Grain Barge Rates Decline Since October…
St. Louis barge rates for export grain peaked on October 3 at 800 percent of tariff ($31.92 per ton), but dropped significantly to 338 percent of tariff ($13.49 per ton) by the end of October. The average November barge rate for St. Louis was 240 percent of tariff ($9.58 per ton). Presently, the average December barge rate for St. Louis is about 200 percent of tariff ($7.98 per ton).
Similar patterns were observed for other major barge originating locations, except for the Ohio River, where rates have seen occasional increases due to delays caused by lock and dam repairs.
…and Secondary Railcar Markets Drop Since August
Weekly average October and November shuttle rates on the secondary railcar market fell from late August through November due to adequate railcar supply relative to a lower-than-expected demand. Rail shipments of grain over the past four weeks have been only 89 percent of last year’s level. Compared to the previous year, weekly average October shuttle rates per car were almost $1,000 less on BNSF and $700 less on UP between August and October.
Weekly average November shuttle rates per car were almost $600 less on BNSF and $200 less on UP between August and November. Average December shuttle secondary railcar bids/offers per car were $141 below tariff for the week ending December 7, $286 lower than last year.
According, to the December USDA World Agricultural Supply and Demand Estimates, there has been reduced soybean exports during September, October, and November due to stronger-than-expected competition from Argentina and Brazil.
Grain Inspections Lowest Since September
For the week ending December 7, total inspections of grain (corn, wheat, and soybeans) for export from all major U.S. export regions reached 2.28 million metric tons (mmt), down 21 percent from the previous week, down 29 percent from the same time last year, and 29 percent below the 3-year average.
Grain News on AgFax
The drop in inspections was caused primarily by the typical slowdown in demand from Asia and Latin America during this period. Grain inspections were the lowest since the middle of September, with wheat inspections decreasing 23 percent from the previous week, and soybeans dropping 31 percent for the same period. Inspections of corn rebounded from the past week, increasing 9 percent.
Pacific Northwest (PNW) inspections decreased 14 percent from the past week, and Mississippi Gulf grain inspections decreased 29 percent for the same period. Outstanding (unshipped) export sales were down for wheat and soybeans, but up for corn.
Snapshots by Sector
For the week ending November 30, unshipped balances of wheat, corn, and soybeans totaled 33.6 mmt, down 20 percent from the same time last year. Net weekly wheat export sales were .322 mmt, up 74 percent from the previous week. Net corn export sales were .876 mmt, up 46 percent from the previous week, and net soybean export sales were 2.0 mmt for the same period, up significantly from the previous week.
U.S. Class I railroads originated 25,712 grain carloads for the week ending December 2, up 37 percent from the previous week, up 3 percent from last year, and up 13 percent from the 3-year average.
There were no shuttle bids/offers last week and no non-shuttle bids/offers this week.
For the week ending December 9, barge grain movements totaled 811,802 tons, 14 percent higher than the previous week, and down 23 percent from the same period last year.
For the week ending December 9, 524 grain barges moved down river, up 15 percent from last week. 676 grain barges were unloaded in New Orleans, 22 percent lower than the previous week.
For the week ending December 7, 37 ocean-going grain vessels were loaded in the Gulf, 18 percent less than the same period last year. Sixty-one vessels are expected to be loaded within the next 10 days, 27 percent less than the same period last year.
For the week ending December 7, the ocean freight rate for shipping bulk grain from the Gulf to Japan was $44.25 per metric ton, unchanged from the previous week. The cost of shipping from the PNW to Japan was $24.75 per metric ton, unchanged from the previous week.
During the week ending December 11, average diesel fuel prices decreased 1 cent from the previous week at $2.91 per gallon, 42 cents above the same week last year.