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Low Mississippi River levels could lead to higher inflation, paying more for groceries

It cuts through the heart of the nation, winding past multiple states: the Mississippi River is one of the country's most important waterways. Right now, though, its water levels are at historic lows and it is impacting consumers at the grocery store.
Experts say low water levels for the Mississippi River will only make inflation worse, with everyone paying more at the grocery store.
Under normal conditions, all of the dirt visible in this picture would be under water in the Mississippi River near Memphis.
The Mississippi River is more than just a source of water for many communities – it's also a place that helps 500 million tons of cargo move every year. However, because of the low water levels in the river, the barges that normally carry all that are few and far between - and that will be costing everyone more.
Posted at 9:31 AM, Oct 28, 2022
and last updated 2022-10-28 12:31:36-04

MEMPHIS, Tenn. — From the banks of the Mississippi River, it's not hard to see that the river is low right now. Very low.

"It's being felt on the entire river system,” said Martin Lipinski, PhD, a professor in the department of civil engineering and director of the Intermodal Freight Transportation Institute at the University of Memphis.

In Memphis, the Mississippi River is down nearly 11 ft because of drought conditions in the Midwest.

"Right now, we are we are experiencing historic lows,” Lipinski said. “The previous low was in 1988 and this is surpassing that."

It is a huge problem for a river that moves 20% of the nation's freight.

"We move a lot of grain,” he said. “We move a lot of fertilizer and agricultural commodities."

The Mississippi River is more than just a source of water for many communities; it's also a place that helps 500 million tons of cargo move every year.

However, the barges that normally carry all that are few and far between, and that will be costing everyone more.

According to American Commercial Barge Lines, in order to deal with the low river, barges are now needing to lighten their load by as much as 30%.

That increases the price of shipping, which is up 130% from this time last year and up 260% from its three-year average, according to the USDA Grain Transportation Report. The increased cost eventually reaches consumers.

"When transportation costs rise, inflation occurs,” said John Gnuschke, who heads up 901 Economics and has studied the river's economic impact.

Gnuschke said the low river levels will only make inflation worse, with everyone paying more at the grocery store.

"It's a factor, a major factor, in the price you pay at the store,” he said. “So, when grocery prices go up, it's because the suppliers' costs have gone up and that's associated with the lack of access to easy barge traffic."

There is no easy solution to this because harvest time is coinciding with the low water levels.

"They're all trying to ship at the same time and they all harvest at the same time,” Gnuschke said, “and that's the time when the river is most likely to be lowest, which is right now."

Experts say there won't be any relief to the low water levels until there are major rains or snowmelt.

The problem is also likely to continue coming up.

"It's also a reflection of climate change,” Gnuschke said. “And the long-term problem is that we may see a long-term issue with low river flows happening more and more frequently."

It is a challenge that can be expected to be felt repeatedly in the years to come.