Grain Barge Spot Rates Decline for Second Week
As of August 21, barge spot rates for export grain dropped 1 to 14 percent, at principal origination points, compared to a week ago. This was similar to last week (August 14), when rates dropped 1 to 13 percent from the previous week. Typically, barge rates begin rising gradually in late August, as barge operators prepare for a seasonal demand increase that occurs during harvest.
However, year-to-date tonnages for grain, on the locking sections of the Mississippi, Ohio, and Arkansas rivers, are down 8 percent compared to last year. During the same time frame, tonnages for corn are down 4 percent, and soybeans are down 11 percent. Rates have dropped, despite ongoing navigation issues that have disrupted traffic.
The lower Ohio River continues to have disruptions with repair work at Locks and Dam (L&D) 52. While Olmsted L&D will hold a ribbon cutting ceremony on August 30, it will not be fully operational until later this summer. On-going disruptions may continue on the lower Ohio River for the near future.
Soybean Inspections Increase, but Total Inspections Down
For the week ending August 16, total inspections of grain (corn, wheat, and soybeans) for export from all major U.S. export regions reached 2.11 million metric tons (mmt); down 11 percent from the previous week, up 5 percent from last year, and 2 percent below the 3-year average.
Soybean inspections increased 10 percent from the previous week, but wheat and corn dropped 29 and 13 percent,respectively. Inspections of soybeans have averaged .759 mmt during the last four weeks, despite the drop in shipments to China.During the last four weeks, U.S. soybean shipments destined to China have averaged only .032 mmt, compared to .221 mmt last year.
Total grain inspections increased 8 percent from the past week in the Mississippi Gulf, while Pacific Northwest inspections decreased 21 percent for the same period. Outstanding (unshipped) export sales rebounded for corn, but decreased for wheat and soybeans.
FMC Seeks Input from Shippers on Detention and Demurrage Practices
The Federal Maritime Commission (FMC) continues to seek input from exporters experiencing unfair detention and demurrage practices by ocean container carriers and marine terminal operators. FMC initiated the investigation, Fact Finding 28, under a Commission Order dated March 5, 2018.
The first phase of the investigation involved gathering information from ocean carriers and marine terminal operators serving a broad section of container ports located throughout the United States. The Commission is now seeking input from the export community.
Commissioner Rebecca Dye emphasizes that it is critical that shippers, dray truck companies, and other affected parties, who can document specific allegations and provide supporting materials of unreasonable port detention and demurrage practices and fees, step forward and cooperate with the investigation.
Correspondence, allegations, and supporting documents can be sent to the Commission via FF28@FMC.Gov.
Snapshots by Sector
For the week ending August 9, unshipped balances of wheat, corn, and soybeans totaled 16.1 mmt, up 16 percent from the same time last year. Net weekly wheat export sales were .803 mmt, up significantly from the previous week, and the highest so far for the new marketing year. Net corn export sales were .339 mmt, down 39 percent from the previous week. Net soybean export sales were .134 mmt, down 68 percent from the previous week.
U.S. Class I railroads originated 21,770 grain carloads, for the week ending August 11; down 13 percent from the previous week, up 14 percent from last year, and down 1 percent from the 3-year average.
Average September shuttle secondary railcar bids/offers per car were $56 above tariff, for the week ending August 16; up $166 from last week, and $110 higher than last year. Average non-shuttle secondary railcar bids/offers per car were $219 above tariff, up $19 from last week, and $234 higher than last year.
For the week ending August 18, barge grain movements totaled 711,798 tons, 25 percent less than the previous week and down 29 percent from the same period last year.
For the week ending August 18, 441 grain barges moved down river, 164 barges less than the previous week. There were 731 grain barges unloaded in New Orleans, 10 percent higher than the previous week.
For the week ending August 16, 30 ocean-going grain vessels were loaded in the Gulf, 14 percent less than the same period last year. Fifty-four vessels are expected to be loaded within the next 10 days, 4 percent more than the same period last year.
For the week ending August 16, the ocean freight rate for shipping bulk grain, from the Gulf to Japan, was $45.00 per metric ton, up 2 percent from the previous week. The cost of shipping, from the PNW to Japan, was $24.75 per metric ton, up 2 percent from the previous week.
For the week ending August 20, the U.S. average diesel fuel price decreased 1 cent, from the previous week, to $3.207 per gallon, 61.1 cents above the same week last year.