Floods in Midwestern states in the US are posing grain transportation problems as various roads, bridges and waterways were shut down due to extensive flooding. 

 

A significant proportion of grains in the US is transported by river barges.

 

Experts say Cargill and other agribusiness companies are facing increased costs, and the shipping industry is losing around US$1 million a day due to the flooding.

 

Parking a barge costs US$100 a day plus the US$6,000 daily fee for the tow boat, which usually pushes 15 or so barges, according to state officials.

 

Flooding have caused agribusiness companies like Cargill and other shipping companies to delay shipments, thus incurring costs for parking barges and tow boats. The companies also have to fork out more to reroute truck and railroad shipments

 

It would take 60 trucks or 15 rail cars to replace a barge in terms of the amounts of grain carried.

 

Grain costs are already at record highs after extensive rains wiped out swathes of soy and corn fields in the Midwest. Transportation woes posed by the flooding is likely to worsen the situation.

 

Cargill officials said they were rerouting shipments by river and rail as railroad bridges and lines as well as more than a 200-mile stretch of the Mississippi River were shut down because of rising waters.

 

Mark Klein, a company spokesman, said all its divisions - from the grain collection units to those shipping finished products, have been affected by delays.

 

Klein said Cargill had already been working with much higher than normal river levels earlier this year, for example.

 

As orders have already been placed, the company would have to adjust despite higher transportation costs.

 

The Eden-Prairie-based Midwest Shippers Association said Monday that its members were trying to defray the costs of parked barges that cannot get through stretches of the river due to flooding. The corps of engineers has said the locks and dams along that stretch will open in a week or two, depending on water levels.

 

The river shutdown shortens a shipping season in the Upper Mississippi that was already cut short earlier by a long winter which delayed the opening of barge traffic.

 

The delays could total a month of lost productivity for a nine-month season and affect international shipments as each link in the transport chain was supposed to be carefully timed and executed.