Industry

Upper Mississippi River Closing Extended as Flooding Continues

Farmers and merchandisers located in areas at flood levels that needed to market crops in March and April have been harmed by the limitations placed on the inland Mississippi waterways system. Those restrictions persist into May. The inland Mississippi River system plays a major role in transporting commodities, especially soybeans and corn. Approximately 60 percent of all grain inspected is exported through the Center Gulf, which consists of the U.S. Customs Districts of New Orleans, Louisiana and Mobile, Alabama.

For farmers located on the upper Mississippi River, the pain is much worse than farmers in other regions because the upper Mississippi River is closed in the first week of December and reopens in the second or third week of March. No corn or soybeans have locked through Lock and Dam 15 (Rock Island, Ilinois) since last December. Barge companies are now trying to arrange freight for the third week in May, effectively closing off the export market to many farmers.

Source: USDA FAS

 

For the last two weeks in March, river stage for Mississippi River at Lock and Dam 15 Rock Island was well above flood level. Average stage level for the month of March 2019 was the third highest level since 1970. April has also been an extremely difficult month for the upper Mississippi River and for the waterways in general. The Army Corps reported Mississippi River at Lock and Dam 15 Rock Island crested at 22.7 feet. This is a record high in the Quad Cities and represents over 40 days of continual flooding. The previous all-time high was 22.6 feet on July 9, 1993.

As shown in the following chart, flood stage at Lock and Dam 15 Rock Island is 15 feet. In 1993, the water did not raise above the flood stage until April, which allowed some crops to flow downstream before the upper Mississippi River was shut down. There is no reason to suspect the summer of 2019 will be as bad as 1993, but May is definitely going to be very difficult for farmers and grain merchandisers in the area. The wet weather continues, as a very unusual weather system in late April produced record snowfall for this late in the season across southern Minnesota, northern Iowa, Wisconsin, and northern Illinois. The heavy wet snow added to the amount of water that ultimately must be moved down the river. Due to the importance of the Mississippi River for soybean exports, this situation is placing great hardship on farmers and merchandisers.

Source: U.S. Army Corps of Engineers (Rock Island District)
Alan Barrett
Alan Barrett

Director of Consulting

Farm Journal

Alan Barrett is Doane’s project consultant and accomplished commodity economist with more than 25 years of experience in futures and cash markets with a focus on cotton, commodity projects, non-traditional agricultural products, transportation and supply chain studies. Alan spent six years as a commodity futures broker. His expertise encompasses feasibility studies of oilseed crushing plants (soybean canola, and cottonseed), grain elevators, export elevators, shuttle elevators, grain container operations, flourmills and other processing facilities. Alan also has conducted transportation supply chain studies for grains, oilseeds, fertilizer, coal, natural gas, crude oil, and petroleum products. Alan has considerable experience in non-traditional agricultural products such as coal, coke, natural gas, chemicals, hydraulic fracturing fluid, hydraulic fracturing proppants, glycerin, fertilizer, micronutrients, salt, limestone, cement, iron ore, pig iron, and steel, especially feed ingredients. Mr. Barrett has a BS and MS in Agricultural Economics from the University of Tennessee.