• Weekly Market Report

Transportation: Continued Barge Woes

Bloomberg reports that “Hundreds of barges are stalled on the Mississippi River, clogging the main circulatory system for a farm-belt economy battered by a relentless, record-setting string of snow, rainstorms and flooding. Railways and highways have been closed as well, keeping needed supplies from farmers and others.”

According to Chris Boerm, who manages transportation for Archer-Daniels-Midland Co., “It’s sort of like Mike Tyson’s quote, everybody’s got a plan until you get punched in the face, right?” Boerm said by telephone. “Every day we come in and we’ve got a plan. But then it rains three inches somewhere overnight where it wasn’t expected, and the plan changes.”

The Bloomberg report goes on to say “…supplies they plan to move on one river may need to be rerouted to a different waterway, or offloaded onto a rail car or a truck, with the hope they won’t be delayed by the weather as well. For instance, when water reaches the wheel bearings on a freight car in a siding, it can’t be hauled long distances without an inspection, yet another potential delay.

At just two locks along the upper Mississippi, almost 300 barges are being held in place as a result of high water and fast currents, according to Waterways Council Inc., which tracks barge movements. And hundreds more are waiting in St. Louis, Cairo, Illinois and Memphis, Tennessee, said Deb Calhoun, the council’s senior vice president. “It’s a big bottleneck,” Calhoun said.

“We dealt with a wet fall, and then record snowfall in many places,” said Tim Eagleton, senior engineering specialist for FM Global, an industrial insurer. “Of course, all that melts and comes down the Mississippi. Not only that, but we have had 200%-plus rainfall over a large part of that basin for months, and then a record-wet May in a lot of places.’ The bottom line, according to Eagleton: “Very long duration flooding on the Mississippi River that can really start to wear on people.’’ Almost 200 miles of the Mississippi has been shut down, he said.

That could take some time, according to Jeff Graschel, service coordination hydrologist with the Lower Mississippi River Forecast Center in Slidell, Louisiana. “A lot of locations since December to January have been above flood levels, and they probably will be in June to July,’’ he said. “We have another month or two before we can get some of these areas to go below flood.’’

Have Questions?