Waterborne Grain Volumes Increase on the Mississippi
For the week ending November 16, grain volumes transiting the locks on the Mississippi River were the second-highest in 2019. Last week, 888,976 tons of corn, wheat, soybeans, and other grains passed through Ohio Olmsted Lock and Dam, Lock and Dam 27 on the Mississippi, and Lock and Dam 1 on the Arkansas River, which nearly matched the previous high for 2019 of 890,199, which occurred in the week ending August 24.
In several States critical to grain production, harvest progress drew closer to the 5-year averages after having lagged far behind the averages for most of the 2019 harvest. Still, many States remain behind their average progress. Greater supplies of grain later in the year due to the delayed harvest are reflected in slightly above-average barge rates in November and December at ports in the upper- and mid- Mississippi areas.
EIA Expects Average Crude Oil Prices in 2020 to Fall Below 2019
In its most recent Short-Term Energy Outlook, the Department of Energy’s Energy Information Administration (EIA) reports crude oil prices were down $3 per barrel in October from September and down $21 per barrel from the previous year. “EIA expects crude oil prices will be lower on average in 2020 than in 2019 because of forecast rising global oil inventories, particularly in the first half of next year.”
Lower crude oil prices lay the foundation for stable diesel fuel prices for agricultural exporters next year. Fuel surcharges for truck, rail, and barge transportation are often based on average diesel fuel prices.
Total Inspections Continue to Increase
For the week ending November 14, total inspections of grain (corn, wheat, and soybeans) for export from all major U.S. export regions reached 2.71 million metric tons (mmt), increasing for the second consecutive week. Total inspections were up 6 percent from the previous week, up 6 percent from last year, but down 20 percent from the 3-year average.
From the past week, corn rose 10 percent, soybeans rose 14 percent, and wheat inspections fell 17 percent. Weekly inspections increased 7 percent from the previous week in the Pacific Northwest (PNW) and 13 percent in the Mississippi Gulf. Despite the increases in weekly inspections, total year-to-date inspections of grain are still below last year by 14 percent.
Snapshots by Sector
For the week ending November 7, unshipped balances of wheat, corn, and soybeans totaled 23.4 mmt. This represents a 20-percent decrease in outstanding sales, compared to the same time last year. Net corn export sales reached .581 mmt, up 19 percent from the past week. Net soybean export sales were 1.25 mmt, down 29 percent from the previous week. Net weekly wheat export sales reached .239 mmt, down 34 percent from the previous week.
Grain News on AgFax
U.S. Class I railroads originated 21,855 grain carloads during the week ending November 9. This is unchanged from the previous week, 2 percent more than last year, and 8 percent lower than the 3-year average.
Average November shuttle secondary railcar bids/offers (per car) were $113 below tariff for the week ending November 14. This is $181 less than last week. There were no shuttle bids/offers this week last year. There were no non-shuttle bids/offers this week.
For the week ending November 16, barge grain movements totaled 888,976 tons. This was a 19-percent increase from the previous week and 21 percent more than the same period last year.
For the week ending November 16, 562 grain barges moved down river—94 more barges than the previous week. There were 734 grain barges unloaded in New Orleans, 6 percent less than the previous week.
For the week ending November 14, 31 oceangoing grain vessels were loaded in the Gulf—21 percent less than the same period last year. Within the next 10 days (starting November 8), 47 vessels were expected to be loaded—20 percent fewer than the same period last year. As of November 14, the rate for shipping a metric ton (mt) of grain from the U.S. Gulf to Japan was $46.50. This was 4 percent less than the previous week. The rate from PNW to Japan was $24.75 per mt, 6 percent less than the previous week.