U. S. Grain Flow Hits Snags Amid Record Harvest Pace – for Oct. 25, 2010

The record harvest pace of the corn and soybean crops in the U. S. Midwest was causing pockets of snags along the supply chain, backing up the movement of grains on barges and by rail, trade sources said last week.

There were concerns the bottlenecks in grain flow could worsen over the next two weeks as the harvest comes to an end.

Heavy deliveries of freshly harvested soybeans are also causing bottlenecks at grain elevators along some Midwestern rivers because of tight supplies of empty barges.

“There is a clog situation,” said Bruce Abbe, executive director of regional trade organization, the Midwest Shippers Association, in Eden Prairie, Minnesota.

With two main railroads in the upper Midwest one to two weeks behind schedule and cars sitting on the rails, things are taking a little more time to move, Abbe told Reuters.

The United States is forecast to harvest a record-large soybean crop and the third-biggest corn crop this year.

Abbe said the speedy harvest and heavy rains in Wisconsin and Minnesota earlier in the month hampered barge transport and elevators were finding it difficult to get rail cars.

The grain-loading pace along the Mississippi River was also hampered earlier in October by high river levels, even flooding, in some areas along the Illinois and Iowa border.

As a result, spot barge freight rates on the upper Mississippi River have spiked to the highest level in nearly a year, barge freight brokers said.

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