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    Moving Grain: FMC Launches 3 Initiatives To Improve Supply Chain Performance

    Barge and ship traffic transport export cargo on the Mississippi River in the Port of New Orleans. Photo: Bob Nichols, USDA

    FMC Launches Three Initiatives To Improve Supply Chain Performance

    The Federal Maritime Commission (FMC) recently announced three new initiatives that will enhance assistance to shippers, further improve compliance with FMC regulations, and help resolve supply chain issues. All three actions are based on recommendations in FMC’s report, “The Effects of COVID-19 on the U.S. International Ocean Transportation Supply Chain.”

    One initiative will establish a new and permanent International Ocean Shipping Supply Chain Program. Another will reestablish the Export Rapid Response Team. Finally, the third action will take the steps necessary for carriers, marine terminal operators, and operating seaports to employ a designated FMC compliance officer.

    The report recommending the actions is the result of a 2-year investigation involving hundreds of FMC stakeholders.

    BNSF Railway Limits Cargo to California

    From June 29 through the end of July, BNSF will limit traffic destined to California. The railroad said it has experienced significant service challenges due to severe congestion and poor weather, such as high wind events, flash flooding, and heavy rains. From June 29 to July 5, limited commodities—including grain and grain products—can request a permit for shipment to California. (Shippers need to request this permit one week prior to desired shipment date.)

    After July 5, those specified commodities, along with fertilizers, will no longer need a permit, but all other (non-specified) commodities would need to request a permit to reach California. Intermodal traffic to California is not affected by the embargo.

    DOT CRISI Grants Will Help Improve Midwestern Rail Transport

    The Department of Transportation’s (DOT) Federal Railroad Administration recently announced the award of funding from its Consolidated Rail Infrastructure and Safety Improvements (CRISI) grant program—part of which will be used to help increase supply chain resilience and fluidity. The funds include $184 million for rural rail projects.

    Grain News on AgFax

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    The rural grant awards include funds devoted to shortline railroads in many top grain-producing States, such as Michigan ($30 million), Kansas ($20.4 million), Indiana ($8.4 million), Iowa ($7.1 million), Ohio ($6.9 million), North Dakota ($6.7 million), Nebraska ($6.3 million), Illinois ($1.8 million), and Minnesota ($1.4 million). The short line rail industry plays a key role in the first and last miles of grain shipments by rail.

    In 2018, USDA funded research that developed a list of available Federal and State short-line-rail assistance programs.

    Snapshots by Sector

    Export Sales

    For the week ending June 16, unshipped balances of wheat, corn, and soybeans totaled 23.5 million metric tons (mmt), up 7 percent from the same time last year and down 3 percent from the previous week.

    Net corn export sales were 0.672 mmt, up significantly from the previous week. Net soybean export sales were 0.029 mmt, down 91 percent from the previous week. Net weekly wheat export sales for the new marketing year 2022/23 (which began June 1) were 0.478 mmt, up significantly from last week.

    Rail

    U.S. Class I railroads originated 22,012 grain carloads during the week ending June 18. This was a 3-percent increase from the previous week, 12 percent more than last year, and 4 percent more than the 3-year average.

    Average July shuttle secondary railcar bids/offers (per car) were $108 below tariff for the week ending June 23. This was $38 less than last week and $150 more than this week last year.

    Barge

    For the week ending June 25, barged grain movements totaled 619,210 tons. This was 19.5 percent lower than the previous week and 17.8 percent lower than the same period last year.

    For the week ending June 25, 410 grain barges moved down river—114 fewer barges than the previous week. There were 463 grain barges unloaded in the New Orleans region, 6 percent fewer than last week.

    Ocean

    For the week ending June 23, 26 oceangoing grain vessels were loaded in the Gulf—24 percent more than the same period last year. Within the next 10 days (starting June 24), 34 vessels were expected to be loaded—8 percent fewer than the same period last year.

    As of June 23, the rate for shipping a metric ton (mt) of grain from the U.S. Gulf to Japan was $79.00. This was 1 percent less than the previous week. The rate from the Pacific Northwest to Japan was $45.00 per mt, 1 percent less than the previous week.

    Fuel

    Per a June 28 press release, the U.S. Energy Information Administration notes it is working to restore its system and that its data—including diesel fuel prices—will continue to be delayed.

    Full report.




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