Grain Barge Logistics Improve as Mississippi River Recedes
As of July 3, the Mississippi River gauge at St. Louis was 37.4 feet, and forecasts for July indicate a rapid decline in river levels. The river has been declining since June 26, which has allowed barge traffic to pass upbound and downbound through St. Louis. With the opening of St. Louis (which occurs when river levels are below or near 38 feet), upbound barges have been able to travel up the Mississippi and Illinois Rivers with empty barges of all kinds.
For the week ending June 29, there were 319 upbound empty barges passing through Mississippi River Locks 27. This was the highest number of empty barges since November 2018. For the same time period, there were 312 barges of corn and 209 barges of soybeans going downbound through Mississippi River Locks 27.
The weekly numbers of corn and soybean barges were the highest of the year. Nearly the entire length of the Mississippi River has some types of navigation restrictions that include tow size limitations, traveling under certain bridges during daylight hours only, or taller vessels prohibited from traveling under bridges due to clearance restrictions.
June Soybean Stocks Up Significantly from 2018
Last week, USDA’s National Agricultural Statistics Service (NASS) published its quarterly (June) Grain Stocks and annual Acreage reports, which provide insight for current and upcoming grain transportation. U.S. grain stores are high, mainly due to high soybean inventories. As of June 1, 2019, national grain stocks (including barley, corn, grain sorghum, oats, soybeans, and wheat) were 8.3 billion bushels (bbu), a 6 percent increase from a year ago and 12 percent higher than the 3-year average.
Grain News on AgFax
While June corn stocks (5.2 billion bushels) were down 2 percent (-102 million bushels) compared to 2018, soybean stocks were up 47 percent (+571 million bushels). Grain “disappearance” from December to June—a proxy for movements—was down 4 percent from last year.
NASS anticipates a 2 percent increase in the area harvested for corn, but a 3 and 10 percent decline in the area harvested for wheat and soybeans, respectively.
Due to excessive rainfall affecting plantings, NASS is collecting updated acreage information. Data are expected on August 12.
Grain Inspections Down Despite Higher Wheat and Soybeans
For the week ending June 27, total inspections of grain (corn, wheat, and soybeans) for export from all major U.S. export regions reached 1.67 million metric tons (mmt). This is 7 percent lower than the previous week, 41 percent lower than last year, and 30 percent lower than the 3-year average.
Inspections of wheat and soybeans increased 41 and 5 percent, respectively, from the previous week, but they were not enough to offset the 56 percent drop in corn inspections. Shipments of corn destined to Asia were significantly lower than the past week.
Total grain inspections dropped 27 percent in the Pacific Northwest and 5 percent in the Mississippi Gulf from the previous week.
Snapshots by Sector
For the week ending June 20, unshipped balances of wheat, corn, and soybeans totaled 22.4 mmt. This denotes a 14 percent decrease in outstanding sales, compared to the same time last year. Net corn export sales reached .295 mmt, up significantly from the previous week. Net soybean export sales totaled .149 mmt, down 74 percent from the past week. Net weekly wheat export sales reached .612 mmt, up 226 percent from the previous week.
U.S. Class I railroads originated 22,794 grain carloads for the week ending June 22. This is a 2 percent increase from the previous week, 5 percent lower than last year, and unchanged from the 3-year average.
Average July shuttle secondary railcar bids/offers (per car) were $95 below tariff for the week ending June 27. This is $295 less than last week and $549 lower than last year. Average non-shuttle secondary railcar bids/offers were $125 above tariff, $17 more than last week. There were no non-shuttle bids/offers this week last year.
For the week ending June 29, barge grain movements totaled 739,788 tons. This is a 358 percent increase from the previous week and 20 percent lower than the same period last year.
For the week ending June 29, 469 grain barges moved down river. This is 378 more barges than the previous week. There were 373 grain barges unloaded in New Orleans, 41 percent more than the previous week.
For the week ending June 27, 21 ocean-going grain vessels were loaded in the Gulf. This is 34 percent fewer than the same period last year. Forty-five vessels are expected to be loaded within the next 10 days. This is 13 percent more than the same period last year.
As of June 27, the rate for shipping a metric ton (mt) of grain from the U.S. Gulf to Japan was $43.00. This is 1 percent more than the previous week. The rate from the Pacific Northwest to Japan was $23.75 per mt; unchanged from the previous week.
For the week ending July 1, the U.S. average diesel fuel price decreased 0.1 cents from the previous week, to $3.042 per gallon. This price is 19.4 cents less than the same week last year.