Market Matters Blog

Two-hundred-ninety-one grain barges moved downriver during the week ended May 4, according to the USDA Grain Transportation Report issued Thursday, May 9. That compares to 76 during the week ended April 27. There was an increase of 268 empty barges transiting through Mississippi River Lock 27, Arkansas River Lock and Dam 1, and Ohio River Lock and Dam 52 for the week ending May 4 vs. the week ending April 27.

Prior to the first week of May, heavy rain and melting snow closed 12 locks on the Mississippi and Illinois rivers for days after severe flooding caused treacherous navigation and barge accidents. As of May 9, all areas on the Mississippi and Illinois rivers were open, but safety zones and restrictions still exist at three locks on the Illinois River. The most serious damage remains at the Marseilles Lock and Dam after seven barges slammed into the gates on April 18 with a few of those barges sinking. After closing the area for gate repairs, the Corps of Engineers reopened the dam last Saturday to allow barges to move above and below the area to catch up on contractual obligations. On April 25, CME declared force majeure because of the inability for barges to load at delivery houses in a timely manner. On May 8, they lifted the force majeure with special provisions for some of the areas on the Illinois River still experiencing high water which may hamper loadings.

The Army Corps of Engineers again closed the Marseilles Lock and Dam on May 10 to draw down the pool of water between Marseilles and Dresden Island to construct a rock dike below the dam in order to allow for repairs of the gates damaged by the loose barges. In a press release from the Rock Island District of the Army Corps of Engineers, the chief of operations there stated: "Lowering the water levels will reduce the volume of water flowing through the broken gates," he said. "This reduction will result in less erosive forces placed on the rock dike and facilitate safe completion of the dike." Traffic will be restricted in that area for at least 7 to 10 days because the drawdown will cause water levels to go below the 9 feet needed to move barges. The completion of full repairs to the gates could take months, but once the pool can return to safe levels, barges may be allowed to move through the area with restrictions as designated by the Corps of Engineers and the Coast Guard.

Soybean and corn basis levels remained strong during the past week as river terminals needed delivery of both grains after having slowed or stopped delivery to their terminals during the period when the river was closed. Barge freight on all corridors of the river system has been flat with most terminals concentrating on placement of April empties that had been stalled at the height of the lock closures in April due to flooding. Barge freight on the Illinois River for the week ended May 7 was 18% lower than last year and down 21% from the three-year average with no comparison for last week as there were no quotes due to the closure in the upper Illinois River.

(ES/CZ)

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