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Expert says ag shipments shifted by low river

A grain and oilseed specialist says the water levels in the Mississippi River are slowing down the export market significantly.  Rabobank strategist Steve Nicholson tells Brownfield the impact is already being felt at the Gulf of Mexico ports with basis levels increasing above $1.50 per bushel. “There are a number of things to be paying attention to from a farmer’s perspective, you know, keeping track of that local basis because it’s going to tell you everything about how freight is moving and what kind of demand there is for your product.”

Nicholson says product is still moving, but more by rail and less by barge, and that’s costing farmers money with higher rail rates. “The gulf is just starved for product and you see these huge basis levels for corn and soybeans. You would never expect that at this time of year, but then you look into the interior and that spread has really widened out because of the huge freight levels.”

Nicholson says trains are carrying ag products to the New Orleans and Texas gulf coast areas for exports, but the possibility of a railroad strike in mid-November has ag shippers concerned.  He says the good news is demand is still good, stocks are still tight, and prices remain good for producers going forward.