Total transportation costs for corn and soyabeans shipped through the US Gulf route increased in the third quarter of last year compared to the previous quarter, while Pacific Northwest (PNW) costs for both commodities dropped slightly, according to a United States Department of Agriculture (USDA) report.
The costs for shipping bulk grain from Minneapolis to Japan through the Gulf increased by 21.6% from an average of US$83.43 to US$101.50/tonne mainly due to an almost 104% increase in barge rates from US$17.68 to $35.99/tonne, the USDA’s Grain Transportation Report said.
Truck rates increased by 3.9% from US$14.19 to US$14.75/tonne (3.9%) while ocean freight rates dipped by 1.5% from US$51.56 to US$50.76.
However, total transportation costs remained down by almost 22% year-on-year in the third quarter, the 4 January report said.
“Although low water restrictions along the Mississippi River System (MRS) constricted barge traffic in third quarter 2023, slow third quarter export sales prevented barge rates from rising as high as during third quarter 2022, when the MRS had similar restrictions in place,” the USDA said.
Gulf route soyabean shipments fell 25% to 3.7M tonnes and accounted for 77% of total soyabean inspections, while third quarter 2023 corn inspections (at 4.4M tonnes through the Gulf) fell 25% year-on-year and accounted for 65% of total corn inspections.
For the week ended 28 December 2023, 69.8M bushels of grain were inspected, down 36% from the previous week, 19% from the same week the previous year and 39% from the three-year average.
The USA exports approximately one-quarter of the grain it produces, which includes – on average – nearly 45% of wheat, 50% of soyabeans and 20% of corn, according to the report.
About 55% of the US export grain shipments left through the Gulf region in 2019.
With lower rail and ocean rates, total transportation costs from Minneapolis to Japan via the PNW route dropped by 2.1% from US$103.46 to US$101.27/tonne for corn and by 1.4% from US$110.81 to US$109.23/tonne for soyabeans in the third quarter of 2023 compared to the previous quarter.
Rail rates dropped by 3% from US$60.92 to US$59.09 for corn and by 2% from US$68.27 to US$67.05 for soyabeans, while ocean rates were down by 3.25% for both corn and soyabeans from US$28.35 to US$27.43. Quarterly truck transportation costs were up 3.9% for both commodities to US$14.75 from US$14.19.
Year-on-year, the PNW route had seen a 16.5% drop in total transportation costs for corn from US$121.33 to US$101.27/tonne and down 15.6% for soyabeans from US$129.48 to US$109.23.
