groups in the northwestern Corn Belt have also contributed to infrastructure feasibility studies to aid the project.
“We’ve helped to bring the engineering and the planning and all of that up as far as Port of Grays rebuilding and improving their facility helping to increase their capacity and what they can receive and what they can ship out,” says Belinda Burrier, USB director and Maryland farmer.
And that will greatly enhance port capacity and ramp up exports of meal to Southeast Asian customers.
“It’ll basically double it,” Nelson says. “It’ll go from two and a half to three million to probably six plus million tons on an annual basis.”
Marshall says that is a gamechanger.
“When you consider the volume of meals online,” he says, “on the level of crushing capacity expansion and having a channel for an additional 3 million tons is absolutely critical for ensuring that we have connectivity between our production supply side of the market and our buyers overseas.”
Construction is currently underway with a target for competition in early 2025. This project will pay big dividends for farmers.
“As we have increased economies of scale for export and improved infrastructure for bringing soy to elevators and soymeal from the elevator to the port,” Marshall says, “investment toward that all means dollars back in farmers’ pockets. When you have more efficient transportation, you don’t have the same hit that you take on basis.”
And Burrier agrees, “It should help basis even for me. I’m from the state of Maryland, and it’s going to help my basis just as well because the market is a world market. It’s not just the local market anymore.”
Burrier says investments in not only Grays Harbor but other infrastructure projects are critical as the U.S. grain transportation system is aging.
“The United Soybean Board is behind build rebuilding the infrastructure system across the U.S. because it helps us to be more reliable on our infrastructure moving the soybeans from the farm down to the final customer,” she says.
This also keeps U.S. farmers more competitive globally.
