Grain backlogged as ports reopen

by Emily Wilson
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KANSAS CITY, MISSOURI, U.S. — Grain exports from Pacific Northwest ports will resume slowly but the backlog of U.S. grain that accumulated during the 10-day stoppage at 29 U.S. West Coast ports during October will persist for some time, grain industry sources say.

The lockout of dock workers, which cost the U.S. economy an estimated U.S.$1 billion to U.S.$2 billion each day, ended when a U.S. federal court granted a request from President George W. Bush to force the ports to reopen. The court’s temporary restraining order against the lockout was followed by a court mandated 80-day cooling-off period, during which ports will remain open while negotiators try to hammer out a deal.

With a dozen ocean vessels awaiting immediate loading at Pacific Northwest ports, 40 others awaiting to receive or unload non-grain cargo and 50 barges awaiting tow or port arrival, the Columbia River near Portland, Oregon, has resembled a jammed parking lot, according to Jonathan Schlueter with the Pacific Northwest Grain and Feed Association. Almost all U.S. grain exports off the West Coast go through Pacific Northwest ports.

Schlueter said the ships awaiting grain from port elevators would take wheat, maize, barley and soybeans to 10 countries. But it still may take quite awhile for them to reach their destination, he said.

"Each of those ships will require 400 to 600 rail cars that are stacked up between here and the Rocky Mountains," he said.

Those cars stopped moving after the two large U.S. railroads that serve the West Coast, Burlington Northern Santa Fe and Union Pacific, embargoed grain shipments from the nation’s heartland as the lockout persisted.

Pat Hiatte, a spokesman with BNSF, said that railroad’s embargo would remain in effect as port elevators overflowing with grain try to clear some space for new arrivals. Once shipments resume, BNSF, which carries considerably more grain to the West Coast than Union Pacific, will implement an export permit system in an attempt to match shipments with available space until the backlog disappears.

But Schlueter said it would take "many, many weeks" for the grain industry to work through its export backlog.

The North American Export Grain Association informed the industry that they estimated at least U.S.$500,000 of costs direct to the grain export industry for each additional day shipments are stopped.

"The major concern now is soybean harvest," Randy Englund, executive director of the South Dakota Wheat Commission observed. "There are major pressures on storage capacities, and the upcoming (maize) harvest will further exacerbate the situation."