Graduation date: 1985

The Canadian grain trade is faced with the prospect of change. It is therefore important to analyze the system for current efficiency and for efficiency under alternative configurations of physical facilities, alternative methods of operating, and alternative regulations. This study is concerned with a somewhat narrow subject, that of grain movement from the farm to elevator. Total costs associated with the assembly of grain were estimated at six elevator points: for the current configuration of facilities, after changes in number and capacity of elevators, after changes in farm storage capacity, after changes in hauling distance and truck size, and after changes in elevator location. The technique of simulation was used, and a model was constructed to provide a simulator of the system. The model was by necessity, simple, incorporating data to represent crop production, farm storage cost, ground storage cost, hauling cost, elevator cost, and rail shipments. Each change necessitated an additional computer run to determine the costs resulting from the change. It was concluded that a model using the technique of simulation could be constructed for the entire grain marketing system to capture the essence of the interdependencies. Ten experiments were conducted to estimate the costs associated with alternative configurations. The resulting estimates indicated that the current configuration is inefficient and that lower costs would occur following: (1) reduction in the number of elevators at each point, (2) a reduction in the number of points, (3) a reduction in farm storage capacity, and (4) by an increase in farm truck size. The cost of assembling grain with the current configuration was estimated to be 24.38 cents per bushel. It is possible given the validity of the model to reduce these costs to 13.76 cents per bushel by decreasing the number of elevators at each point, reducing farm storage capacity, and increasing farm truck size. The complete response surface was not mapped because of the great number of potential permutations, hence only ten discrete experiments were completed. However, indications were that one of the more important ways to achieve a lower per bushel cost of assembly is to increase the volume of grain through a fixed capacity country elevator system. It is important to examine these results in terms of the limited scope of the study for not all costs were accounted. That is, there may be external costs to the rest of the economy due to interdependence. / Land and Food Systems, Faculty of / Graduate

The Crowsnest Pass rates are fixed rail freight rates that apply on the carriage of most Canadian grain. They were originally established in 1897, and have been embodied in Federal statute since 1925. In recent years, the rates have covered less than 40 percent of rail-grain costs. With continuing cost inflation, this proportion will decrease to even lower levels over time. Several policy alternatives are available to the Federal Government with respect to the transportation of grain by rail. These alternatives are characterized primarily by different freight rate levels. The lowest rate level considered herein is the current one; the highest is a level at which the railways would recover the long-run variable costs of the rail-grain system plus a contribution to their constant costs. For each price-level alternative, there are a range of subsidy alternatives. Depending on the particular price level, subsidies could be given to the railways, the grain producers, neither of these, or both of them. In order to evaluate the policy alternatives, there must be criteria for evaluation. The criteria used in this thesis are the major objectives that relate to the issue. Two of the objectives are to improve economic efficiency and to facilitate the development of secondary industry in the Prairie provinces. Both of these objectives favour the pricing alternative of raising grain freight rates to a compensatory level. Without producer subsidies, however, this alternative violates a third objective--that of minimizing grain-producer transportation costs. In addition to these three objectives, there are four objectives that refer particularly to the Federal Government. They are maximizing votes, implementing the "user pay" philosophy, minimizing total subsidy payments, and assisting railway variable-cost recovery in grain transport. A major consideration that is not an objective is the resistance of producers to direct, rather than indirect, subsidies. The quantitative impacts of raising rail-grain rates on the railways and on grain producers are substantial. Implementing rail freight rates equal to the long-run variable costs of transporting grain would have increased the combined net revenue of the Canadian National Railways and CP Rail by at least two-thirds in 1976. It would have decreased the net income of Prairie grain farms by (at most) 15 percent in the same year. Two policy alternatives are chosen as the better alternatives. The first policy selected is that of initial Crowsnest Pass rates, increasing over time to a larger and larger proportion of rail-grain costs. This pricing scheme would be accompanied by constant railway subsidies to reflect the difference between costs and revenues. The second policy is an immediate increase to rates covering variable costs, with subsequent annual increases to adjust for inflation. With this pricing policy, there would be constant producer subsidies equal to the initial rate increase. / Business, Sauder School of / Graduate

No description available.

