Barge Freight Rates Surge as Mississippi River Levels Drop
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The cost to transport America’s harvest from the Midwest to the rest of the world is soaring as shrinking water levels on the Mississippi River drive up barge freight rates — and the forecast for below-than-average rainfall offers no relief.
Barge spot rates as of Aug. 29 in St. Louis are up 49% from last week and 42% from last year at $23.34 a ton. That’s up 85% from the past 3-year average, from the released Aug. 30.
The data comes just as the U.S. prepares to begin its soybean and corn harvest, signaling another tough year for U.S. farmers who already are and fierce competition from Brazil and Russia. Last year, on the Mississippi River stranded more than 2,000 barges, crippling commerce on the vital waterway.
Water levels on the , which , have been dropping since June, restricting the amount of grain allowed on each barge. This led to a tightening of barge supply as more barges are required to transport the same amount of grain.
Transportation companies are “proactively reducing drafts as they are aware of the problems that heavier barges caused last time around,” said a grain analyst for in St. Louis. “This year it feels like the market is better prepared to handle it.”
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