The average price to ship a 40-ft container ship has more than quadrupled over the past year, according to a recent global pricing index by Drewery Shipping Consultants, Ltd. (Photo: Brock Johnston/Iowa Soybean Association)
Cargo Preference Hinders Iowa Farmers’ Ability to Reduce Food Insecurity
May 20, 2022 | Brock Johnston
Invoking cargo preference waiver would accelerate delivery of food and lower transportation costs
Ankeny, Iowa – Legislative action seeking to waive preference requirements on food assistance to Ukraine would expedite delivery of U.S. food aid exports, including Iowa-grown soybeans.
Cargo Preference for Food Aid (CPFA) requirements compel 50% of Title II food aid shipments (by tonnage) to be carried on U.S. flagged vessels. Sens. Joni Ernst (R-Iowa) and Chris Coons (D-Delaware) introduced a Concurrent Resolution May 3 seeking to waive preference requirements on food assistance. If agreed to in both chambers of Congress, the waiver would expire February 2025, three years after Russia’s invasion of Ukraine.
“With a record soybean harvest in 2021, growers continue to play a leading role in addressing food insecurity by providing a reliable source of high-quality protein, ” said Iowa Soybean Association (ISA) President Robb Ewoldt, a soybean farmer near Davenport. “Ensuring our homegrown soybeans reach the people who need them in an efficient, cost-effective way must be a priority.”
Cargo preference has long been criticized for inflating shipping costs far beyond the value of food commodities onboard vessels. Recently, the U.S. Department of Agriculture (USDA) said it would need to spend $388 million to transport and distribute $282 million worth of U.S. commodities, including soybeans, to Yemen and five African countries. A report released by the American Enterprise Institute (AEI) found CPFA requirements increased food aid shipping costs by an average of $52.6 million per fiscal year between 2013 and 2018.
ISA, alongside many state and national commodity organizations, opposes cargo preference requirements which jeopardize U.S. agricultural exports to food insecure regions of the world.
“We thank Sen. Ernst for her leadership in bringing this issue before the U.S. Senate, as well as the bipartisan coalition of lawmakers seeking to move this waiver forward,” said Ewoldt. “Iowa soybean farmers look forward to the waivers’ swift implementation through this Concurrent Resolution.”
Not funded by the soybean checkoff
The Iowa Soybean Association (www.iasoybeans.com) is “Driven To Deliver” increased soybean demand through market development and new uses, farmer-focused research and results, timely information and know-how and policy initiatives enabling farmers and the industry to flourish. Founded in 1964 by farmers to serve farmers, ISA is governed by a board of 22 farmers to advocate on behalf of the state’s 40,000 soybean producers, including more than 12,000 ISA farmer members and industry stakeholders.