Flooding along US Missouri river disrupts energy logistics, grain

17 June 2011 21:14  [Source: ICIS news]

This is the Missouri riverHOUSTON (ICIS)--Flooding along the Missouri river is having far-reaching consequences for energy, grain handling and other businesses in the states of Iowa and Nebraska, sources said on Friday.

Magellan Midstream Partners resumed limited truck-loading operations from its terminal in Omaha, Nebraska - after it suspended such activity on 10 June because of flooding.

"We hope to be fully operational late next week," said spokesman Bruce Heine.

Magellan's other petroleum distribution terminals in Lincoln, Nebraska, Sioux City and Des Moines, Iowa, are fully operational and have adequate supplies to meet demand, Heine said.

The Missouri river flooding has also slowed rail shipments, leading to a tighter price discount for Iowa ethanol versus Chicago prices, especially for shipments moving east to Chicago and eventually to the New York Harbor, sources said.

The flooding has closed sections of highways in the region, forcing trucks to take longer detours.

Iowa Motor Truck Association president Brenda Neville told the Des Moines Register that there is a tremendous cost to take the highway detours, "and while some of the costs can be passed on to the shipper, that doesn't always happen".

More than 150,000 (60,750 ha) acres of Iowa farm land could be affected by the flooding, resulting in the loss of millions of bushels of grain up and down the river, the Iowa Farm Bureau said.

US CF Industries's nitrogen fertilizer complex on the banks of the Missouri river near Sioux City remained shut down on Friday as an earthen berm holds back floodwaters.

"Flood protection measures at Port Neal are working as intended and the facility remains on a temporary production halt pending the river cresting," CF spokeswoman Susan Fisher said.

Illinois-based CF temporarily halted production on 6 June at the nitrogen manufacturing complex as a precaution ahead of expected flooding.

The Port Neal Complex contains a 365,000 tonnes/year ammonia plant, two urea plants, two nitric acid plants and a urea ammonium nitrate (UAN) plant.

Flooding has also forced some grain handling operations to temporarily shut down.

Cargill's grain elevator at Council Bluffs, Iowa, is not accepting any nearby grain, according to Mark Klein, spokesman.

"Cargill will be honouring purchase contracts and customers are being contacted for alternative delivery points for June," Klein said.

The Cargill team at the company's Blair, Nebraska, corn-milling plant has been taking extra flood-mitigation measures, such as sand-bagging, and has kept the plant open, said Klein.

Utility companies running both of Nebraska’s nuclear power plants have taken the steps needed to protect them from flooding from the Missouri river, federal regulators said on Friday.

Nuclear Regulatory Commission spokesman Victor Dricks said that Omaha Public Power District’s Fort Calhoun plant near Blair and Nebraska Power Plant District’s Cooper plant near Brownville are safe.

Media reports said that flood waters are already surrounding the Fort Calhoun plant, but the water is being held back by an 8-foot (2-metre) tall flood barrier.

By: Frank Zaworski
+1 713 525 2653

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