Water levels on the Mississippi and Ohio rivers have been steadily declining for a second consecutive year, posing potential shipping challenges along these critical US freight routes. In Cairo, Illinois, where the Ohio and Mississippi rivers merge, water levels have dropped over 6 feet (1.8 meters) in the past week, and meteorologists predict them to fall another 4 feet by the end of July, pushing the Ohio River into its low stage. This low stage becomes problematic for barges as they can run aground, narrowing shipping lanes. The situation is similarly dire in St. Louis and Memphis, where the Mississippi River could fall by another 3 and 6 feet respectively, potentially reaching their low stages.
These declining river levels are primarily attributed to the widespread drought across the Midwest and below-average rainfall in certain parts of the eastern US. Last year, the rivers experienced similarly alarming drops in water levels. The Mississippi and Ohio rivers, along with their tributaries, are vital arteries for transporting commodities such as coal, oil, natural gas, chemicals, and other freight across the country. Unfortunately, there appears to be little relief in sight, as the Midwest currently faces its highest levels of drought in over a decade, with approximately 64% of the region affected.
When water levels in these rivers decrease, it not only hampers shipping but also increases transportation costs. In order to prevent vessels from getting stuck at the bottom, barges may have to be loaded with less cargo, resulting in reduced efficiency. Low river levels can also necessitate the dredging of channels by the US Army Corps of Engineers to maintain navigability. The economic impact of last year's low river levels was estimated to be around $20 billion, highlighting the serious consequences of this issue. To counter the situation, the US Army Corps of Engineers has recently begun constructing a saltwater sill across the Mississippi in Louisiana. This measure aims to prevent seawater intrusion into the river, a risk that arises when the water levels drop too low. Notably, this is the fifth time such a construction has been necessary near Myrtle Grove, Louisiana, and the first time it has been required in consecutive years.
Currently, river traffic continues, but the forecasted further decline in water levels may soon disrupt transportation. Barge shipments along the Mississippi River have already increased from 403,000 tons in the previous week to 511,000 tons in the week ending on July 8, according to the US Department of Agriculture's weekly grain transportation report. The increased demand for barges has also led to a rise in prices, with St. Louis experiencing an approximately 11% week-on-week increase in barge rates, now reaching $10.76 per short ton.
It is worth noting that a fully loaded river barge has the capacity to carry as much as 16 rail cars or 70 semi-trucks. In total, US inland waterways transport approximately 578 million tons of cargo annually, with a significant portion relying on the Mississippi River system. As water levels continue to plummet, the potential consequences for the transportation industry and the economy at large are concerning.