Barge Spot Rates Drop Sharply, Despite Ongoing River Challenges
For the week of October 18, the St. Louis barge spot rate (GTR table 9) fell precipitously to $72.58 per ton from its peak of $105.85 per ton for the week of October 11. Amid uncertainty about when barge traffic will normalize, some grain shippers have delayed deliveries until later in the year, which has softened demand for barges.
Nonetheless, the spot rate remains up 130 percent from last year and up 260 percent from the 3-year average. Although spot rates have fallen, water levels on the Lower Mississippi River (LMR) continue to be an issue, with the river gauge at Memphis dropping to a record low of −10.76 feet on October 18.
On the Ohio River (which feeds a significant portion of the LMR’s water), low water levels have delayed barge traffic because of groundings and closures for dredging work. Periodic closures for dredging, as well as tow and draft restrictions, are expected to persist at least through October based on forecast precipitation.
FMC Seeks Comments on Proposed Demurrage and Detention Rule
On October 14, the Federal Maritime Commission (FMC) requested comments on a notice of proposed rulemaking (NPRM) regarding the demurrage and detention (D&D) billing practices of vessel operating common carriers, non-vessel-operating common carriers, and marine terminal operators. If adopted, the proposed rule would require these billing entities to clarify the nature of their charges and charge only the parties that they have contracts with.
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The billing entities would also be required to issue invoices within 30 days after the charges stopped accruing; allow 30 days to dispute the charges; and provide clear information on how to dispute charges. Specifically, the NPRM proposes adopting the list of minimum information to be included in D&D invoices (as codified in 46 U.S.C. 41104(d)(2)), as well asinformation that should be added to that list.
To further define prohibited practices, the NPRM also proposes clarifying which parties may be appropriately billed for D&D charges and establishing required practices for invoicing for D&D charges. Comments can be submitted here by December 13, 2022.
Iowa Waives Truck Weight Limit To Help Move Harvest
On September 30, the Iowa Governor signed a proclamation relaxing the weight limits and transportation of grain, fertilizer, and manure until October 30, 2022. During the exemption period, the weight limit and permit are waived for vehicles up to 90,000 pounds gross weight that transport corn, soybeans, hay, straw, silage, stover, fertilizer (dry, liquid, and gas), and manure (dry and liquid).
Besides expanding the gross weight limit, the waiver also covers vehicles that do not exceed the maximum axle weight limit (of 20,000 pounds) by more than 12.5 percent—as long as they comply with posted limits on roads and bridges. The waiver applies to loads transported on all highways within Iowa (except the interstate highway system).
Snapshots by Sector
For the week ending October 6, unshipped balances of wheat, corn, and soybeans for marketing year 2022/23 totaled 39.07 million metric tons (mmt), down 23 percent from the same time last year and down 2 percent from last week.
Net corn export sales for marketing year 2022/23 were 0.200 mmt, down 12 percent from last week. Net soybean export sales were 0.725 mmt, down 7 percent from last week. Net weekly wheat export sales were 0.212 mmt, down 8 percent from last week.
U.S. Class I railroads originated 23,429 grain carloads during the week ending October 8. This was a 3-percent increase from the previous week, 3 percent fewer than last year, and 1 percent fewer than the 3-year average.
Average October shuttle secondary railcar bids/offers (per car) were $2,217 above tariff for the week ending October 13. This was $217 more than last week and $2,088 more than this week last year.
For the week ending October 15, barged grain movements totaled 639,768 tons. This was 1 percent fewer than the previous week and 21 percent fewer than the same period last year.
For the week ending October 15, 414 grain barges moved down river—13 fewer barges than last week. There were 715 grain barges unloaded in the New Orleans region, 51 percent more than last week.
For the week ending October 13, 22 oceangoing grain vessels were loaded in the Gulf—31 percent fewer than the same period last year. Within the next 10 days (starting October 14), 59 vessels were expected to be loaded—11 percent more than the same period last year.
As of October 13, the rate for shipping a metric ton (mt) of grain from the U.S. Gulf to Japan was $63.75. This was 4 percent more than the previous week. The rate from the Pacific Northwest to Japan was $37.00 per mt, 3 percent more than the previous week.
For the week ending October 17, the U.S. average diesel fuel price increased 11.5 cents from the previous week to $5.339 per gallon, 166.8 cents above the same week last year.
This content was originally published here.