Feds move to ease Ag supply chain problems

On November 9, the White House announced immediate and near-term steps to ease supply chain issues.

One immediate step includes funding a Georgia Port Authority pop-up container yard project to alleviate congestion at the Port of Savannah. This project will allow the Georgia Port Authority to reallocate more than $8 million to convert existing inland facilities into five pop-up container yards in Georgia and North Carolina.

Under the plan, the Port of Savannah will transfer containers via rail and truck further inland so that they can be closer to their destination.

Near-term steps include launching programs to modernize ports and marine highways with more

than $240 million in grant funding in the next 45 days; identifying projects for U.S. Army Corps of Engineers construction at coastal ports and inland waterways in the next 60 days (including a roadmap for more than $4 billion in funding to repair outdated infrastructure and deepen harbors for larger cargo ships); prioritizing key ports for modernization and expansion in the next 90
days; and announcing more than $475 million in additional funding for port and marine highway infrastructure in the next 90 days.

On November 17, the Federal Maritime Commission (FMC) announced the convening of six Supply Chain Innovation Teams to detect and implement improvements to the process and timing of return and delivery of containers to marine terminals.

The goals of the Teams are two-fold: for truckers to return an empty container to a terminal and pick-up a loaded container (known as “double move”) and to bring certainty and predictability to the “earliest return date” process, a major source of complaint and uncertainty with exporters. The Teams will consist of executives from each ocean carrier operating in an alliance and from
the marine terminal operators that serve them. The Teams will focus on improving conditions at the Ports of Los Angeles, Long Beach, New York, and New Jersey.

On November 12, the Surface Transportation Board (STB) announced it would hold a two-day public hearing on competitive switching on March 15-16, 2022, in Washington, D.C. Competitive switching refers to a shipper’s ability to access an alternate railroad through its incumbent railroad.

For example, in Canada, shippers within 30 kilometers (18 miles) of an interchange with another carrier can switch carriers, and the incumbent railroad is compensated at a pre-determined rate. In the United States, competitive switching is currently available, but the conditions under which STB grants access are less clear.

The STB can mandate a competitive switch, but a shipper must demonstrate uncompetitive conduct by the railroad. Few requests have been filed in the United States, and none have been granted.

Export Sales
For the week ending November 11, unshipped balances of wheat, corn, and soybeans for marketing year 2021/22 totaled 47.7 million metric tons (mmt), down 22 percent from the same time last year and down 2 percent from the previous week.

Net corn export sales were 0.905 mmt, down 15 percent from the previous week. Net soybean export sales were 1.383 mmt, up 13 percent from the previous week. Net weekly wheat export sales were 0.399 mmt, up 40 percent from the previous week.

Rail
U.S. Class I railroads originated 25,336 grain carloads during the week ending November 13. This was unchanged from the previous week, 13 percent less than last year, and 4 percent more than the 3-year average.

Average December shuttle secondary railcar bids/offers (per car) were $510 above tariff for the week ending November 18. This was $134 more than last week and $504 more than this week last year. There were no non-shuttle bids/offers this week.

Barge
For the week ending November 20, barged grain movements totaled 814,495 tons. This was 8 percent less than the previous week and 16 percent lower than the same period last year. For the week ending November 20, 497 grain barges moved down river—60 barges less than the previous week. There were 891 grain barges unloaded in the New Orleans region, 2 percent less than last week.

Ocean
For the week ending November 18, 37 oceangoing grain vessels were loaded in the Gulf—unchanged from the same period last year. Within the next 10 days (starting November 19), 47 vessels were expected to be loaded—22 percent fewer than the same period last year. As of November 18, the rate for shipping a metric ton (mt) of grain from the U.S. Gulf to Japan was $70.00. This was 10 percent lower than the previous week. The rate from the Pacific Northwest to Japan was $37.50 per mt, 11 percent lower than the previous week.

Fuel
For the week ending November 22, the U.S. average diesel fuel price decreased by 1.0 cents from the previous week to $3.724 per gallon, $1.26 above the same week last year. This is the first time in 9 weeks that the national average diesel price has declined.


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