Market Matters Blog

The long, record-breaking flooding of 2019 on the Mississippi River system has taken a toll on farmland, personal property and the many cities and towns that line the rivers. It has also disrupted commerce on the rivers that depends on barges to move product, especially fertilizer, grain and oilseeds, to and from the Gulf of Mexico and other points along the way.

Only 12 barges have made it to St. Paul, Minnesota, the northernmost point on the Upper Mississippi River, so far this shipping season. The Motor Vessel Aaron F. Barrett, pushing 12 barges heading to St. Paul, Minnesota, locked through Lock and Dam 2 near Hastings on April 24. Since then, flooding and ensuing lock closures have kept most of the entire Upper Mississippi River closed. Most recently, the closure of the St. Louis Harbor shut down barges from moving up or downriver through there.

Upper Mississippi River Locks 11 through 27 from the Illinois-Wisconsin boarder to St. Louis have been closed on and off over the past three months due to flooding conditions. As of June 16, the United States Army Corps of Engineers (USACE) reported Lock and Dam 24, Lock and Dam 25, Mel Price Locks and Dam, Locks 27 and Costello Lock and Dam were still closed. Projected opening dates run from June 16 to as late as June 23.

Here is a link to the USACE St. Louis District reporting lock closures and other flood information: https://www.mvs.usace.army.mil/….

The St. Louis Harbor is closed until the river level recedes below 38 feet, which is not expected to occur until June 20, according to current forecasts. Mississippi River levels at St. Louis crested for the second time this year at 45.7 feet on June 10, 3.9 feet lower than the record level of 49.6 feet set on Aug. 1, 1993. On Sunday, June 16, the river stage was at 42.7 feet.

Here is a link to the National Weather Service hydrograph for current and future river stage forecasts at St. Louis: https://water.weather.gov/….

The Lower Mississippi River remains open below St. Louis, but barge traffic continues to be disrupted by reduced tow sizes and transit time due to restrictions of daylight-only hours under some bridges between St. Louis and the Gulf. Barges are also subject to no-wake zones that also slow their transit time to the Gulf.

"The system and everything within are stressed and upside down," said Tom Russell, Russell Marine Group. "Barge logistics are totally out of balance. Empty barge availability in New Orleans is limited and costly, and ships are backing up in New Orleans waiting for cargo deliveries. Roads and bridges in flooded areas limit rail and truck movements."

In the Southwest Pass (SWP), there is congestion due to safety protocols and high water. These protocols include daylight-only docking/undocking at midstream terminals when water levels are above 12 feet and extra tug power remains in barge fleets at all times, said Russell. "At 16 feet and above, all vessel movement will be daylight only from mile marker 233 through 90.5. Vessels anchoring in that area with a draft of 35 feet or greater will maintain a pilot on board while at anchor." Other safety protocols are also in place when New Orleans experiences heavy fog.

"Midweek, there were 15 to 20 ships in queue waiting entry," said Russell. "There are five dredges working in the SWP to maintain draft. Due to heavy flows and strong current, shoaling and sandbars are a major issue." The Southwest Pass is one of the channels at the mouth of the Mississippi River that empties into the Gulf of Mexico at the southwestern most tip of the Mississippi River.

Shoaling and sandbars will be problematic throughout the entire river system where flooding has been ongoing. In the St. Paul district, dredging continues because of shoaling and is expected to continue most of the 2019 shipping season, according to the USACE St. Paul. This may add to slowdown in traffic once barges are able to move through the river system again. The USACE St. Paul District reported on June 14 that there are currently three active channel-dredging operations in the Mississippi River, and two contract mechanical-dredge crews are mobilizing to begin the week of June 17.

BASIS, BARGE FREIGHT HIGHER; LOADED BARGES REMAIN STUCK ABOVE ST. LOUIS

According to USDA's weekly Grain Transportation Report, flooding continues to reduce the amount of barged grain on the Mississippi River and its tributaries. "So far this year, 13,194 barges of grain have been unloaded at ports on the lower Mississippi River. This is 15% fewer than last year, and 13% below the three-year average. Year-to-date tonnages of down-bound grain, at locking portions of the Mississippi, Ohio and Arkansas Rivers, were 10 million tons, 29% lower than last year and 35% lower than the three-year average."

Corn and soybean deliveries to New Orleans are near six-year lows, according to USDA, as hundreds of barges full of corn and soybeans have been kept waiting up river until water recedes. American Commercial Barge Line reported in their daily newsletter on June 14 that they currently have 629 barges destined to areas affected by adverse river conditions.

As of June 15, the Mississippi River at New Orleans was holding steady at 16.6 feet, and current predictions show that it will not drop below 16 feet until late July. "The river stage in New Orleans is now in the longest sustained flood stage level on record," added Russell. That record could likely continue as weekend forecasts called for scattered showers in the Gulf area.

Here is a link to the National Weather Service hydrograph for current and future river stage forecasts at New Orleans: https://water.weather.gov/….

Cash basis for corn and soybeans on the Upper Mississippi River have strengthened for July and August delivery in anticipation of the river being nearly back to normal, allowing terminals to load out barges to move up and down river through St. Louis once again. Barge freight in that same area is high for the first two weeks of July and stays strong through the month, as there will be a big demand for empties. Basis has also been stronger in the Lower Mississippi River area as buyers need to get corn and soybeans to the Gulf for waiting ships.

"Sooner or later, flood waters will recede," said Russell. "However, the consequences and repercussions will be felt for some time before returning to normal."

Mary Kennedy can be reached at mary.kennedy@dtn.com

Follow her on Twitter @MaryCKenn

(BE/AG)

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