Low River Flows and Grain Shipping
Shipping Industry Grapples With How to Adapt to Changing Mississippi River Flows
MEMPHIS, Tenn. -- On a typical day, Pete Ciaramitaro monitors towboats from his Memphis office as they carry cargo up and down the Mississippi River.
Ciaramitaro is the director of river operations for the shipping company Southern Devall, which transports chemicals and fertilizers along the Mississippi River.
He advises captains on how to safely navigate river conditions, warning them of traffic and other obstacles ahead, which can vary greatly along the waterway.
But right now, there's one consistent condition along the length of the river: Drought.
The river has reached near-historic lows for the second year in a row, which is slowing down shipping and driving up costs for everyone from barge companies to grain elevators.
In some places, last year was the lowest the Mississippi River had fallen in nearly 35 years. Much of the basin is experiencing severe-to-extreme drought conditions again this year.
"Unfortunately, we are watching a movie sequel that none of us want to watch," said Mike Steenhoek, executive director of the Soy Transportation Coalition.
What once may have seemed unbelievable is becoming more frequent on America's watery superhighway -- and it's happening even earlier this year.
"With climate change, it looks like it's going to be an annual thing now," Ciaramitaro said.
A CRUCIAL MOMENT FOR EXPORTS
Speed is always critical in the shipping industry, but these low water conditions have come at a particularly inopportune time of year -- harvest season.
"It's the worst possible time to be dealing with a bottleneck," said Jennifer Carpenter, president and CEO of the American Waterways Operators, an advocacy group for the shipping industry.
Just as farmers are starting to harvest crops like corn and soybeans, the barge companies tasked with carrying their products downriver for global export are up against low water.
DTN's basis tracker right now shows bid prices along the river corridor south of St. Louis are as low as $1.55 below the futures contract prices for corn and soybeans at a few elevators.
About 60% of the country's grain exports are shipped down the Mississippi River, but the water has to be at least nine feet deep for vessels to travel safely.
Otherwise, they can run aground on sandbars and cause a traffic jam, like last fall, when more than 2,000 barges were at a standstill.
The American Farm Bureau Federation on Thursday offered some analysis on the river situation, noting that average drafts for barges as of Sept. 18 were down 24% between Cairo, Illinois, and the Gulf of Mexico compared to a year ago. Average tow sizes are down anywhere from 17% to 38%.
Barge rates are soaring and less grain is moving downstream. USDA showed total grain movements on the river were at 74% of 2022 shipments, as of Sept. 16.
Carpenter said grappling with weather and climate is par for the course in her industry, but more frequent swings between high and low river conditions are undeniable.
"We have to assume that's the new normal," Carpenter said. "If the same thing were to happen next year, how would we be better prepared?"
The whole industry is grappling with that question.
A CHANGING RIVER
The Mississippi River drains 40% of the country, spanning more than a million square miles, so drought anywhere in that footprint can lead to downriver impacts.
Back-to-back years of extreme drought support what research suggests: climate change is making both floods and droughts more common and more intense.
Current drought is a stark contrast to the upper river just a few months ago, when near-historic flooding shut down several locks and dams, and barges couldn't transport cargo.
Higher temperatures increase evaporation, causing drought, but warm air can also hold more moisture, leading to heavy downpours.
Even when there are regional downpours, that water doesn't always make it to the river. Mike Welvaert, a National Weather Service hydrologist based near Minneapolis, said drought can exacerbate that problem.
"We're so far behind normal that we just can't catch up," Welvaert said.
The state of Louisiana and the federal government also have declared a state of emergency as low river levels allow saltwater to intrude up from the Gulf of Mexico, threatening the drinking water supply for hundreds of thousands of people.
Some stretches of the river were already nearing record lows by mid-September after an early, persistent drought swept through much of the country.
"Barge companies are announcing load restrictions, low water stages are being exceeded in multiple cities and short-term relief is frankly uncertain at this point," said Mitch Reynolds, mayor of La Crosse, Wisconsin, at a gathering of Mississippi River mayors in mid-September.
That coalition, the Mississippi River Cities and Towns Initiative, has requested more comprehensive national drought policies, which they say are critical to the future of navigation on the waterway.
They brought policy proposals to the federal National Drought Resilience Partnership on Sept. 26, including compensating farmers for drought adaptations, creating watershed-scale management policies and awarding federal funds to drought-stricken states.
Colin Wellenkamp, executive director of the mayoral coalition, said their recommendations were positively received.
