Additional Rainfall Contributes to On-going Navigation Disruptions
As of April 5, widespread rainfall in the lower and middle Mississippi River Valley, extending into the Ohio River Valley, has added additional navigation disruptions to already flooded segments throughout the inland waterway system. For example, levels on the Ohio River at Cairo, IL, are already above flood stage but will not crest until April 9.
Navigation on the lower Mississippi River continues to be restricted to daylight only, though Vicksburg, MS, and Baton Rouge, LA. Barge movements in the area between Baton Rouge and New Orleans require additional time and towboats to unload grain and return empty barges upriver, due to high and fast river conditions.
As of April 3, the weekly change in spot barge rates for export grain has increased 15 percent on the Illinois River, 19 percent on the Upper Mississippi River at Davenport, IA, and 29 percent at St Louis, MO.
STB Requests Service Outlook from Class I Railroads
On March 16, 2018, STB sent letters requesting service outlook plans from all Class I railroads—in the near term and for the remainder of 2018—due to increased concerns over deteriorating service. STB asked about the adequacy of rail operations concerning locomotive availability, employee resources, local service performance, service demand, communication strategies, and capacity constraints.
STB is concerned about service issues raised in letters from the National Grain and Feed Association, Alliance of Automobile Manufacturers, and The Fertilizer Institute regarding impacts from system-wide rail service deterioration. BNSF Railway and Canadian National have posted responses. All correspondence on this matter is available on the STB website.
Grain News on AgFax
Pacific Northwest Grain Inspections Above Average
For the week ending March 29, total inspections of grain (corn, wheat, and soybeans) for export, from all major U.S. export regions, reached 2.3 million metric tons (mmt); down 6 percent from the previous week, down 14 percent from last year, and 3 percent above the 3-year average. Corn and wheat inspections increased slightly, but could not offset the 24 percent drop in inspections of soybeans.
Pacific Northwest (PNW) grain inspections remained strong at 1 mmt and increased 24 percent from the previous week. During the last four weeks, inspections of grain in the PNW were 21 percent above last year and 37 percent above the 3-year average.
Mississippi Gulf grain inspections decreased 20 percent from week to week. Current outstanding (unshipped) export sales were up for wheat but down for corn and soybeans.
Snapshots by Sector
For the week ending March 22, unshipped balances of wheat, corn, and soybeans totaled 37.2 mmt, up 20 percent from the same time last year. Net weekly wheat export sales were .354 mmt, up 33 percent from the previous week. Net corn export sales were 1.35 mmt, down 8 percent from the previous week. Net soybean export sales totaled .317 mmt, down 58 percent from the previous week.
U.S. Class I railroads originated 23,570 grain carloads for the week ending March 24, unchanged from the previous week, up 1 percent from last year, and up 6 percent from the 3-year average.
Average April shuttle secondary railcar bids/offers per car were $588 above tariff for the week ending March 29, up $131 from last week, and $908 higher than last year. There were no non-shuttle bids/offers this week.
For the week ending March 31, barge grain movements totaled 696,950 tons, 29 percent lower than the previous week and down 18 percent from the same period last year.
For the week ending March 31, 442 grain barges moved down river, 148 barges less than the previous week. There were 610 grain barges unloaded in New Orleans, 9 percent lower than the previous week.
For the week ending March 29, 35 ocean-going grain vessels were loaded in the Gulf, 30 percent less than the same period last year. Fifty-eight vessels are expected to be loaded within the next 10 days, 9 percent more than the same period last year.
For the week ending March 29, the ocean freight rate for shipping bulk grain from the Gulf to Japan was $45.00 per metric ton, 1 percent less than the previous week. The cost of shipping from the PNW to Japan was $24.50 per metric ton, unchanged from the previous week.
During the week ending April 2, average diesel fuel prices increased 3 cents from the previous week to $3.04 per gallon, 49 cents higher than the same week last year.