For the week ending November 6, total inspections of grain (corn, wheat, soybeans) from all major export regions reached 3.35 million metric tons (mmt), down 3 percent from the past week, but up 12 percent from last year, and 24 percent above the 3-year average.
Despite the drop in total grain inspections, corn (.506 mmt) and wheat (.316 mmt) inspections rebounded, increasing 22 and 47 percent from the past week. Soybean inspections (2.53 mmt) however receded, falling 11 percent from the previous week. Inspections of soybeans remained above the 3-year average.
Rates Fall in Secondary Railcar Market …
Prior to the start of this year’s harvest, secondary rail rates had risen in anticipation of continuing rail congestion. After reaching a high in late September, rates in the secondary railcar market have fallen considerably over the past 6 weeks as weekly graincar loadings have increased, averaging over 22,000 carloads per week since October.
During the week ending November 6, average November non-shuttle secondary railcar bids/offers per car were $613 above tariff, down $488 from last week, down $2,388 from 6 weeks ago, but $88 higher than last year. Average shuttle bids/offers per car were $382 above tariff, down $594 from last week , down $4,244 from 6 weeks ago, and $744 below last year.
… And Barge Rates Decline
As of November 11, barge rates have been declining after reaching late September highs. Large numbers of barges have been unloaded at the Gulf and returned upstream. However, barge rates remain significantly above average for principle origins. Currently, the spot barge rate for export grain from St. Louis is $26.93 per ton, $6.50 above the 3-year average, down $1.96 from last week, and down $14.28 from 6 weeks ago.
Gulf Grain Vessel Loading Activity Still Strong
Grain vessel loading activity in the U.S. Gulf continues to be strong. During the week ending November 6, 48 ocean-going grain vessels were loaded in the Gulf, 52 vessels were loading or waiting to load, and 73 vessels are expected to be loaded within the next 10 days. During the previous 8 weeks, an average of 41 vessels were loaded per week, 41 vessels were loading or waiting to be loaded, and 66 vessels were expected within the next 10 days.
During the past few weeks downbound soybean barge movements on the Mississippi River have been strong and ocean freight rates for shipping bulk grains have been favorable.
Panama Canal Lock Maintenance Reduces Transit Capacity
The East Lane of the Gatum Locks on the Panama Canal will be closed for maintenance and repair work on November 14 and 21, 2014. The estimated transit capacity of the Canal due to the maintenance work is 32-34 vessels per day, rather than the normal transit capacity of 38-40 vessels. At this time, no major delays are anticipated.
Snapshots by Sector
- Rail U.S. railroads originated 23,847 carloads of grain during the week ending November 1, up 7 percent from last week, 15 percent from last year, and 12 percent from the 3-year average.
- Barge During the week ending November 8 barge grain movements totaled 1,054,335 tons — 25.8 percent higher than the previous week and 33.4 percent higher than the same period last year. During the week ending November 8, 664 grain barges moved down river, up 24 percent from last week; 976 grain barges were unloaded in New Orleans , up 10.7 percent from the previous week.
- Ocean During the week ending November 6, 48 ocean-going grain vessels were loaded in the Gulf, 7 percent more than the same period last year. Seventy-three vessels are expected to be loaded within the next 10 days, 5 percent less than the same period last year. During the week ending November 7, the ocean freight rate for shipping bulk grain from the Gulf to Japan was $45.50 per mt, down 1 percent from the previous week. The cost of shipping from the PNW to Japan was $25.00 per mt, down 2 percent from the previous week.
- Fuel During the week ending November 10, U.S. average diesel fuel prices increased 5 cents from the previous week to $3.68 per gallon– down 16 cents from the same week last year.