KANSAS CITY, MISSOURI, US — With US harvest ready to hit high gear, falling levels on the Mississippi River system are raising the cost and time it takes to move grain on the river to the Gulf of Mexico for export.

About 60% of US grain exports travel on the river system, which has seen levels drop since June. This comes after a 30-year drought in 2022 that saw the lowest recorded levels of the Mississippi River in the Memphis, Tennessee, US, region. As a result, there were more than 40 days of closures and restrictions on the river that caused price shocks throughout the supply chain.

Already this year, loading drafts and tow sizes are lower than normal, resulting in delays of two to three days, according to the Sept. 22 Grain Transportation Report from the US Department of Agriculture (USDA).

It doesn’t look like conditions will improve much before the end of the year, with a limited outlook for more moisture, said Drew Lerner, senior agricultural meteorologist with World Weather, Inc. It is possible river levels could again drop close to the record lows seen last fall.  

“We’re going to be somewhat similar to last fall,” Lerner said. “I think we will be a little bit better, but we will be dealing with low water levels through the fourth quarter.”

Every water gauge on the 400-mile stretch of the Mississippi from the Ohio River to Jackson, Mississippi, US, is at or below the low-water threshold, according to the National Oceanic and Atmospheric Administration and US Geological Survey.

A new record low, since recordkeeping started in 1954, was set in Memphis on Oct. 21, 2022, of -10.81 feet. The previous low of -10.7 feet was set on July 10, 1988. As of Sept. 25, the river at Memphis stood at -9.43 feet.  

Although October will bring a little more rain and cooler temperatures, which slows evaporation, the region won’t likely see big improvement. Mississippi River levels will likely stay at their status quo or drift down further, Lerner said. More precipitation is expected in November in the Ohio River basin but won’t be as significant in the upper Mississippi or Missouri river basins.

“We may do better for a short period of time, but it won’t stay there,” Lerner said. “I don’t see a consistent one storm right after another type of scenario.”

However, it is an El Niño year, which usually brings above-normal precipitation.

“Odds are good, starting in December and especially January through March, that we’ll see better conditions in the lower half of the basin,” Lerner said. “There is potential for improvement, but I think we’re at least two months out before we can start seeing that in a meaningful manner.”

In response to the lower levels, barge operators have instituted draft and tow size restrictions. Draft allowances are the depth a barge may sink into the water. Tow size is the number of barges a single boat can tow.

Reducing both means more barges will be needed to move the same quantity of products and more boats will be needed to move smaller groups of barges, said the American Farm Burean Federation. Pressured capacity increases competition for transportation, pushing up costs, the AFBF said.

“Barge loads have to be restricted and then it becomes more expensive, too, because they’re having to make more trips,” Lerner said. “They’ll seek other modes of transportation, like trucking, which will also raise the prices. The expense of getting the crop out of the Midwest is going to be much higher and take much longer.”

Between Cairo, Illinois, US, and the US Gulf, loading drafts for barges are down 24% from normal while tow sizes are down 17% to 38% from normal, the USDA said.

Downbound monthly grain barge rates from Cairo-Memphis increased from $14.33 per ton in August to $26.66 in September, according to USDA data. Rates were down compared to last September when they were $36.95 per ton and significantly lower than the peak of $71.40 in October 2022.

On the mid-Mississippi River, loading drafts are down 15% and tow size is reduced between St. Louis, Missouri, US, and Cairo. The spot rate at St. Louis increased 376% from $8.06 per ton to $38.34, which is slightly higher than last year’s rate of $38.10.

In 2022, barge rates did not react to lower levels until September and October, the AFBF said. That’s when rates hit their own records of more than 2,000% of their underlying benchmark.

Coming into harvest season, demand for grain transportation had been lower than average, the AFBF said, which has lessened the impact of low water levels on prices so far.

In the second quarter of 2023, barge grain movements were down from the same quarter a year ago and the previous five-year average. As of Aug. 12, total downbound barge grain at St. Louis was 10 million tons, 28% lower than the same week a year ago and 25% lower than the previous four-year average.