Logistic Barriers to U.S.–Mexico Grain and Soybean Trade

Fourteen years after the implementation of the North American Free Trade Agreement (NAFTA), border-crossing restrictions still remain with Mexico. Although studies have analyzed the impact of NAFTA trade liberalization, there has only been limited research on effects of informal trade barriers on U.S.–Mexico grain and soybean flows. This paper quantitatively measures the impact of logistic barriers impeding U.S.–Mexico grain and soybean trade. A conditional model testing for the presence of asymmetries in grain trade suggests that logistic barriers and transshipments are correlated. Econometric analysis rejects the null hypoInternational Relations/Trade,

Impact of Panama Canal Expansion on the U.S. Intermodal System

The Panama Canal expansion is expected to affect global transportation trade routes. The Panama Canal’s main competitors for shipments from Asia to the U.S. East Coast are the U.S. Intermodal System and the Suez Canal. The Panama Canal is an efficient route, but is reaching its maximum capacity. However, this problem will be resolved by 2014 when the Panama Canal Expansion Project is completed. The Suez Canal route, especially, competes with the Panama Canal in the South and Southeast Asia–U.S. East Coast route due to its shorter navigation time of 21.1 days and its capacity to handle Post-Panamax vessels. The U.S. Intermodal System has the shortest ocean navigation time (Asia to U.S. West Coast) of 12.3 days. Transit time from the West Coast to the East Coast is another 6 days, for a total transit time from Asia to the East Coast of about 18.3 days. However, the reliability of ports and railroads frequently is compromised by labor problems and capacity expansion challenges. For the U.S. Intermodal System to remain competitive in the face of the Panama Canal expansion, further investment in U.S. infrastructure and a more integrated approach is needed to reduced bottlenecks in the system

The Potential Impact of Brazil’s Transportation Efficiencies on World Cotton Trade

This paper is a summary of: Rafael de Farias Costa, C. Parr Rosson, III, and Flynn J. Adcock, Transportation Infrastructure in Brazil: Impacts and Implications for Global Cotton Trade, Texas A&M, CNAS 2012-0. May 2012. Web. Brazil is the third largest cotton exporter after the United States and Uzbekistan. Cotton production in Brazil expanded from 2 million bales in the late 1990s to about 9.3 million bales in 2011. In 2007, Brazil began a comprehensive logistical investment plan to increase competitiveness in the world agricultural market. To increase transportation efficiencies, the Brazilian Government wants to reduce export route distances and port congestion by shifting exports from the southern ports to the north and northeast port regions. Texas AgriLIFE Research scientists estimated the impact of Brazil improvements in transportation infrastructure on cotton production, prices, and exports. Transportation costs for different regions within Brazil were estimated to reflect movements from mill to port. An origin-destination matrix of the Brazilian cotton industry that tracks cotton flows within the country was developed and validated. Findings indicate that a 2- to 3-percent transportation cost reduction would not have a significant impact on the world cotton trade. However, the United States may benefit slightly Brazil main cotton export routes from a 2-percent cost reduction, increasing exports by 640 bales, raising prices 2 cents a bale, and growing revenue by $457,900. If transportation costs drop by 10 percent, Brazilian exports could increase by 64,830 bales, raising prices by$3.61 per bale and increasing revenue by $27.8 million. India and the United States might lose market share. U.S. losses could include 4,490 fewer bales exported at a price of$0.28 less per bale and lower cotton export revenues of $5.7 million

Logistic Barriers to U.S.–Mexico Grain and Soybean Trade

Fourteen years after the implementation of the North American Free Trade Agreement (NAFTA), border-crossing restrictions still remain with Mexico. Although studies have analyzed the impact of NAFTA trade liberalization, there has only been limited research on effects of informal trade barriers on U.S.–Mexico grain and soybean flows. This paper quantitatively measures the impact of logistic barriers impeding U.S.–Mexico grain and soybean trade. A conditional model testing for the presence of asymmetries in grain trade suggests that logistic barriers and transshipments are correlated. Econometric analysis rejects the null hyp