This commentary appeared in the print edition of the Jan. 6, 2020, Journal of Commerce Annual Review and Outlook.
Optimistic shipping executives across the globe are hopeful that 2020 will be without the previous year’s historically high water levels on the Mississippi River. However, given that the US Army Corps of Engineers has opened Louisiana’s Bonnet Carré spillway six times since 2008 — and prior to that, in only eight of the previous 75 years — it is clear that a more frequent high river trend has developed of late.
The heart of the United States’ 12,000-mile inland waterway system, the Mississippi River is responsible for an annual US economic impact of over $700 billion. In 2019, the global economy again endured the power of the mighty Mississippi, which sustained an all-time record high river that lasted 235 days, breaking the previous 152-day record established in 1927.
The prolonged high river of 2019 resulted in hefty operational expenses for the entire Mississippi River shipping industry, including for terminals, deep-draft vessels, barge fleets, towing companies, and more. Vessel traffic restrictions, extra horsepower requirements, and draft limitations caused the need for additional labor and machinery. Delayed operations, prompting excessive demurrage, created low asset utilization and throughput rates for terminals and vessel operators and resulted in deep-draft vessels leaving millions of dollars on the table each time they couldn’t load to the normal 47-foot draft allowance.
Since 1717, when the French built small levees to shelter the city of New Orleans, engineers have worked to control the Mississippi River. The result of that human engineering, including revetment installation and levee construction, is a faster, more restricted river that is prone to flooding. Coupled with consistently high rainfall across the Mississippi River Basin, recurring high rivers will more regularly affect shipping on the Mississippi River and thus, the global economy. While we have high hopes for a more normal river level in 2020, we are at the mercy of Mother Nature.