INSIGHT: Mississippi River levels hit multi-year lows, clogs US chem traffic

HOUSTON (ICIS)–Barge companies are issuing restrictions on shipments along the Mississippi River, a major artery for chemical shipments, because water levels have reached multi-year lows, with one spot reaching levels not seen in 138 years of record keeping.

• American Commercial Barge Line (ACBL), an inland barge shipper, has issued restrictions on loading drafts and tow size because of low water levels on the Mississippi.
• In some parts of the river, ACBL warned of delays of 48-72 hours because barges have less room to navigate.
• The low river levels already have caused some groundings.

RIVERS AND CHEMICALS
The Mississippi River is important to the chemical industry because it is the largest one in the US, connecting chemical plants in Louisiana and the rest of the Gulf Coast to the nation’s agricultural heartland and industrial zones in Illinois, Pennsylvania and Ohio through the connecting Illinois and Ohio Rivers.

The river is the major artery for shipments of ammonia. Styrene produced along the Gulf Coast is shipped upstream to polystyrene (PS) plants in the Midwest US.

Cumene, acetone and methyl methacrylate (MMA) are shipped by barge on the Mississippi and Ohio rivers.

Several petrochemical plants are along the river, particularly large ones that make ammonia and methanol. The following map shows many of the plants.

Source: ICIS

MULTI-YEAR LOWS FOR CRITICAL RIVER POINTS
Ingram Marine Group, one of the top chemical carriers on the Mississippi River, has said that low water levels are a persistent problem throughout the entire inland marine system.

Josh Dillingham, director of aromatics and chemical intermediates at ICIS, keeps track of the stage levels of three water gauges along the Mississippi River in Louisiana because of their proximity to chemical plants and storage terminals, particularly methanol.

All three are at levels well below their long-term averages, as shown in the following table, which shows the stage levels of the three gauges. Figures are in feet.

	16-Oct	Average	Records date from
Carrollton	2.45	7.27	Jul-86
Reserve	2.82	10.20	Dec-97
Donaldsonville	3.11	14.65	Jul-08

Source: US Army Corps of Engineers

Dillingham also keeps track of a gauge on the Mississippi River near Memphis, Tennessee. The river at that point that is much deeper than the sites of the gauges in Louisiana, making it a good indicator for the overall health of the river.

That gauge has reached its lowest level in nearly 140 years of record-keeping.

CONSEQUENCES FOR CHEMICAL SHIPPING
Low water levels make the river harder to navigate, causing barges to slow down.

When barges ground, that can create more delays because it takes time to dislodge the vessel so others can move through the river. To avoid grounding, the US Army Corps of Engineers must perform frequent dredging of shipping channels, which also limits vessel passage.

The cumulative effect of these delays makes it harder for chemical plants to ship out finished material fast enough to keep up with production rates, according to Dillingham. If the shipping bottlenecks get bad enough, then plants have to lower rates.

Similarly, if plants cannot get their feedstock delivered, they could lower rates.

Shippers also load their barges below their maximum capacity to keep their weight down, according to Dillingham. That allows the barges to navigate shallow waters, but it can further contribute to shipping backlogs caused by delays.

DISRUPTIONS TO AGRICULTURE
For US crops and fertilizers, problems began appearing in the late summer across the areas fed by the Mississippi River, said Mark Milam, ICIS senior editor for fertilizers.

The problems intensified in September when the drought worsened, Milam said.

As the harvest advanced, barge loads started shrinking to lessen the weight of the vessel, with each week becoming progressively worse, Milam said.

The measure is reducing the supply of available barge space, and Milam has heard anecdotes of rates rising as a result.

The problem is bigger for crops, since fertilizer buyers had stocked up early in the summer before the restrictions started taking effect.

Insight article by Al Greenwood.

Thumbnail shows the Mississippi River. Image by Shutterstock.