By Alan Bjerga
27 November 2012
(Bloomberg) – Mississippi River barge traffic is slowing as the worst drought in five decades combines with a seasonal dry period to push water levels to a near-record low, prompting shippers to seek alternatives.
River vessels are cutting loads on the nation’s busiest waterway while railroads sign up new business and the U.S. Army Corps of Engineers draws criticism from lawmakers over its management of the river, which could be shut to cargo from companies including Archer-Daniels-Midland Co. (ADM) next month.
“Our shippers are looking at alternate modes of transportation,” said Marty Hettel, senior manager of bulk sales for AEP River Operations, the barge unit of American Electric Power Co. (AEP), a utility owner based in Columbus, Ohio. “If you’re shipping raw materials to a steel mill in Chicago, you’re trying to figure out if you can go to Cincinnati or Louisville, Kentucky, unload it out of the barge and rail it up to the steel mill.”
The worst U.S. drought since 1956, which dried farmland from Ohio to Nebraska, will last at least through February in most areas, according to the U.S. Climate Prediction Center in College Park, Maryland. Barges on the Mississippi handle about 60 percent of the nation’s grain exports entering the Gulf of Mexico through New Orleans, as well as 22 percent of its petroleum and 20 percent of its coal.
Barge, shipping and business organizations including the National Association of Manufacturers, the U.S. Chamber of Commerce and the American Petroleum Institute in a letter today urged President Barack Obama to declare an emergency in the region, calling for “immediate assistance in averting an economic catastrophe in the heartland” of the U.S.
Jay Carney, the White House spokesman, said the administration has sought drought relief for farmers, and today referred questions about the request to the Corps of Engineers
Senator Tom Harkin, an Iowa Democrat, also said Obama must act. “We need action to increase water flow from the Missouri River into the Mississippi,” Harkin said in an e-mail. “We also need to take immediate steps to enable the destruction of rock formations under the Mississippi River, which will allow navigation with less water.”
Mississippi water levels may drop to an historic low next month. The waterway is falling in part because of the U.S. Army Corps of Engineers, which last week started reducing outflows from the Missouri River as part of an annual operating plan to ensure regions further north have adequate water.
That may help make the Mississippi too shallow to navigate by Dec. 10 from St. Louis south about 180 miles (290 kilometers) to Cairo, Illinois, where the Mississippi meets the Ohio River, according to the American Waterways Operators and Waterways Council Inc., a trade group based in Arlington, Virginia. About $7 billion worth of commodities usually travel on the Mississippi in December and January, according to the organization.
“It is imperative that the Corps review their actions to ensure they address this problem so it doesn’t impact waterborne commerce,” said Angela Graves, a spokeswoman for Marathon Petroleum Corp. (MPC), which operates a fleet of 180 barges and 15 tugboats to ship crude oil, transportation fuels and petroleum products on waterways, in a telephone interview.
December and January are historically the lowest times of year for the rivers because the fall season is usually dry and tributaries freeze, said Steve Buan, service coordination hydrologist at the U.S. North Central River Forecast Center in Chanhassen, Minnesota.
“That’s called the ice bite, the water gets made into ice and it can’t flow downstream,” Buan said.
The record low in St. Louis was minus-6.1 feet in January 1940, according to the National Weather Service. The river was at minus-1.49 feet at 1:30 p.m. on Nov. 26, and may drop to minus-5 or even minus-6 feet as measured by the river gauge in about two weeks if the weather doesn’t change and the Army Corps of Engineers drawdown of the Missouri River takes place as planned, Buan said. […]
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- Club Orlov: Dmitry Orlov and the Collapsnik Party
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- Economic Undertow
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