Minnesota freight market profiled in new paper

Driver at the steering wheel of a semi truck, with a view of the freeway through the windshield

Photo: Shutterstock

Performance of the freight system in Minnesota profoundly affects economic competitiveness. But perspectives vary on what constitutes and contributes to an attractive, competitive freight environment. Differences among various interests—carriers, retailers, consumers, and government—give rise to a certain competitive tension underlying critical decision making and investment involving freight.

To make sense of it all, the Minnesota Freight Advisory Committee (MFAC) in June published Components of an Attractive Minnesota Freight Market (PDF). The white paper, which identifies key aspects of an attractive freight market in Minnesota, is the first in a planned MFAC series about freight transportation issues important to Minnesota’s economy.

“We need to take a hard look at some of the key components that truly make up the freight industry and how this ties into overall transportation infrastructure and competitiveness of markets,” says MFAC chair Bill Goins. “This paper highlights the unique perspectives, issues, and needs of all freight market contributors—air, pipeline, producers, rail, trucking, and water.”

MFAC turned to the University of Minnesota for expertise to sort out the important issues of the Minnesota freight market and its diverse and complex stakeholders. Humphrey School researcher Matt Schmit authored the paper with guidance from an MFAC subcommittee that included MFAC members and staff from MnDOT and CTS.

“Freight plays such an incredible role in our economy. If we’re able to foster a dialogue where more people understand what’s important—what matters most—the better off we’re going to be,” Schmit says. “We wanted to make this accessible to policymakers and other constituencies, including the public.”

Schmit’s findings are based on a thorough literature review of the topic and interviews with approximately 30 key stakeholders in Minnesota’s freight industry, including producers that grow, manufacture, and ship product; carriers in trucking, rail, air, and water-based transportation modes; third-party logistics firms that track and contract shipping routes to the nearest nanosecond; and regulators and planners at various levels of government.

Based on conversations with various interests, key components of an attractive Minnesota freight market include:

  • Increasingly efficient supply-chain management
  • Stronger balance between inbound and outbound freight movement
  • Additional options for shippers, including improved access to rail and, to a lesser extent, water modes through new or improved intermodal terminals
  • Sufficient investment in transportation infrastructure and congestion mitigation
  • Improved career pathways and geographically balanced labor supply
  • Consistent regulation and policies that promote technology adoption, public-private partnerships, and private investment

Finally, according to Schmit, external factors—such as shifting port activity due to the widening of the Panama Canal, impacts from global climate change, and rapid technological advances in vehicle automation, including the potential for self-driving trucks—present a mix of challenges and opportunities as freight shippers and carriers respond to changing realities and pressures in a highly competitive freight market.

The white paper, intended as a foundation for subsequent papers focused on critical Minnesota freight issues, represents a new era for MFAC and freight in Minnesota. In 2016, MFAC introduced strategic organizational changes in conjunction with the development of the Minnesota Statewide Freight System Plan. The goal is to increase awareness of freight issues locally and nationally, facilitate quick response to freight questions and issues from the Minnesota Legislature and other organizations, and provide a focal point for freight expertise in Minnesota.

Posted in Economics, Freight, Transportation research

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