Moving Grain: Flooding Continues to Disrupt Barge and Rail

Grain barges. Photo: Kansas State University

Flooding Continues to Disrupt Barge Traffic

On-going flooding continues to disrupt barge traffic on the major waterways. As of April 11, there are 10 locks on the Upper Mississippi River that are closed due to high water. To ensure safe passage under bridges that span the Mississippi River, barge traffic is restricted to daylight only in several locations on the Lower Mississippi River and in the St. Louis area.

American Commercial Barge Line reports river levels at Memphis are receding and 24-hour traffic has resumed. As of April 9, barge operators report a second week of spot grain barge rate declines, as many shippers are not looking to buy barge services for the first half of April.

Year-to-date barge grain shipments are 15 percent lower than last year.

Railroads Continue to Recover from Midwest Flooding

BNSF Railway (BNSF) and the Union Pacific Railroad (UP) continue to make significant progress restoring service following record flooding in the Midwest; some outages remain.

BNSF reopened the Council Bluffs Subdivision and reported that trains are moving again along two critical segments, the Creston Subdivision (an east/west artery between Lincoln, NE, and Creston, IA) and the St. Joseph Subdivision (between Lincoln, NE, and Kansas City, MO).

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UP brought multiple subdivisions back online and is nearly complete in restoring service between Council Bluffs, IA, and Kansas City, KS (a rail bridge outage remains).

For BNSF, track between Pacific Junction, IA, and Napier, MO, and segments along the Mississippi River remain out of service. UP’s corridor between Fremont and Lincoln, NE, remains closed.

Details on STB Hearing on Railroad Demurrage and Accessorial Fees (May 22)

On April 8, 2019, the Surface Transportation Board (STB) provided additional details regarding their May 22 public hearing on railroad demurrage and accessorial charges (Docket No. EP 754).

According to the decision, anyone who wishes to speak at the hearing must file a notice of intent to participate with the STB no later than April 24; Class I railroads are required to submit a variety of demurrage and accessorial information by May 1; and written comments, both from those testifying and other interested parties, must be filed by May 8.

Grain Inspections Up for Third Consecutive Week

For the week ending April 4, total inspections of grain for export from all major U.S. export regions reached 2.52 million metric tons (mmt). This shows a 1 percent increase from the previous week, a 10 percent decrease from last year, and a 5 percent increase from the 3-year average.

Inspections of grain were up for the third consecutive week. The increase in inspections was driven by a 19 percent increase in wheat inspections and a 21 percent increase in soybean inspections. Soybean shipments destined to China rebounded, increasing 45 percent from week to week.

Inspections of corn, however, were down 18 percent from the past week. Pacific Northwest (PNW) inspections increased 18 percent from the previous week, while Mississippi Gulf inspections decreased 19 percent.

Snapshots by Sector

Export Sales

For the week ending March 28, unshipped balances of wheat, corn, and soybeans totaled 32.9 mmt. This indicates an 11 percent decrease in outstanding sales, compared to the same time last year.

Net weekly wheat export sales were .705 mmt, up 48 percent from the previous week. Net corn export sales totaled .537 mmt, down 41 percent from the previous week. However, net soybean export sales totaled 1.97 mmt, up significantly from the past week.

Rail

U.S. Class I railroads originated 22,565 grain carloads for the week ending March 30. This is a 2 percent increase from the previous week, 6 percent lower than last year, and 2 percent below the 3-year average.

Average April shuttle secondary railcar bids/offers (per car) were $606 above tariff for the week ending April 4. This is up $266 from last week and $131 above last year. There were no non-shuttle bids/offers this week.

Barge

For the week ending April 6, barge grain movements totaled 504,987 tons. This is 27 percent lower than the previous week and 20 percent lower than the same period last year.

For the week ending April 6, 330 grain barges moved down river. This is 71 less barges than the previous week. There were 469 grain barges unloaded in New Orleans, 28 percent lower than the previous week.

Ocean

For the week ending April 4, 30 ocean-going grain vessels were loaded in the Gulf. This is 17 percent less than the same period last year. Forty-four vessels are expected to be loaded within the next 10 days, 20 percent less than the same period last year.

For the week ending April 4, the ocean freight rate for shipping bulk grain from the Gulf to Japan was $42.00 per mt. This is 1 percent more than the previous week. The cost of shipping from the PNW to Japan is unchanged from the previous week, at $23.75 per mt.

Fuel

For the week ending April 8, the U.S. average diesel fuel price increased to $3.093 per gallon, 1.5 cents above the previous week’s average and 5 cents above the same week last year.

Full report.


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