The cost of transporting harvested commodities down the Mississippi River is climbing. The rates are rapidly rising as shrinking water levels drive barge freight rates higher. The forecast calling for below-average rainfall isn’t offering any relief.
Bloomberg says barge spot rates on August 29 were up 49 percent from the prior week and 42 percent from last year at $23.34 per ton. USDA data says that’s 85 percent higher than the three-year average. Last year, extremely low water levels stranded more than 2,000 barges on the Mississippi River, bringing commerce to a halt on the waterway.
The Mississippi River carries more than 45 percent of all U.S. agricultural exports to ports in the South. Water levels resumed dropping in June, restricting the amount of grain allowed on each barge. In turn, that leads to a tighter supply of barges as more of them are required to transport the same amount of grain.