By Mary Kennedy
DTN Basis Analyst
The Upper Mississippi River is seeing an early opening to the 2017 shipping season thanks to warm weather in February melting ice on Lake Pepin. That's good news for grain and feed shippers as it provides another route to ship commodities downriver.
On Feb. 15, the U.S. Army Corps of Engineers (USACE) St. Paul District made their first ice measurement on Lake Pepin. Pepin is located 60 miles downriver from St. Paul, Minnesota, and is the widest naturally occurring part of the Mississippi River. It is the last roadblock for barges waiting to come upriver to open the spring shipping season.
When the USACE returned to Lake Pepin March 1, a Corps survey crew declared that the Lake was open and no future measurements were scheduled for 2017. When I mention March Madness, you likely think it's time to fill out your NCAA basketball bracket. In Minnesota this year, it meant spring-like weather in February melting ice on many of the lakes, a snowstorm in March and an early start to the Upper Mississippi River (UMR) shipping season. On March 9, the U.S. Army Corps of Engineers (USACE), St. Paul District, reported that the Motor Vessel Stephen L. Colby locked through Lock and Dam 2, near Hastings, Minnesota, around 6 a.m. It was pushing 12 barges en route to St. Paul, Minnesota.
The Corps considers the first tow to arrive at Lock and Dam 2 as the unofficial start of the navigation season, because it means all of its locks are accessible to commercial and recreational vessels. The earliest date for an up-bound tow to reach Lock and Dam 2 was March 4 in 1983, 1984 and 2000. The average start date of the navigation season is March 22. In 2016, the season opened March 13 in the early morning hours when two tows made their way through Lock and Dam 2.
An earlier start to the shipping season is good news for grain and feed shippers because it provides another source for loading commodities heading downriver. This will ease some pressure on them, especially since rail secondary freight costs have become expensive as the U.S. rail system works itself out of the logistic issues brought on the past two months by heavy snow, rain and flooding in and heading to most of the U.S. ports. Corn and soybean basis levels have been mixed due to the high freight costs and also due to demand fluctuations. The cash prices have also suffered, which is keeping farmers from getting too excited about selling anything. For the week ending March 10, the May soybean futures lost 31 cents and May corn lost 16 1/2 cents with the basis unchanged on average.
ST. LAWRENCE SEAWAY SHIPPING SEASON OPENING MID-MARCH
Because of the warm weather and little ice coverage, the St. Lawrence Seaway will open early this year on March 20. After opening the 2016 season on March 21, the Seaway closed Dec. 31, which tied with 2008 and 2013 for the longest navigation season. The Seaway consists of five Great Lakes (Superior, Michigan, Huron, Ontario and Erie); the St. Lawrence River and Seaway; 16 sets of locks; and a series of canals, rivers, and inland lakes that connect U.S. and Canadian centers of mining, manufacturing, and agriculture to the global marketplace, according to the Duluth Seaway Port Authority. Agriculture shipments are a big part of the Seaway shipping volume.
According to the St. Lawrence Seaway Management Corporation records, grain movements posted a strong performance for a third consecutive season, moving 11.266 million metric tons in 2016, which was above the five-year average and up 407,000 metric tons from 2015. Since 2014, U.S. grain traffic through the Seaway has increased 30%. In the Port of Duluth-Superior (Twin Ports), grain shipments were running nearly 25% above the Port's five-year average.
Adele Yorde, public relations director for Duluth Seaway Port Authority, told me, "Our Great Lakes shipping season is tied to the opening of the Soo Locks, set again this year for March 25. We'll see engineers and deck crews starting to show up in town for fit-out sooner than that, but no vessels moving until March 22. Looks like the first outbound vessel may be the Paul R Tregurtha, departing with a load of coal for an intra-lake delivery up to Silver Bay."
Yorde noted that the opening of the Seaway means salties (ocean-going vessels) will be making their way inland sooner this year to the Port of Duluth-Superior. The first saltie entering the port signals the opening of the grain shipping season out of the northern Minnesota-Wisconsin port. In 2016, the first saltie entered the Duluth Ship Canal April 3.
"It's been a very odd winter here in the Twin Ports -- waves lapping our shoreline in the harbor where there is typically thick ice, plus seeing nothing but deep-blue water past the Aerial Lift Bridge in January and February," said Yorde.
Odd indeed. The U.S. Coast Guard Cutter Alder normally starts breaking ice in the Twin Ports to open the canal ahead of the shipping season around March 8. This season, Mother Nature took care of that for her.
Mary Kennedy can be reached at mary.kennedy@dtn.com
Follow Mary Kennedy on Twitter @MaryCKenn
(AG/ES)
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