The pinch point for navigation on the Mississippi River has moved upstream from Memphis, TN, to St. Louis, MO, as the Army Corps of Engineers starts to reduce flows from the upstream Missouri River dams.
Lower water flows coming from the Missouri River will lead to longer dredging operations on the Mississippi River around St. Louis to keep a navigation channel open.
Barge movements remain slow, but the New Orleans, LA, area grain terminals reported a 35% increase in barges they were able to unload compared to a week earlier, according to a Nov. 17 weekly USDA report.
Brad Rippey, a meteorologist at USDA’s Office of the Chief Economist, said on a Nov. 18 webinar that spot barge rates have dropped from $110/metric ton (mt) in October down to closer to $40/mt now. The rate had run at $20/mt for much of the year.
For farmers, Rippey said this has translated to some producers on the lower Mississippi River receiving $2 less per bushel for both corn and soybeans.
“We started seeing these big spikes in the cost of moving agricultural products downstream, and that has led to some of these spot prices going up to $2 to even over $3 (less),” Rippey said. “So that’s really cutting into the profit margins for some of these producers.”
Barges have been pinched by the shallow drafts. The barges themselves are carrying anywhere from 20-40% less cargo to meet a 9-foot draft, and the tows are moving fewer barges because of the narrow channel. Tow operators that would normally move 45 barges are now restricted to tows as small as 25 barges in certain areas.
“It presents a certain challenge trying to find the navigation channel,” said Paul Rohde, vice president of the Midwest area for the Waterways Council Inc., which advocates for inland waterway operators. Describing the situation, Rohde said, “I’d say right now we have got a stabilized crisis.”
Rohde added the economic costs of a shallow Mississippi River might be hard to quantify, “but the impacts are in the billions of dollars.”
According to charts Rippey presented during the webinar, at the slowest point in October, barge movements on the Mississippi River dropped from a three-year average of roughly 350 barges down to about 150 barges. In that same low point in October, tonnage fell from about 500,000 mt a week on average down to about 200,000 mt.
Shallow St. Louis
On Nov. 19, the Army Corps of Engineers upstream on the Missouri River announced reduced water releases from the lowest dam on the Missouri River, in Gavins Point, SD.
Gavins Point had been averaging about 30,000 cubic feet per second (cfs), but the Corps is starting to dial back water releases and will bring it down to the minimum level of 12,000 cfs. The Corps will step down water releases about 3,000 cfs per day until late November.
As DTN has reported, the Army Corps of Engineers on the Missouri River is not authorized to change water releases to support the Mississippi River.
By the end of November, that drawdown on the Missouri River will drop the Mississippi River levels about 3 feet at St. Louis and at lower locations on the river until the Mississippi River gets closer to Cairo, IL.
That lower flow from the Missouri River will force dredging operations in the middle section of the Mississippi River. Dredging, which can halt barge traffic, will be operated on a 12-hours-on, 12-hours-off schedule to allow navigation during that time. Col. Andy Pannier, Corps deputy commander in the Mississippi Valley Division, said extreme conditions expected in early December could lead to extended dredging hours, ranging anywhere from 24 to 72 hours, before navigation can start again.
“We remain confident that our dredging operations will keep the river operating at a 9-foot depth in the channel,” Pannier said.
Grain and barge movement
Combined, corn and soybean shipments on the river systems, including the Illinois and Ohio rivers, for 2022 are just over 26 million mt, down about 12.5% from the same year to date in 2021.
For the week ending Nov. 12, USDA’s Grain Transportation Report showed total grain shipments on the inland waterways at 592,000 mt. That was 7% lower than a week earlier and 33% less than the same week a year ago.
At the same time, 830 grain barges unloaded in the New Orleans port terminals, a 35% increase from a week earlier.
During the last month, soybean shipments down the river system have been about 96% of last year’s volume during the same four-week stretch. Corn shipments down the river system during the past month are just at 58% of last year’s volume.
Total grain export inspections at the Mississippi Gulf equal about 95% of last year’s volume, according to USDA. Corn, soybeans and wheat total 55.17 million mt in the Mississippi Gulf, compared to 57.85 million mt last year.
Overall, USDA numbers show the Mississippi Gulf grain inspections for exports are closer to hitting last year’s volumes than the Pacific Northwest, at 81% of last year’s volumes, and the Texas Gulf, at 73%. Interior exports are at 96% of last year’s volume. — Chris Clayton, DTN ag policy editor
