Arkansas River tonnage down 3% January-June, some sectors see gains

story by Ryan Saylor
rsaylor@thecitywire.com

Tonnage shipped along the Arkansas River is down for the first half of 2014, but it is not necessarily bad news according to a Fort Smith-area river operator.

According to the U.S. Army Corps of Engineers, January through June tonnage on the McClellan-Kerr Arkansas River Navigation System totaled 5.782 million tons, down 3% from the same period in 2013.

Tonnage shipped into the Arkansas River system totaled 2.449 million tons and tonnage shipped out totaled 2.152 million tons during the first six months of 2014. The inbound figure represents a 6% increase in traffic while outbound saw a decline of 14%. Internal shipping stood out, with a 12% increase representing 1.181 million tons over the same six-month period in 2013.

Marty Shell, president of Van Buren-based Five Rivers Distribution, said the overall 3% decline (which includes inbound, outbound and internal combined) did not necessarily mean the economy was slipping. In fact, he said just the opposite.

He said some food-based items are being held longer by farmers before selling and shipping, which is keeping figures for that shipping sector either flat or slightly down.

"The outbound is probably going to be comparable for grain movements," he said. "All the corn that's grown in this region all goes to the chicken farmers. The only stuff that really moves out is wheat and soybeans. What's happening is these farmers are holding onto it. You'll see the increase in a couple of months when the soybeans are ready to cut. They'll dump the wheat (at that time)."

Overall, wheat tonnage along the river is down 9% at 602,100 tons while food/farm products are unchanged at 334,150 for the first six months of the year. Soybeans are up 69% to 415,100 and could increase further as more is harvested, Shell said. He added that it would take a few months for the wheat tonnage to rebound, depending on how much longer farmers hold their wheat for sell and shipment.

"The farmers are holding onto it to get the very best price on it. You'll see the outbound number increase."

Bryan Day, executive director of the Little Rock Port Authority, said while the grains and other food-based tonnage may be flat or down, one bright spot is building materials. The minerals and building materials category increased its tonnage by 23% to 254,980 tons while increasing its sand, gravel and rock tonnage by 18%, to 1.461 million tons. Iron and steel also increased by 5% to 832,325 tons.

"I think what you could say is the manufacturing sector is on the increase," Day said of the totals.

Shell said the increases, especially in sand and gravel, show construction could be on the increase, as well. But he said the one area dragging down the tonnage reports is coal, which is down 51% over the same six-month period last year, only totaling 221,400 tons shipped along the river.

"It costs more to get it out of the ground than what you can sell it for," Shell said. "The export market for it is weak and until it corrects itself, it will drag everything down."

And even though a big drop like what coal experienced is driving down the overall numbers, Shell said being down only 3% is not a bad place to be. He said a move up or down 3% from last year's total is fairly normal and to be expected.

As for what the rest of the year holds, he said it looks to be steady but still a long way off from the boom years before the Great Recession of 2008.

"I would say the economy is better off than where we were a year ago right now. I still just don't have that warm fuzzy feeling just yet. But we are in a better position than a year ago. Now, we're not making leaps and bounds like we were back in 2006, '07 and '08. We're just inching forward. But we're better off than we were."

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As long as the weather holds and the Corps is able to handle potential weather hazards that could impact river flow downstream, Shell expects the final tonnage report for the year to turn out solid numbers.

"We're not knocking home runs, but getting singles and doubles," he said.

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