(Reuters circulated the following on November 23, 2009.)
CHICAGO — Burlington Northern Santa Fe initiated a permit embargo for grain shipments to the U.S. Pacific Northwest effective Monday, Nov. 23, the railway said in a service advisory.
Wet weather in the Pacific Northwest has stalled the loading of ocean-going grain vessels, leading to a backlog of railcars waiting to be unloaded at export terminals at the PNW, a major outlet for grain shipments to Asia, grain traders said.
Export terminals often suspend grain loading operations in wet weather because moisture can cause grain to sprout or mold.
BNSF said it initiated its export permit embargo “to manage the logistics pipeline during this period of adverse weather.”
The process requires grain shippers to request a permit through the Association of American Railroads, which, if granted, must be included on the bill of lading.
BNSF said it will use the permit embargo process to work through its current backlog, but it remained unclear how long that would take as it depended largely on the weather.
Traders said the permit embargo did not yet appear to have affected grain basis levels or shipping costs.
U.S. farmers have struggled through persistent fall rains to harvest what is projected to be the largest ever soybean crop and the second largest corn crop on record.
The United States is the largest exporter of corn, soybeans and wheat in the world.