Force Majeure Declared as Floods Interrupt Grain Shipping on Illinois River
Flooding on the Illinois River has halted grain barges this week, and high water levels have caused futures market operator, CME Group, to declare force majeure, allowing for a delay in contracted deliveries, for all corn and soybean shipping stations for the first time in two years.
Barge operators have voluntarily stopped river traffic after heavy rains have stopped shipping stations along the river from being able to load crops. The Illinois River is forecast by the National Weather Service to soon crest at multiple locations, and the disruption to trade is not expected to last beyond the end of the month. ADM, Bunge, and Cargill, which all dominate the river, may communicate to CME that conditions on the river have improved at any point.
Eighty percent of all barge traffic on the river in the week ending June 6 was dedicated to corn, and 19% were dedicated to soybeans, according to the latest U.S. Department of Agriculture (USDA) data. If the shipping stoppage continues, the effects may ripple inland – forcing elevators to halt purchases of crops from farmers due to limited storage space.