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The Cost-Effective Movement of Cargo ~ Inland Waterways

The Cost-Effective Movement of Cargo ~ Inland Waterways


Inland Waterways ~ A Role in the Nation’s Economy

Moving Cargo Cost-Effectively

Inland waterways provide the vital, safe, and cost-effective transportation of raw materials and goods. All told, 38 states directly benefit from inland waterways and the movement of goods on this system.  Some features of the inland waterways include:

  • Comprised of 12,000 miles of navigable waters
  • Includes more than 240 locks
  • More than 566 million tons of goods and commodities moved in 2013
  • 346 tons of which were moved from inland waterways to ports for export
  • Valued at over $216 billion dollars
  • Vessels carry the equivalent of 51 million overland truck trips annually

Helping Provide Energy and Decreasing Demands on Surface Transportation Infrastructure

As part of the nation’s transportation infrastructure, inland waterways have been a vital part of delivering the nations goods at an economically sound cost, especially for oversized or overweight freight.  

In addition, these waterways provide delivery of the nation’s energy needs, including coal (20%), petroleum, and petroleum products (22%) in addition to chemicals, iron, steel, and intermodal containers.

If trucks were used to carry the cargo currently shipped on barges, the number of vehicles added to interstates and local roadways would increase exponentially.  Inland waterways ease surface transportation demands including roadway congestion, load capacity on bridges, and  lessen roadway impacts by not adding wear and tear to surfaces, preventing an increase in costs for required repairs or maintenance.

Impacts on Inland Waterways from the Expanding Global Economy

More than 60% of the country's grain is moved by barges through inland waterways for export, helping the nation compete in the global export market.  To accommodate the growing need for these commodities and to provide cost-effective transportation in today’s global economic environment, vessel sizes have increased more than 9% with the anticipated Panama Canal expansion, putting new demands on large and small ports and inland waterways.  In addition, many of the new barges are also too large to fit through the older and aging locks.

Currently, many of the navigation channels that lead into east coast ports are unable to accommodate the 45 foot draft of the new ships, and delays due to service interruptions of failing or degraded locks or dams account for hundreds of millions of dollars in losses annually.  According to the ASCE, an approximate $900 million dollars annually is required to invest in projects to improve inland waterways and ports, including dams and locks, in order to maintain the nation’s competitive viability in the global market.

In addition, ASCE is anticipating an increase of nearly 11% of traffic on the nation's inland waterways by 2020, or more than 51 million tons of cargo.  The ability to move this freight efficiently and effectively will impact almost every sector of the nation’s economy, including energy generation, food supplies, and exports, so looking ahead at future potential problems or outcomes is also a good idea.

Investment Needed for an Interconnected System

It should come as no surprise then, that inland waterways are often directly dependent on the nation’s ports – and vice versa – for both import and export abilities, interconnecting the two systems.  As a result of the expanding trade, and yes, the Panama Canal expansion, the need to address growing deficiencies in these two systems is vital to the nation’s economic health.

Unfortunately, funding has not changed much in the last twenty years – even though projects often exceed expected timelines, leading to cost overruns, something the industry can ill afford.  Barge operators saw the need for an increase in funding and voiced a willingness to pay more than the then current $.20 cents per gallon on fuel to help cover the costs of needed maintenance, repairs, upgrades, or replacements.  This increased funding was approved in 2014 at an additional $.09 cents per gallon.  Although the extra funding has helped considerably, project delays still need to be brought under control to avoid absorbing those extra funds in cost overruns.  Currently, the Inland Waterways Users Board is working diligently to help contain this issue, but more work remains to be done.

Public-Private Partnerships and Key Stakeholders Needed

To further address issues with the inland waterways, the ASCE also proposes a three step process, one of which is to engage key stakeholders in a national freight strategy that includes shipping companies, manufacturer’s, and retailers and covers all modes of transportation, likely helping to streamline the entire system.

It seems like a pretty good idea, especially since all modes are interconnected anyway.  The use of public-private partnerships might also be a key to maintaining and repairing systems more quickly and efficiently, as the entire inland waterway system would likely benefit from advanced technologies in the private sector.  It might help with project delays and cost overruns, too.

Inland Waterways: A Vital Component

Inland waterways play a vital role in the nation’s infrastructure and their efficient and effective operations are key factors in maintaining a viable position in today’s global economy.

The unimpeded movement of raw materials and goods for consumption and export cannot happen without significant attention to this system and its many needs, including the important role of a smooth functioning lock system – something that will be explored in the next blog on this important topic.

Photo Credit: Photo by Tim Kiser / CC BY-SA 2.0

American Military University


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