Two Weeks of Floods Disrupt U.S. Transport Economy

(Transport Intelligence)

Although not widely reported outside the U.S., the floods across the MidWest states of Iowa, Wisconsin, Missouri and Illinois have had a severe affect on the country’s transport infrastructure.

Heavy rains through mid-June resulted in flooding in many of the urban areas of these states with the evacuation of tens of thousands of people. Heavy floods have continued to flow down the Mississippi river course throughout the past week. The floods have already had a savage impact on agricultural production in what is the largest region for U.S. farming.

The effect on the North American rail network has been particularly acute. Rail lines running through the northern MidWest states have been closed with heavy damage to infrastructure such as bridges. The most severely affected companies have been Burlington Northern Santa Fe and Union Pacific, although Canadian National Railway has also been impacted badly.

The wider consequences on the rail sector have been the reduction in agricultural bulk traffic which is a key market segment for the rail roads. Overall the Association of American Railroads estimates that volumes have fallen by 4.4% in the MidWest with non-grain farm produce falling by 16% over the past week. Intermodal volumes have also fallen heavily with river barge activity on the Mississippi coming to a halt.

Road freight has been less vulnerable, although the road infrastructure, in what is a geographically vast region, has been damaged with some major highways washed-away.

This has also led to the interruption of supply chains across much of the U.S., with traffic in shipping containers to and from the West Coast ports to areas such as Chicago and the East coast badly affected.

One further impact may be higher fuel prices, with the previously buoyant bio-ethanol industry hit badly.