Eastern Iowa companies feel varying impacts from low Mississippi River

Barge companies keeping an eye on weather, river conditions

Vanessa Miller
Published: January 13 2013 | 7:00 am - Updated: 28 March 2014 | 9:57 am in

The drought has had different effects on companies that count on the Mississippi River to transport products. In the map below to see the locations of barge terminals that companies use to ship their wares. You also can click on an anchor icon to see information about that terminal such as their storage facilities and frequently shipped wares.

Water levels along the Mississippi River are nearing all-time lows in spots crucial to the transport of materials such as coal and grain, and barge restrictions are having an economic effect on some companies – especially those involved in shipping and transporting goods south.

In Eastern Iowa, however, that influence so far has been minimal as trucking companies and local railways have not yet received additional hauling requests for materials diverted off the river. Some local grain processing plants have had to remain flexible, with river restrictions limiting the amount barges can tow and the times of day they can pass through certain areas.

“We are monitoring the situation closely and making arrangements for alternative transportation methods, in case they’re necessary,” said Archer Daniels Midland national spokesman David Weintraub, noting that the Mississippi River and entire U.S. inland waterway system are important to its global transportation network. “We are working with industry associates to help state and federal government officials understand the severity of the issue.”

Weintraub declined to say what the low-river levels have cost ADM, which has a corn processing plant in Cedar Rapids.

But industry experts have reported that if restrictions tighten, thus further limiting the amount of product barges and towing vessels can hold, the disruption could affect more than 8,000 jobs, some $54 million in wages and benefits, and 7.2 million tons of commodities worth $2.8 billion.

The American Waterways Operators, which reported the economic influence along with the Waterways Council, Inc., said those totals don’t take into account the uncertainty of the supply chain or any potential impacts that will extend into February should Mississippi River conditions worsen.

Restrictions right now authorize a 9-foot deep and 300-foot wide commercial navigation channel. A typical barge will have a 12-foot draft — meaning shippers have had to drop thousands of pounds in product per trip to meet the 9-foot restriction, said Bob Anderson, a spokesman for the Mississippi Valley Division of the Army Corps of Engineers.

Anderson told The Gazette that although he can’t predict what February holds, the weather forecast for the rest of January is promising.

Temperatures are expected to warm, causing snow melt, and rain is predicted “right where we need it,” Anderson said. With efforts to clear rock and add depth to the river in places such as  Thebes, Ill., he said, the river should remain open with no further restrictions through the end of the month.

“Our crystal ball losses its effectiveness after that,” he said. “But historically the river starts to get more runoff and rain as temperatures start to warm in February and March.”

WHAT SPRING MIGHT BRING

There is great concern for some barge companies should the river drop any lower, Anderson said. But Eastern Iowa’s land-locked transportation companies aren’t expecting a boon in business from producers and processors who typically transport by water.

“I don’t see it having a significant impact on CRANDIC,” said Jeff Woods, a spokesman for the Cedar Rapids and Iowa City Railway Co. “I wish it would be great for us, but I don’t see it having a big impact.”

If drought conditions continue into the spring and summer, however, Woods said “it will be interesting to see what happens.”

“I think you will see a big surge in rail traffic for some of the railroads,” he said. “But I don’t see it really trickling down to us. The only way I could see it helping us is if some traffic gets trucked over and loaded on the rail.”

Amy McBeth, director of public affairs for the Burlington Northern Santa Fe Railway Co., sees the same for BNSF.

“But we do have the capacity and we are able to handle some of those shipments, and we will work with our customers to meet their needs,” McBeth said of the company that covers 32,000 miles in 28 states, including Iowa.

Officials for trucking companies West Side Transport in Cedar Rapids and Heartland Express in North Liberty also said they expect the river woes to have “no impact on us at all.”

“We are more of a general commodity type hauler,” said Frank Gambish, vice president and chief operating officer with West Side Transport.

"THEY ARE GRATEFUL"

One Eastern Iowa business that has benefited from the the Mississippi's woes, however, is Dubuque-based Newt Marine Service. It has been hired as a contractor to remove rock in the river at Thebes, adding depth to the waterway and allowing it to remain open for barge traffic, said Dan Arnold, construction manager for Newt.

The company was awarded the first rock-removal contract two weeks before Christmas, Arnold said, “and we have been there since removing rock that has been causing the difficulty.”

Typically, he said, this time of year is slow and some employees are laid off for the winter.

“So they are grateful,” he said.

Rotating teams of 17 have been working 16-hour shifts seven days a week to survey, blast and then remove rock from the river base, giving it depth. So far, their efforts have succeeded in keeping the river open, even though water levels have continued to drop.

The coast guard gives crews 16 hours a day to work, closing the two-mile passage south of St. Louis during that time. Then towing vessels are allowed to pass for an eight-hour period before the river is closed again for more rock removal, Arnold said.

“It’s a challenge, and it has gotten lower since we’ve gone down there,” he said.  “I believe that, long term, we are going to need quite a bit of moisture and snow from Canada and Montana to be able to keep the river open.”

Arnold said there is a 15-mile stretch of river in jeopardy, and he’s hopeful that following this assignment in Thebes the Corps of Engineers will reassign the Newt crews to clear rock at other river locations.

As far as its other business goes, Newt doesn’t typically receive shipments from barges along the Mississippi during the winter months. But, he said, they do during the summer, and a closure would be problematic if the drought persists.

“If it stays low next summer and barges can’t come through, it could affect us then,” he said, adding that his company’s crews typically help unload barges. “If we can’t get barges here from the south because of low water levels, it will hurt us.

“We are counting on them showing up this summer.”

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