Call number: LD2668 .T4 1958 R45

This dissertation investigated issues surrounding grain harvest and transportation logistics. A discrete event simulation model of grain transportation from the field to an on-farm storage facility was developed to evaluate how truck and driver resource constraints impact material flow efficiency, resource utilization, and system throughput. Harvest rate and in-field transportation were represented as a stochastic entity generation process, and service times associated with various material handling steps were represented by a combination of deterministic times and statistical distributions. The model was applied to data collected for three distinct harvest scenarios (18 total days). The observed number of deliveries was within ± 2 standard deviations of the simulation mean for 15 of the 18 input conditions examined, and on a daily basis, the median error between the simulated and observed deliveries was -4.1%. The model was expanded to simulate the whole harvest season and include temporary wet storage capacity and grain drying. Moisture content changes due to field dry down was modeled using weather data and grain equilibrium moisture content relationships and resulted in an RMSE of 0.73 pts. Dryer capacity and performance were accounted for by adjusting the specified dryer performance to the observed level of moisture removal and drying temperature. Dryer capacity was generally underpredicted, and large variations were found in the observed data. The expanded model matched the observed cumulative mass of grain delivered well and estimated the harvest would take one partial day longer than was observed. Usefulness of the model to evaluate both costs and system performance was demonstrated by conducting a sensitivity analysis and examining system changes for a hypothetical operation. A dry year and a slow drying crop had the largest impact on the system’s operating and drying costs (12.7% decrease and 10.8% increase, respectively). The impact of reducing the drying temperature to maintain quality in drying white corn had no impact on the combined drying and operating cost, but harvest took six days longer. The reduced drying capacity at lower temperatures resulted in more field drying which counteracted the reduced drying efficiency and increased field time. The sensitivity analysis demonstrated varied benefits of increased drying and transportation capacity based on how often these systems created a bottleneck in the operation. For some combinations of longer transportation times and higher harvest rates, increasing hauling and drying capacity could shorten the harvest window by a week or more at an increase in costs of less than $12 ha-1. An additional field study was conducted to examine corn harvest losses in Kentucky. Total losses for cooperator combines were found to be between 0.8%-2.4% of total yield (86 to 222 kg ha-1). On average, the combine head accounted for 66% of the measured losses, and the total losses were highly variable, with coefficients of variation ranging from 21.7% to 77.2%. Yield and harvest losses were monitored in a single field as the grain dried from 33.9% to 14.6%. There was no significant difference in the potential yield at any moisture level, and the observed yield and losses displayed little variation for moisture levels from 33.9% to 19.8%, with total losses less than 1% (82 to 130 kg dry matter ha-1). Large amounts of lodging occurred while the grain dried from 19.8% to 14.6%, which resulted in an 18.9% reduction in yield, and harvest losses in excess of 9%. Allowing the grain to field dry generally improved test weight and reduced mechanical damage, however, there was a trend of increased mold and other damage in prolonged field drying.

Grain shippers are constantly faced with making merchandising and logistical decisions while trying to achieve a positive net margin. They have to decide how much grain to sell and when the most opportune time to do so occurs. In addition, decisions regarding how much freight should be acquired and where grain should be shipped need to be addressed. These decisions are met by several sources of risk such as futures spreads, basis levels, transit times, equipment placements, and farmer deliveries. The primary objective of this thesis was to develop a model to determine both the optimal amount of grain that should be sold in the pipeline and the optimal amount of freight that should be hedged by grain shippers through the use of forward shipping mechanisms. Certificates of Transportation (COTs) offered by the Burlington Northern Santa Fe (BNSF) Railway were used to represent forward shipping mechanisms in this thesis. A stochastic simulation model of a prototypical grain shipper containing three country elevators and two export facilities was developed. A sensitivity analysis was conducted on merchandising and logistical variables to evaluate different scenarios. The analysis revealed that committing to too many shuttle COTS limited the shipper's flexibility, forced sales to be made in suboptimal periods, and significantly increased the level of demurrage. The type of freight ordering strategy implemented by each elevator ultimately determined the overall sustainability of the firm; shippers need to diversify the type of freight they commit to because ordering too much long-term freight can result in bad sales decisions, whereas relying only on short-term freight is costly and inefficient. Not being able to quickly adapt to volatile market conditions can result in making bad selling decisions and untimely freight purchases which can hinder the longevity of a firm.

