Portland, OR (September 21, 2021) — The COVID-19 pandemic has illustrated the importance of supply chains in maintaining a strong economy in which consumers have reliable access to food.
While the food supply chain has shown resiliency, disruptions have highlighted the challenges which have had drastic implications for producers, food processors, and distributors. Supply chain disruptions have caused challenges to the efficient flow of import and export containers, which has had reverberating effects widespread across the industry. Shippers have faced significant per diem, detention, and demurrage charges entirely out of their control.
These additional costs ultimately get passed back to producers in the form of lower producer prices. Supply chain disruptions have also caused increased costs related to critical materials and inputs, leading to much longer lead times in procurements.
Columbia Grain International has been cultivating high-quality crops from its network of local farmers to nourish the world safely since 1978. Over the past 12-18 months, CGI has worked with its vast producer network to move their grains and pulses as fast as possible, despite transportation bottlenecks. Decades of experience have enabled CGI to build a steady, reliable, and consistent marketing supply chain for producers across the northern tier of the United States, founded upon the principles of reliability, trust, connectivity, and innovation.
“Our supply chain is compromised and it’s affected both sides of the equation,” said President and CEO of CGI, Jeff Van Pevenage. “Repair, maintenance, and expansion of our facilities have been challenged by slow supply chain delivery of steel, conveyors, legs, motors, and more. CGI steadily attempts to grow our business, but in times like today, the challenges are accelerated. Several projects are delayed due to the lack of equipment available on a timely basis and this results in fewer options for grain movement, storage and segregation through our system.”
Van Pevenage cites transportation as the biggest obstacle. “When the transportation supply chain is compromised, it drastically reduces our industry’s ability to move grain and pulses. When transportation is slowed it reduces and delays our producer’s ability to market their products and receive revenue to pay off their operating loans, suppliers and landlords. It is a huge hit to our system as volume is reduced, and whether people like it or not, we survive on volume times margin. We want to move as much as we possibly can.”
CGI has benefitted from its firm determination to negotiate with transportation companies for alternatives and lower rates, which support producers, the industry, and transportation companies.
Its grain moves primarily though the Seattle and Portland ports via truck, barge, and BNSF rail from Washington, Idaho, Montana, and North Dakota.
Once at the port, it moves via bulk vessel or containers. With container lines showing massive outbound shortages and rail often compromised at the port, its volume looked like would be limited by what was available at its PNW ports.
CGI quickly pivoted to make infrastructure investments, allowing them to diversify their transportation options and even expand, its volume. They went as far as building a container terminal in Plentywood, MT, which enabled them to load containers directly from the plant to decrease the amount of time needed to transport product to the end-user; this includes stockpiling containers to ensure they don’t run out in times of tight supply. T
hese containers then move through Canadian Ports, increasing their options and opening up more competitive rate structures. Their facilities in Ross, ND, Walhalla, WA and Merrifield, ND are now directly loading containers, in volume.
“Our product moves North and South, East and West, but the biggest advantage is that it moves faster and at lower rates to our destinations,” said Van Pevenage. “Our investments and innovative merchandisers allowed these shipping lanes to open and it’s creating more markets for our producers.”
While the entire industry, and CGI, have added more storage space at facilities to allow for larger accumulation of market ready grain, the end result allows transportation to load larger quantities faster.
“Our end goal is to nourish life from our local farmers to the world, and we are working with our transportation companies to ensure that happens in these times of supply chain disruption,” said Van Pevenage.
Since 1978, Columbia Grain International™ (CGI) has been Cultivating Growth™ as a global leader in the origination, processing, logistics, and distribution of high-quality bulk grains, pulses, edible beans, oilseeds and organics for U.S. domestic and worldwide export markets. Headquartered in Portland, OR, CGI’s reliable supply chain spans the western region of the US, ensuring abundant ingredients for all of its partners, thanks to their trusted relationships with their farmers throughout the fertile croplands of Washington, Idaho, Montana and North Dakota, well known for its high-quality wheat, feed grains, canola and pulses. CGI is an owner of Montana Specialty Mills, who operates an organic and non-GMO oilseed crushing facility in Great Falls, Montana, a mustard seed facility in Conrad, Montana, and most recently Montana Craft Malt —providing specialty malt barley from Montana farmers to the craft brewing world. Today, they are vertically integrated, operating assets including grain elevators, processing plants and agronomy centers to support their farmers, which stretch the northern tier of the United States. With multiple touchpoints across the food supply chain, CGI provides trusted solutions and cultivates high-quality ingredients from their local farmers for a farm to table philosophy that nourishes the world, safely.