Grain Barge Tonnages Reached Record High Last Week
For the week ending May 8, year-to-date (YTD) total barged grain movements reached a record-high 14.5 million tons, 47 percent higher than last year, 33 percent higher than 5-year average, and 38 percent higher than the 10-year average.
The exceptionally high YTD tonnage mostly reflects a high demand for corn exports. At 10.4 million tons, YTD total barged corn movements also set a record. This total was 98 percent higher than last year, 65 percent higher than the 5-year average, and 77 percent higher than the 10-year average.
A couple of factors contributed to the high grain and corn totals: First, water conditions that had complicated barge logistics earlier this year have substantially improved. Second, the Asian market, especially China, has shown a continuously strong demand for imported grain.
Closure of 1-40 Bridge Shuts Down Barge Traffic on Mississippi River
According to the Tennessee Department of Transportation (TDOT), beginning May 11 the I-40 Hernando DeSoto bridge was closed, after a routine inspection revealed a crack on the bottom of the bridge truss. As of May 13, both highway traffic over the bridge and river traffic under the bridge continue to be shut down until further notice.
Contract crews must investigate the extent of the crack and make emergency repairs. It is unclear how long the repairs will take. Currently, vehicular traffic is being rerouted, and Coast Guard officials are working with barge operators to determine the safest alternative to resume barge traffic.
Low Ethanol Stocks May Support Production and Increased Transportation Demand
For the week ending May 7, 2021, the U.S. Energy Information Administration’s (EIA) total domestic ethanol stocks were reported at 19.34 million barrels, their lowest level for the week since 2014. Currently, ethanol stocks in three of the five Petroleum Administrations for Defense Districts (PADDs) are at their lowest level since 2016.
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Ethanol stocks in the West coast region (PADD 5), which includes Nevada and Arizona, are their second lowest level since 2011. Potentially boosted by a need to replenish these stocks, ethanol production is also expected to rise in accord with seasonal patterns, according to EIA data.
EIA reports current national ethanol production at 979,000 barrels/day. As the U.S. economy continues to reopen and driving miles increase, domestic ethanol and byproduct production should continue to rise and support truck and rail demand.
Snapshots by Sector
For the week ending April 29, unshipped balances of wheat, corn, and soybeans totaled 32.3 million metric tons (mmt). This was 8- percent lower than last week, but 42 percent higher than the same time last year.
Net corn export sales were 0.137 mmt, down 74 percent from the past week. Net soybean export sales were 0.165 mmt, down 44 percent from the previous week. Net weekly wheat export sales were -0.096 mmt, down significantly from the previous week.
U.S. Class I railroads originated 28,097 grain carloads during the week ending May 1. This was a 10-percent increase from the previous week, 24 percent more than last year, and 22 percent more than the 3-year average.
Average May shuttle secondary railcar bids/offers (per car) were $96 below tariff for the week ending May 6. This was $54 less than last week and $117 more than this week last year. There were no non-shuttle bids/offers this week.
For the week ending May 8, barge grain movements totaled 1,004,586 tons. This was 50 percent more than the previous week and 18 percent more than the same period last year.
For the week ending May 8, 633 grain barges moved down river—195 more barges than the previous week. There were 765 grain barges unloaded in New Orleans, 5 percent less than the previous week.
For the week ending May 6, 30 oceangoing grain vessels were loaded in the Gulf—9 percent fewer than the same period last year. Within the next 10 days (starting May 7), 51 vessels were expected to be loaded—21 percent more than the same period last year.
As of May 6, the rate for shipping a metric ton (mt) of grain from the U.S. Gulf to Japan was $65.00. This was 3 percent more than the previous week. The rate from the Pacific Northwest (PNW) to Japan was $38.00 per mt, 4 percent more than the previous week.
For the week ending May 10, the U.S. average diesel fuel price increased 4.4 cents from the previous week to $3.186 per gallon, 79.2 cents above the same week last year.