Spring Weather Driving Logistics Issues for Grain Shippers

Looking at Logistics
Container ship pulling into port ( Pixabay/MGN )

Following flooding and heavy snows, shipping infrastructure continues to sputter mid-spring. Ken Smithmier with ClipperData recently sat down with AgDay's Clinton Griffiths to discuss how these issues could impact trade in the coming weeks.

"The first thing is the Gulf of Mexico and the Mississippi Delta region where we export about 55 percent of our grain from that region," says Smithmier. "So when you talk about lock closures, reduced barge sizes, the rivers cresting and you have a slowdown on down to the Gulf, that's going to impact loadouts." 

Smithmier says those impacts are already being seen. 

"Then the other thing is the Pacific Northwest," says Smithmier. "We've seen rail deliveries pick up out there and we've seen vessel lineups pick up as well."

He suspects buyers are currently choosing to ship through the PNW given the issues in the Gulf and a marginal uptick in soybean import demand from China. 

"As an industry we've been watching and waiting to see if China is going to come back to this market," says Smithmier.  "I mean, some demand is better than no demand."

Smithmier says that demand is really coming at a unseasonal time.

"I don't think that anybody should just rely on it," says Smithmier. "I think we need to see some structural reform with the trade deal, but we'll take the soybean demand as long as we can." 

The U.S. also isn't alone in its shifting trends for trade. 

"I think one thing to keep in mind is load outs out of Brazil have started to creep a little lower," says Smithmier. "Even though the export forecast for the country is down for beans they may have more later in the year to ship because they're not as front-loaded."