The number of train cars carrying grain across he state dropped in July. The DOT’s Stuart Anderson told the Transportation Commission today that July continues what has been a downward trend.
“Which is indicative of reduced grain exports, which were served certainly seen with other measures. July carloads of grain, were down 21 percent from last July,” Anderson says. Commissioner Ray Gaesser of Corning is a grain farmer and says exports have slowed down substantially. “Both soybeans and corn, which are our major commodities, their exports are down around 30% from a year ago,” he says.
Gaesser says one of the factors is competition from South America. “China is, you know, having financial issues and they’re not buying as much either,” Gaesser says. “I know our soybean organizations are working with many, other small countries to build the markets there and diversify that portfolio.” Gaesser says production was down last year too, and the carryover of supply of corn is up 30% from one year ago.
Hauling grain on water is also an issue as Anderson says water levels have been dropping since June on the Mississippi River and are expected to continue to drop. “Primarily impacting the Lower Mississippi River. But of course all of our products need to transverse the Lower Mississippi. So that means they are not able to load the barges as full so the draft isn’t as deep,” he explains.
Anderson says that requires more barges to haul the same amount of grain — which causes other issues. “Kind of has that supply chain impact where that tightens barge transport, supply and increases rates,” Anderson says. He says this year could end up being as challenging as it was last year when there were significant impacts on the transport and barge rates.