Rain during the first half of June caused high water levels on the Mississippi River. Extreme rain events have caused river level fluctuations throughout the central United States. The U.S. Army Corps of Engineers, St. Paul District, closed three Minneapolis locks to commercial navigation on June 16.
This is the fourth time this season that the three Minneapolis locks — Upper and Lower St. Anthony Falls locks and dams and Lock and Dam 1 — have been closed to commercial navigation because of water conditions.
River levels came within 4 feet of flood stage on June 12 in St. Louis, Mo.; however, water levels there have since receded. Delays are slowing barge traffic at Melvin Price Locks and Dam, near St. Louis, until repairs can be completed in mid-August.
Nevertheless, grain barge tonnages are up from last year, when quantities of grain were reduced by the 2012 drought.
Soybean Inspections Rebound
For the week ending June 12, total inspections of soybeans totaled .224 million metric tons (mmt), up 73 percent from the past week and 215 percent above the same time last year.
Soybean inspections increased in the Mississippi Gulf and the Interior, with increased shipments to Asia and Mexico. Inspections of wheat and corn, however, were down 24 and 5 percent, respectively, from the previous week. Total inspections of grain (corn, wheat, and soybeans) for export from all major export regions reached 1.7 1 m mt, down 5 percent from the past week, but 70 percent above last year and 17 percent above the 3-year average.
Grain inspections during the last 4 weeks are 4 percent above last year, and year-to-date inspections are up 52 percent from last year.
China Rejects P3 Network
Maersk Line reported on June 17 that China’s Ministry of Commerce announced it would not approve the P3 Network. P3 was a long-term operational vessel-sharing agreement proposed by Mediterranean Shipping Company, CMA CGM, and Maersk Line.
As a result of this announcement, the member carriers have “agreed to stop the preparatory work on the P3 Network and the P3 Network as initially planned will not come into existence.” This announcement comes after the U.S. Federal Maritime Commission (FMC) and its EU counterpart had both agreed to allow the P3 alliance to be established but had stated they would monitor the market closely for anti-competitive behavior.
Port of Oakland Requests Changes to Agreement with FMC
The Port of Oakland has filed an amendment to its Marine Terminal Operators agreement with FMC to give the terminal operators authority to discuss and agree on a potential off-peak program. The FMC is looking for comments from the export community about this program and how it could affect business and services through the Port of Oakland. See the FMC’s Federal Register Notice for more detail.
Snapshots by Sector
- Rail U.S. railroads originated 17,568 carloads of grain during the week ending June 7, down 11 percent from last week, up 16 percent from last year, and down 5 percent from the 3-year average. During the week ending June 12, average June non-shuttle secondary railcar bids/offers per car were $50 below tariff, down $50 from last week and $50 lower than last year. Average shuttle secondary railcar bids/offers per car were $800 above tariff, up $375 from last week and $ 70 0 higher than last year.
- Barge During the week ending June 14 barge grain movements totaled 652,352 tons — 17.7 percent lower than the previous week but 72.5 percent higher than the same period last year. During the week ending June 14, 416 grain barges moved down river , down 15.8 percent from last week; 592 grain barges were unloaded in New Orleans, up 5 percent from the previous week.
- Ocean During the week ending June 12, 31 ocean-going grain vessels were loaded in the Gulf, 29 percent more than the same period last year. Twenty-nine vessels are expected to be loaded within the next 10 days, 12 percent less than the same period last year. During the week ending June 13, the ocean freight rate for shipping bulk grain from the Gulf to Japan was $44 per mt, down 2 percent from the previous week. The cost of shipping from the PNW to Japan was $23 per mt, down 4 percent from the previous week .
- Fuel During the week ending June 16, U.S. average diesel fuel prices decreased 1 cent from the previous week to $3.88 per gallon — up 4 cents from the same week last year.