While there are plenty of long-term fixes to consider, Wellenkamp said, federal disaster relief is crucial in the short-term.
CASCADING ECONOMIC IMPACTS
In the absence of rainfall to replenish the river and its tributaries, shippers are forced to cut back on the amount of cargo they load on each barge.
Lighter barges are less likely to have trouble on their journey down a low river. In some places, shippers are being forced to put 15% less cargo on each vessel.
A towboat pushes a string of barges along the river, but it's harder to maneuver down the narrower channel of a lower-level river, so each towboat pushes fewer barges at a time. That means less cargo in each barge and fewer barges in each tow, creating a logistical nightmare as shippers and vessels vie for limited space.
Ciaramitaro's fleet mostly carries chemicals and fertilizers, which are lighter than dry cargo, so restrictions haven't impacted them in the same way as barges carrying things like corn or soybeans.
But they're still bearing the brunt of more expensive freight rates and delayed traffic.
"You don't know who's going to run aground next or how long the dredge is going to have the channel closed," Ciaramitaro said.
Typically, barges are the most efficient way to transport large amounts of cargo -- one barge carries the same amount as 35 train cars or 134 semi-trucks -- but current restrictions combined with potential traffic make barges slower and more expensive.
Shippers are being told to expect up to three-day delays, and rates have doubled for barges leaving from Memphis and St. Louis compared to the three-year average.
Farmers can opt to transport their crops using trucks or trains. In some cases, it may be cheaper than current barge rates for some farmers, but it's still more expensive than a typical harvest season.
"What farmers were reminded of last year -- and this is only going to be reiterated this year -- is the importance of having options B, C and D," said Steenhoek of the Soy Transportation Council.
A ROUTE FORWARD
To make the river navigable, the U.S. Army Corps of Engineers routinely dredges the Mississippi, removing sediment and debris from the riverbed and making the navigation channel deep enough for barges. But periods of intense drought require more dredging.
After last year's lows, the Corps' Mississippi Valley Division said in a statement it started work earlier this year, dredging at known hot spots that need more frequent maintenance as early as mid-June and contracting extra dredges.
In dire situations, the Corps can also release water from upstream reservoirs to replenish the waterway.
The Corps' research budget, which hit historic highs this year, could be used to improve forecasting for inland waterways and better predict future drought impacts.
Whatever the industry does to combat drought -- dredging and special water releases to make the river navigable, or adjusting how and where they transport cargo -- will have far-reaching impacts. Consumers will eventually absorb some of the costs. The drought is also hurting crop production, which hurts other agricultural sectors.
"The whole economy will be feeling the ripple effects," said Angela Antipova, a professor and transportation studies researcher at the University of Memphis.
The industry is eyeing long-term fixes, like improving vessels, investing in better predictive software, expanding dredging and updating aging infrastructure -- although the question of who should pay for those updates is up in the air.
But there are existing frameworks that can guide the industry through tumult, said Craig Philip, a civil engineering research professor at Vanderbilt University and the former president and CEO of Ingram Barge.
Philip was one of the industry officials who helped, decades ago, to create the U.S. Coast Guard and Army Corps' Waterways Action Plans, which are contingency plans to keep traffic moving during extreme conditions on the Mississippi River.
The plans facilitate communication between multiple state governments, agencies and the Corps, and provide guidance for when to issue public safety notices, restrict barges and dredge.
The river fluctuates seasonally, so Philip said the industry anticipates problems every year somewhere in the system. But now, he considers it a chronic problem.
"The industry is now contending with the fact that these disruptions are going to be interrupting things more often than they used to," Philip said.
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For more from DTN on this subject, see DTN Cash Grains Analyst Mary Kennedy's Cash Market Moves column for this week and watch Friday for an update from her:
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Reporters Madeline Heim of The Milwaukee Journal Sentinel and Eric Schmid of St. Louis Public Radio and DTN Ag Policy Editor Chris Clayton also contributed to this article.
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Editor's Note: This article is a product of the Mississippi River Basin Ag & Water Desk, an independent reporting network based at the University of Missouri in partnership with Report for America, funded by the Walton Family Foundation.
DTN/Progressive Farmer serves as a newsroom partner for the Ag & Water Desk. DTN Ag Policy Editor Chris Clayton serves as an expert journalist to help support the reporters and editors who collaborate on the project. To learn more about the project, visit https://agwaterdesk.org/…
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