Join our crew and become one of the 106,891 members that receive our newsletter.

Stock photo of a barge on the Mississippi River

Stock Photo: WvW/Shutterstock

Grain Shippers Facing Mississippi River Drought Race Against Winter

Total Views: 2113
October 7, 2022

By Joe Deaux, Michael Hirtzer and Kim Chipman (Bloomberg) Shippers struggling to move grains and fertilizer along a dried-up Mississippi River are also racing to beat the start of winter in the northern Midwest, when the river freezes and commerce shuts down. 

Archer-Daniels-Midland Co., one of the world’s biggest crop traders, said in a note to its clients this week that shipments planned for the upper Mississippi River should be completed as soon as possible to arrive in time before the river’s northern reaches begin to shut down next month.

While it’s normal that barges stop moving each winter when the river freezes, the low water levels have left more than 2,000 barges downriver waiting to pass sections near Stack Island, Mississippi, and Memphis. 

“There’s always this race to get something unloaded in the northern areas — Iowa, Wisconsin, Minnesota — and have it back before the drawbridge closes behind you due to cold weather and ice accumulation,” said Mike Steenhoek, executive director of the Soy Transportation Coalition. “That becomes all the more tricky when the river isn’t functioning as efficiently as normal.” 

The low water levels on the Mississippi River, the top route for US grain and soy exporters, are raising costs and impeding shipments, making American cargoes more expensive when food inflation is already the worst in four decades. 

Shippers need the barges to get up north to drop off fertilizer and pick up one last load of corn or soybeans before heading south for winter. If they can’t, thousands of bushels will be stranded unless space can be found on more-expensive trains to the Pacific Northwest or the Gulf Coast, or until spring.

It doesn’t help that the corn and soybean harvests are lagging behind last year’s pace. Corn is just 20% harvested as of Oct. 2, and soybeans 22%.

There are two results if barges are slower to get upriver, according to Peter Meyer, Platts head of Grain and Oilseed Analytics. “The first is that barge freight goes way up, as we are seeing, it’s just skyrocketing. The second one is that supplies get backed up upriver and this could not happen at a worse time now that we are in the middle of harvest.”

US imports are getting pricier as well. Nucor Corp., the largest US steelmaker, is not planning to load barges with metal shipments for a few weeks and instead will ship by truck or rail to avoid delays, according to a person familiar with the decision. 

Near-freezing temperatures forecast later this week show that the end of the season is quickly approaching with river traffic in stretches of Minnesota and Iowa likely soon halted until March or so. A note on American Commercial Barge Line’s website shows the final loading dates from the Gulf to Dubuque, Iowa, and points north is Oct. 10, and for St. Louis Oct. 24.

“Barges sitting in NOLA today for the Upper might not be able to arrive in time,” ADM’s said in an Oct. 5 note to clients seen by Bloomberg. “Anything that can be consigned to the Upper Mississippi River should be sooner rather than later.” ADM did not respond to a request for comment.

Barge carriers are racing to fulfill contracted shipments, and also are inclined to get flat boats up the river before the freeze, otherwise they’ll have a shortage of ships to begin transporting goods south as the spring season begins.

If the river north of Quincy, Illinois, freezes before grain shipments can be moved, “It’s going to be one more big cost dropped onto our food delivery system,” Steenhoek said.

–With assistance from Elizabeth Elkin.

© 2022 Bloomberg L.P.

Unlock Exclusive Insights Today!

Join the gCaptain Club for curated content, insider opinions, and vibrant community discussions.

Sign Up
Back to Main
polygon icon polygon icon

Why Join the gCaptain Club?

Access exclusive insights, engage in vibrant discussions, and gain perspectives from our CEO.

Sign Up


Maritime and offshore news trusted by our 106,891 members delivered daily straight to your inbox.

gCaptain’s full coverage of the maritime shipping industry, including containerships, tankers, dry bulk, LNG, breakbulk and more.