Iowa State University Capstones, Theses and Retrospective Theses and Dissertations Dissertations 1958 Economic aspects of grain storage in North Central United States Kenneth Royden Farrell Iowa State College Follow this and additional works at: https://lib.dr.iastate.edu/rtd Part of the Agriculture Commons Recommended Citation Farrell, Kenneth Royden, "Economic aspects of grain storage in North Central United States " (1958). Retrospective Theses and Dissertations. 1628. https://lib.dr.iastate.edu/rtd/1628 This Dissertation is brought to you for free and open access by the Iowa State University Capstones, Theses and Dissertations at Iowa State University Digital Repository. It has been accepted for inclusion in Retrospective Theses and Dissertations by an authorized administrator of Iowa State University Digital Repository. For more information, please contact [email protected]. ECONOMIC ASPECTS OF GRAIN STORAGE IN NORTH CENTRAL UNITED STATES by Kenneth Royden Farrell A Dissertation Submitted to the Graduate Faculty in Partial Fulfillment of The Requirements for the Degree of DOCTOR OF PHILOSOPHY Major Subject: Agricultural Economics Approved: Signature was redacted for privacy. Signature was redacted for privacy. Head of Major Department Signature was redacted for privacy. been or uraanate uo.LJ.ege Iowa State College 1958 ii TABLE OF CONTENTS Page I. INTRODUCTION 1 A. Statement of the Problem 3 B. Objectives 6 C. Scope of Analysis 7 D. Definitions and Sources of Data 8 II. ECONOMIC FRAMEWORK 12 A. The Economic Model 12 B. Application of Mathematical Programming 19 III. DISTRIBUTION, SUPPLY AND REQUIREMENTS OF GRAIN 25 A. Selection of Regions for Study 25 B. Distribution of Grain 29 C. Supply of Grain ijb D. Grain Requirements 55 IV. STORAGE CAPACITY AND COSTS 65 A. Location of Storage Facilities 65 B. Length of Storage 73 C. Storage Costs 76 V. TRANSPORTATION OF GRAIN 92 A. Transportation by Type of Carrier 92 B. Grain Freight Rate Structure 101 C. Interregional Transportation Costs 107 VI. PROGRAMMING METHOD AND RESULTS 116 A. Formulation of Programs 116 B. Programming Results 120 VII. IMPLICATIONS OF ANALYSES 148 A. Canparisons of Grain Shipping Patterns 148 B. Comparisons of Grain Storage Patterns 163 VIII. CRITIQUE 177 A. Analytical Framework 177 B. Analytical Technique 185 3X. SUMMARY AND CONCLUSIONS 188 iii TABLE OF CONTENTS (Continued) Page A. Summary 188 B. Conclusions 196 X. LITERATURE CITED 200 XI. ACKNOWLEDGMENT 202 iv LIST OF TABLES Production, farm sales and receipts of wheat at country elevator, terminal elevator and wholesale grain processing plants, North Central United States 31 Production, farm sales and receipts of com at country elevator, terminal elevator and wholesale grain processing plants, North Central United States 32 Production, fann sales and receipts of soybeans at country elevator, terminal elevator and wholesale grain processing plants, North Central United States 33 Production, farm sales and receipts of oats at country elevator, terminal elevator and wholesale grain processing plants, North Central United States 34 Production, farm sales and receipts of barley at country elevator, terminal elevator and wholesale grain processing plants, North Central United States 35 Production, farm sales and receipts of grain sorghum at country elevator, terminal elevator and wholesale grain processing plants, North Central United States 36 Estimated shipments of wheat from country elevator, terminal elevator and wholesale grain processing plants, North Central United States, 1954 38 Estimated shipments of com from country elevator, terminal elevator and wholesale grain processing plants, North Central United States, 1954 39 Estimated shipments of soybeans from country elevator, terminal elevator and wholesale grain processing plants, North Central United States, 1954 AO Estimated shipments of oats from country elevator, terminal elevator and wholesale grain processing plants, North Central United States, 1954 41 Estimated shipments of barley from country elevator, terminal elevator and wholesale grain processing plants, North Central United States, 1954- 42 Estimated shipments of grain sorghum from country elevator, terminal elevator and wholesale grain processing plants, North Central United States, 1954 43 V LIST OF TABLES (Continued) Page Table 13 Estimated primary supply of wheat by region, North Central United States, 1954 49 Table 14- Estimated primary supply of com by region, North Central United States, 1954 50 Table 15 Estimated primary supply of soybeans by region, North Central United States, 1954 51 Table 16 Estimated primary supply of oats by region, North Central United States, 1954 52 Table 17 Estimated primary supply of barley by region, North Central United States, 1954 