Moving Grain: Officials Sign Agreement for Deepening Lower Mississippi River

    Barges on Mississippi River. ©Debra L Ferguson

    Officials Sign Agreement for Deepening the Lower Mississippi River

    On August 7, officials with the U.S. Army Corps of Engineers, the State of Louisiana, and the Port of New Orleans signed an agreement to deepen the Lower Mississippi River to 50 feet, from its current depth of 45 feet. Slated for completion in 2024, the $250 million project will deepen two sections within a 256-mile stretch of the lower Mississippi River—from the Port of Baton Rouge south to the Gulf of Mexico.

    The new depth will allow bulk cargo vessels to undertake full loads at river ports, instead of partially loading and transferring cargo to larger ships elsewhere. The deepening of the lower Mississippi River—the main export region for America’s soybean and corn farmers—is expected to result in significant transportation cost savings for shippers.

    According to a report sponsored by USDA’s Agricultural Marketing Service, this project will lower the landed cost of soybean shipments from the Gulf by $5 per metric ton. Additionally, the project will increase basis by 13 cents per bushel for locations within 205 miles of the river, and extend the river “draw” from 205 miles to 247 miles (i.e., shippers farther away from the river will benefit from access to more cost-effective barge shipping).

    OOIDA Seeks a 1-Year Suspension of the Heavy Vehicle Use Tax

    In an open letter to Congress, the Owner-Operator Independent Drivers Association (OOIDA) asked for a 1-year waiver of the heavy vehicle use tax—an annual fee that costs about $550 per truck. OOIDA asserts the waiver would help all trucking businesses, irrespective of size.

    OOIDA’s request is posed as an alternative to the proposed suspension of the Federal excise tax of 12 percent on the purchase of new trucks led by the National Automobile Dealers Association and supported by trade groups and other private companies.

    Survey Highlights COVID-19’s Impact on Owner-Operators

    American Truck Business Services (ATBS)—a tax and accounting firm for owner-operator truck drivers—surveyed more than 300 owner-operators to assess the impact of COVID-19, as well as effects of Federal relief programs and relaxed regulations.

    Grain News on AgFax

    ATBS found 81 percent of owner-operators received the Government’s $1,200 economic impact payment; 53 percent applied for a Paycheck Protection Program loan; and 30 percent received some other type of funding. Regarding relaxed regulations, a majority of respondents have not had to operate outside of normal regulations during the crisis.

    Further, 87 percent reported their hours have not exceeded standard hours-of-service rules; 95 percent have not had to operate with an expired CDL; and 96 percent have not had to haul a load above weight limits.

    Of the owner-operators surveyed, 35 percent experienced a decline in freight volumes of 50 percent or more; 47 percent had a decline of 30 percent or more; and 11 percent said freight was nonexistent. ATBS also found 65 percent of truck businesses are still operating during the pandemic, while 6 percent have had to furlough employees or independent contractors.

    Snapshots by Sector

    Export Sales

    For the week ending July 30, unshipped balances of wheat, corn, and soybeans totaled 17.8 million metric tons (mmt). This represented a 16-percent increase in outstanding sales from the same time last year.

    Net corn export sales were 0.102 mmt, down significantly from last week. Net soybean export sales were 0.345 mmt, up 72 percent from the previous week. Net wheat export sales were 0.606 mmt, down 11 percent from the previous week.


    U.S. Class I railroads originated 21,205 grain carloads during the week ending August 1. This was a 3-percent increase from the previous week, 6 percent less than last year, and 7 percent lower than the 3-year average.

    Average August shuttle secondary railcar bids/offers (per car) were $288 above tariff for the week ending August 6. This was $269 less than last week and $438 more than this week last year. There were no non-shuttle bids/offers this week.


    For the week ending August 8, barge grain movements totaled 626,068 tons. This was 30 percent less than the previous week and 10 percent more than the same period last year.

    For the week ending August 8, 399 grain barges moved down river—158 fewer barges than the previous week. There were 797 grain barges unloaded in New Orleans, 29 percent more than the previous week.


    For the week ending August 6, 36 oceangoing grain vessels were loaded in the U.S. Gulf—13 percent more than the same period last year. Within the next 10 days (starting August 7), 46 vessels were expected to be loaded—5 percent more than the same period last year.

    As of August 6, the rate for shipping a metric ton (mt) of grain from the U.S. Gulf to Japan was $42.50. This was 2 percent more than the previous week. The rate from the Pacific Northwest to Japan was $22.75 per mt, 5 percent more than the previous week.


    For the week ending August 10, the U.S. average diesel fuel price increased 0.4 cents from the previous week to $2.428 per gallon, 58.3 cents below the same week last year.

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