Farm Futures
   Search Site:  Search Site Saturday, April 19, 2014 | Bookmark This Site   
Skip Navigation Links
Home
Markets
News
Weather
Farm Futures NOW!
Magazine Online
RSS News
Mobile
Subscribe
Reprints
Register
Login
About Us
Advertise

Drought Could Significantly Impede River Shipments of Grain and Fertilizer

As navigation channels get shallower, the Army Corps of Engineers is working to ensure the lanes stay open.

Published on: Dec 13, 2012

Sometime this winter, Mississippi River shipping lanes could very well shut down.

It's just one more dire consequence that can be blamed on the 2012 drought, which many long-range forecasters expect to carry well into next spring. According to Illinois Corn Growers Association executive director Rodney Weinzierl, the latest frustration deals with removing rock pinnacles from navigation lanes near Cape Girardeau, Mo.

"The plan is, either this January or February, to start blasting out those rock pinnacles, which have become a navigation problem due to record low water levels," Weinzierl explains.

Regardless of when the Army Corps of Engineers begins, the project will take approximately 60 days. During this time, barge traffic will be slowed as the Corps works in 12-hour daytime periods. Traffic will be restored during the night, Weinzierl explains.

SCHEDULED BLASTING: Standing on the rock pinnacles at Thebes, its easy to see just how narrow the navigation channel is on the Mississippi River.
SCHEDULED BLASTING: Standing on the rock pinnacles at Thebes, it's easy to see just how narrow the navigation channel is on the Mississippi River.

Once the rocks are removed, it will add another two feet of navigable draft space. According to Weinzierl, draft is how boat captains determine if there's enough depth for the ship. South of St. Louis, 10- to 12-foot drafts are common. On the Upper Mississippi River and Illinois River, 9-foot drafts are standard.

In early December, the draft space on the Illinois River had been reduced to 8 feet. Commercial tug boats need a 7 ½-foot draft. Weinzierl expects commercial traffic to become arduous north of Alton very soon.

"We expect grain movement to stop soon," he adds.

And the hits keep coming. Many of the river transport companies have modified contracts so they're able to charge grain elevators a storage fee if grain must sit on a barge.

Call to action

In the near term, a number of ag organizations, including the American Farm Bureau, National Corn Growers Association, American Soybean Association and The Fertilizer Institute, have penned a letter to President Barack Obama asking for assistance in two matters regarding river transportation.

First, they've requested to move on the rock pinnacle blasting as soon as possible. The Corps original time frame called for a February removal. They recently moved it up to January. Weinzierl says the ag industry would like to see work begin well before Christmas.

Secondly, the letter asks for additional water to be released from the six Missouri River reservoirs. The Mississippi River's woes stem from a reduced flow from the Missouri River, which is a result of the continued drought in the Western Great Plains.

Currently, the Corps is experimenting with releasing rates from 12,000 to 18,000 cubic feet per second. As the Corps backs off the rate, some municipalities' water supply intake pipes have started to suck air.

Weinzierl says the industry is requesting a rate of 22,000 cubic feet/second, which would help raise depth for better navigation.

 

Fertilizer supply concerns

If Mother Nature doesn't begin dumping rain on the Midwest soon, this problem could extend well into 2013. Fertilizer could become difficult to secure.

Jean Payne, president of the Illinois Fertilizer and Chemical Association, expects this will cause problems in Illinois, but may be even worse in Iowa.

"Hurricane Isaac gave Illinois an anhydrous ammonia season this fall," Payne notes. "It didn't do the same for Iowa."

Going west, the soil only gets drier. Many are praying for rain and a window to apply spring fertilizer. Hopefully that rain comes soon, as approximately 30%-60% of the upper Midwest relies on the Mississippi River to transport fertilizer, Payne adds.

Retailers don't expect rail will bail them out. The rail car capacity simply doesn't exist, particularly for UAN and anhydrous ammonia, Payne says.

"The rail cars dedicated to carrying anhydrous ammonia and UAN are already spoken for," she adds.

Back on the grain side of things, Weinzierl says rail cannot account for lost river shipping capacity. Illinois ships approximately 100 to 120 million bushels of corn south on Canadian National Railways each year. The river system usually ships 300 million bushels of corn south in just the upcoming three-month period. It's one more wrinkle in a year that's starting off with extremely low corn stocks.