The Mississippi river has reached its lowest water levels in over a decade due to a drought. Months of dry weather have exhausted the amount of water in the river to a point where reserves are now inadequate. The National Oceanic and Atmospheric Administration (NOAA) forecast that the drought conditions will worsen in the coming weeks. The effect is experienced by various shippers that use the waterway to ship goods out of the U.S. One of the most significant consequences is felt in grain exports. This is because over half of the grains exported from the U.S. flows through the river.
The way cargo like grains move across the Mississippi is by barges. Barges are flat-bottomed boats used primarily for transporting goods and people through canals and rivers. With water levels reaching unpreceded levels in the Mississippi, the barges cannot float, leading to the stalling of exports. Since many grain shipments rely on the river, many challenges are faced when moving them to foreign markets. However, with grains like soybeans being one of the biggest agricultural exports from the U.S., there is an urgency to find a solution.
The Impact on Barges
The barges’ capacity has taken a massive hit due to the current drought on the Mississippi river. The shallow water levels halted barges to a point where more than 2,000 barges were stuck waiting during a period. Transit time to move cargo has also increased due to the limited number of barges on the river. Before the draught, certain areas on the Mississippi allowed the towing of up to 40 barges at a time. The low water levels limited the maximum number of barges pulled simultaneously to 25 in the same location. On a large scale, this increases the number of round trips and transportation times.
Since water reserves are starting to deplete quickly, rain is the primary solution. However, it may be a while before an adequate amount of rain rises the river to normal levels. Another side effect of the limited capacity is that rates to use barges have increased compared to last year. Prices to move grains have risen close to 200%, while some locations like St. Louis have seen a 218% increase.
Movers of grains in the U.S. have begun looking for alternatives for transporting their goods domestically and internationally. The war in Ukraine has created a shortage of soybeans and grains globally, which increased the necessity of exportation. An option is to transport the grains to other seaports across the U.S. and then ship them globally. Instead of being moved by the Mississippi river, trucks and railroads will transport the grains to the ports. U.S. grain companies with other locations in foreign places like South America have also considered increasing operations in those areas.
Since foreign markets have a high demand for grains, they may want to pay higher costs for importation. If you plan on shipping goods internationally, contact A1 Worldwide Logistics at 305-440-5156 or firstname.lastname@example.org for a quote. We assist with importing and exporting grains, soybeans, and other products to or from the U.S. Although the primary method of transportation for grains is currently hampered, we will help you navigate this predicament.