US rail, barge prices fall tempting uptick in grain movements: USDA

US railcar and barge rates are continuing to fall as grain movements across the US slow week on week and versus last year’s figures, the USDA’s weekly grain transportation report said Thursday.

Key in undermining transport values has been the lack of produce inclined to move, with total inspections of grain for export from all US ports falling 21% on the previous week and 29% on the same time of 2016, to 2.28 million mt.

“The drop in inspections was caused primarily by the typical slowdown in demand from Asia and Latin America during this period,” with grain inspections since mid-September, according to the report.

Softer freight rates have seemingly teased out movements, with 25,712 grain carloads moving in the week ending December 2 – a rise of 37% on the previous week and 3% higher on same point of 2016.

Barge movements have also jumped up week-on-week, with 811,802 mt moving on rivers, an increase of 14% on the previous week although a 23% decline on the same period of 2016.

Over the next ten days, 61 ocean-going vessels are scheduled to be loaded in the Gulf, a 27% fall on the same period of 2016

Barge rates peaked in October, as the harvest was in full flow, at 800% of the published tariff equating to $31.92 per ton, but are now quoted at 200% of tariff, or $7.98/mt.

Railcar values have also dropped, bids and offers for secondary railcars averaged $141 below the published tariff – some $286 lower than last year.