Dry Bulk Ag Update

September 29, 2016

The Dry Bulk Ag Update:


From our friends at USDA

During the month of August, export grain inspections for the Great Lakes-St. Lawrence region are up 79 percent from the previous month, and up 58 percent from the same time last year. Inspections of corn and soybeans inspected for export in the region for August are up notably from last year. Grain shipments through the Great Lakes increased mainly due to increased demand for corn from Europe and Africa, and also because of higher demand for soybeans from Canada and China. During the last 4 weeks, Great Lakes export grain inspections are 44 percent above last year and 73 percent above the 3-year average.


For the week ending September 22, total inspections of wheat for export from all major export regions reached .921 million metric tons (mmt), up 52 percent from the past week, and 43 percent above last year. Weekly wheat inspections increased primarily to Asia, and were also the highest in 3 years. Inspections of corn increased 3 percent from the past week while soybean inspections dropped 49 percent. Total inspections of grain (corn, wheat, and soybeans) reached 2.63 million metric tons (mmt), down 1 percent from the previous week, up 30 percent from last year, and 49 percent above the 3-year average. Mississippi Gulf grain inspections decreased 12 percent from the previous week, but Pacific Northwest (PNW) inspections increased 43 percent. Outstanding export sales (unshipped) of grain were up for wheat and soybeans, but down for corn.


According to USDA’s September 27 Weekly Weather and Crop Bulletin, 8 to 10 inches of rain fell in several Midwestern communities from September 20 to 23. Flood levels in parts of eastern Iowa were the second highest on record since June 2008. Runoff from the rains has raised water levels on the Upper Mississippi River and caused some disruptions in barge movements. On September 28, the U.S. Army Corps of Engineers issued a status report indicating that Mississippi River Lock 17 (New Boston, IL), Lock 18 (Gladstone, IL), and Lock 20 (Canton, MO) may close beginning on October 1-4 due to high water conditions. As of September 27, St. Louis to New Orleans barge rates for grain were 420 percent of tariff ($16.76 per ton), 28 percent higher than last week, but 31 percent below the 3-year average. Barge rates could further increase depending upon the duration of the possible closures and high water conditions.


For the week ending September 22, 38 ocean-going grain vessels were loaded in the Gulf, 7 percent more than the same period last year. Sixty-seven vessels are expected to be loaded within the next 10 days, 10 percent more than the same period last year. For the week ending September 22, the ocean freight rate for shipping bulk grain from the Gulf to Japan was $30.25 per metric ton, 2 percent less than the previous week. The cost of shipping from the PNW to Japan was $16.20 per metric ton, 2 percent less than the previous week.  For the week ending September 24, barge grain movements totaled 444,350 tons, 15 percent lower than last week, and down 10 percent from the same period last year. For the week ending September 24, 281 grain barges moved down river, down 16 percent from last week; 740 grain barges were unloaded in New Orleans, up 3 percent from the previous week.

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