Agriculture is an important industry in Virginia, with an array of crops grown and animals produced. Virginia's crop, livestock, and poultry sectors sold agricultural products worth $1.4 billion and $2.4 billion, respectively, in 2012. One of the products, grain, serves as an important input for raising livestock and poultry. Virginia needs to import grain from other states (Eastern Corn Belt states) to meet current livestock feed requirements, an expense that raises the cost of production over locally sourced grains . Further, such movements of grain from producing-areas to demand-areas rely on the efficient and timely interaction of grain storage and transportation. Describing the details of the grain supply chain provides insights into the interplay and relationships among production, storage, transportation, and end users of grains and oilseeds in Virginia. Results of a state-wide survey of Virginia grain producers shed light on the following topics: current cropping practices; current grain storage practices; available farm-level storage and its use, age, and expected life; and future storage plans and constraints. Overall findings include, grain production in Virginia has generally increased over the last decade, yet storage capacity remains constant and continues to age; livestock and poultry populations are declining leading to less demand for feed grains and oilseeds; grain farmers report satisfaction with their current storage situation and higher returns to stored grain may encourage "non-storers" to build storage; and the majority the grain leaving the farm is hauled by truck over short distances (25 miles or less). Overall, the results provide a foundation for understanding the grain supply chain in Virginia and offer useful information to Virginia's agricultural stakeholders. / Master of Science

The problems associated with increased heavy grain truck traffic in rural regions were investigated. Both the short-run incremental costs of accelerated pavement replacement and the long-run incremental costs of upgrading low-volume highways were considered. A set of demand and traffic models was formulated which projects the annual flow of grain from each production zone in an impact region to each elevator, allocates the flows among truck-types, computes the annual trips, gross vehicle weights and axle weights, and assigns the truck trips to the highway network. A set of highway models was also formulated which computes the equivalent single axle loads for each highway section in an impact region and estimates the incremental costs associated with subterminal traffic. The impacts of a newly-formed subterminal-satellite elevator system in rural North Dakota were investigated. The results of the case study indicate that rural collector highways are likely to experience substantial localized impacts from subterminal development but the effects on principal arterials may be minimal. Altogether, $1.14 million in short-run costs and $8.41 million in long-run costs were projected for the impact region. However, the case study roads represent less than 2 percent of the rural arterial and collector highway mileage in the state. If the case-study network represents a microcosm of rural North Dakota, then the statewide short-run and long-run incremental costs may be in the vicinity of $57 million and $420 million respectively. However, regional variations within the state may result in either higher or lower costs for a given elevator system than those projected in the case study. / Ph. D.

Although the original intent of this study was to do a pre-and post-deregulation assessment of rail rates per ton-mile, the results using post-deregulation data show a significant decrease in rail rates between 1981 and 2000. While accounting for changes in shipment characteristics, savings for wheat, barley, com, oat, and soybean shippers were 63.80%, 69.17%, 49.07%, 67.97%, and 59.36%, respectively. Rate savings over time for an average 1981 shipment were 45%, 55%, 38%, 45%, and 36% for wheat, barley, com, oat, and soybean shippers, respectively. Analysis regarding the effects of deregulation of rail rates on com, soybean, and wheat on a regional basis shows that rail rates not only differ across commodities, but also among regions. In general, it was found that grain producers within regions that had higher levels of intermodal competition had lower rates than their counterparts with lower levels of intermodal competition. Distribution of benefits as a result of market-based pricing has varied among regions, and these variances are increasing over time.