Date: Jan 30, 2019
Congestion on the Mississippi and Illinois rivers and plummeting temperatures and snow and ice in the Midwest are holding up ferroalloys movements, although prices of these commodities have, so far, not been affected, market sources said Tuesday.
High water levels on the lower Mississippi — a problem since mid-December — and worsening ice conditions on the Illinois River have resulted in smaller-than-usual convoys of laden barges moving north.
Watco, a major logistics, warehousing and railroad freight loading operation, is closing its railroad loading facility in Chicago on Wednesday because of forecasts for extremely cold temperatures, according to letters to customers seen by S&P Global Platts. It is planning to resume operations on Thursday. Forecast temperatures in Chicago are expected to plummet to a record overnight low of minus 22 degrees Fahrenheit (minus 30 degrees Celsius) on Thursday night into Friday morning, potentially making it colder than Antarctica, according to meteorologists.
High water on the lower Ohio River over the weekend has reportedly receded, and barges were said to be moving again after some delays, but in smaller-than-usual convoys.
Two ferroalloys traders said they had been advised that the high water conditions in the lower Mississippi had resulted in barge convoys being limited to five to 10 barges, instead of the more customary 12, and some areas were restricted to navigating in daylight hours only.
In the Illinois River, ice has been reported at 5-6 inches thick in the Peoria Lake area, with parts of the river re-icing over after every passing barge. Current predictions suggest temperatures in most of the Illinois River are unlikely to rise above freezing over the next 30 days.
A trader said he had raised his prices for spot high-carbon ferromanganese “without resistance” because of the river conditions. He sold a single truckload to another trader at $1,350/lt, in-warehouse basis, up from previous sales of $1,330 and had other offers out at the $1,350 level. The price falls within the existing Platts weekly assessment range of $1,300-$1,370/lt, in-warehouse major US hubs. The market will next be assessed Wednesday.
Another trader said prices of ferromanganese had not really moved and thought there was enough material in key warehouses to cover any spot needs. Traders and suppliers reported varying degrees of impact from river congestion. Some said they had seen some delay, while others had not seen an impact, but expected to.