53 Table 18 Estimated primary supply of grain sorghum by region, North Central United States, 1954 54 Table 19 Estimated requirements of wheat by region, North Central United States, 1954 56 Table 20 Estimated requirements of corn by region, North Central United States, 1954 57 Table 21 Estimated requirements of soybeans by region, North Central United States, 1954 58 Table 22 Estimated requirements of oats by region, North Central United States, 1954 59 Table 23 Estimated requirements of barley by region, North Central United States, 1954 60 Table 24. Estimated requirements of grain sorghum by region, North Central United States, 1954 61 Table 25 Estimated requirements of six types of grain, in regions other than North Central United States, 1954 64 Table 26 Number and storage capacity of commercial grain mar­ keting plants, North Central United States, 1954- 67 Table 27 Selected statistics relating to storage capacity of country elevator, terminal elevator and wholesale grain processing plants, North Central United States, 1954 69 vi LIST OF TABLES (Continued) Page Table 28 Selected statistics relating to storage capacity of country elevator plants, North Central United States, 1954 71 Table 29 Selected statistics relating to storage capacity of terminal elevator and wholesale grain processing plants, North Central United States, 1954 72 Table 30 Average length of storage of six types of grain stared in country elevator, terminal elevator and wholesale grain processing plants, North Central United States, 1954 75 Table 31 Estimated average annual variable costs of storage in country elevator, terminal elevator and wholesale grain processing plants, North Central United States 88 Table 32 Percent of grain received at country elevators by truck frcm other grain handlers, North Central United States, 1954 94 Table 33 Percent of grain shipped from country elevators by rail, North Central Uhited States, 1954 95 Table 34 Percent of grain received at terminal elevator and wholesale grain processing plants, North Central United States, 1954 98 Table 35 Percent of grain shipped by rail from terminal elevator and wholesale grain processing plants, North Central United States, 1954 100 Table 36 Wheat freight rates between selected origins and destinations, Uhited States 109 Table 37 Corn freight rates between selected origins and destinations, Uhited States 110 Table 38 Soybean freight rates between selected origins and destinations, United States 111 Tabla 39 Oats freight rates between selected origins and destinations, United States 112 Table 40 Barley freight rates between selected origins and destinations, United States 113 vii LIST OF TABLES (Continued) Page Table 41 Grain sorghum freight rates between selected origins and destinations, United States 11/, Table 42 Sources of freight rate data 115 Table 43 Supply, requirements and initial interplant allocation of wheat storage stocks, North Central United States, 1954 123 Table 44 Average transfer costs in the shipment of wheat from Missouri to specified destinations 125 Table 45 Least cost shipping-storage pattern for wheat, 1954 133 Table 46 Least cost shipping-storage pattern for com, 1954 136 Table 47 Least cost shipping-storage pattern for soybeans, 1954 138 Table 48 Least cost shipping-storage pattern for oats, 1954 140 Table 49 Least cost shipping-storage pattern for barley, 1954 141 Table 50 Least cost shipping-storage pattern for grain sorghum, 1954 142 Table 51 Excess stocks of six types of grain, North Central United States, 1954 143 Table 52 Net storage capacity by type of plant, North Central United States, 1954 145 Table 53 Least cost storage pattern of excess stocks of six types of grain, North Central Uhited States, 1954 146 Table 54 Actual and predicted wheat shipments, 1954 151 Table 55 Actual and predicted com shipments, 1954 155 Table 56 Actual and predicted soybean shipments, 1954 158 Table 57 Actual and predicted oat shipments, 1954 160 Table 58 Actual and predicted barley shipments, 1954 162 Table 59 Actual and predicted grain sorghum shipments, 1954 163 viii LIST OF TABLES (Continued) Page Table 60 Least cost location of grain storage stocks and utilization of storage facilities by type of plant, North Central United States, 1954 166 Table 61 Distribution of grain storage stocks, actual and predicted, by type of grain, North Central Uhited States, 1954- 175 ix LIST OF FIGURES Page Figure 1 Selected grain shipping and receiving regions of the Uhited States 27b Figure 2 Average total and variable storage costs in four elevators 83 1 I. INTRODUCTION Considerations of aggregative resource use in the storage of grain have revolved about two basic questions: (l) what is the optimum level of interseasonal grain storage stocks? (2) what is the optimum