November 8, 2022
Ben Doane, barge freight manager at CHS, provides an update on disrupted barge traffic and explains how supply chains could be affected.
Barge traffic is the most efficient way to move grain and fertilizer in the U.S., but recent traffic disruptions during the peak harvest and fall application season could present challenges for farmers. Ben Doane, barge freight manager at CHS, says growers should work with their grain and fertilizer representatives to plan for longer lead times and potentially higher shipping costs as the supply chain adjusts.
The Mississippi River corridor is a critical link between producers and global markets and suppliers, but drought conditions havewater levels at record lows. That’s causing navigational difficulties, particularly in the Memphis South corridor, which every northbound and southbound barge must travel through.
“Without that corridor, we don’t have a reliable river system transportation infrastructure. We have overloaded barges, boats trapped in queues and intermittent river closures,” explains Doane.
Expect transit delays and higher shipping costs
Under normal circumstances, it takes 25 or 30 days for a barge to make the round trip from the Gulf of Mexico to St. Louis, Mo. Doane says transit time is at least double that now, due to intermittent river closures and dredging operations on the lower Mississippi.
“We’re losing boat velocity, congesting fleets, reducing total load sizes and causing major inefficiencies in that corridor,” says Doane.
The inefficiencies are also causing historically high barge freight rates for shippers. Nearby markets are trading over $100 per ton in the northern corridors, double what is typical this time of year.
Choose alternative transportation options
While stalled barge traffic challenges the supply chain and access to markets, Doane says CHS is leveraging multiple delivery points and modes of transportation to meet global demand. The company is using its extensive rail network and truck fleet, as well as its soybean crushing facilities and ethanol plants, to provide reliable market access for its member cooperatives and farmer-owners.
Doane says the uncertainty caused by limited transportation options mean growers should be talking their cooperative grain and fertilizer advisors to minimize risk to their operations Without an efficient barge transportation system, he adds, other modes and delivery points will be prioritized until the situation is alleviated. “I encourage farmers to be aware of the ongoing situation, follow the markets and ask lots of questions.”