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Delays to U.S. wheat exports set to persist in Harvey-hit Texas
September 5, 2017 / 8:27 PM / 16 days ago

Delays to U.S. wheat exports set to persist in Harvey-hit Texas

CHICAGO, Sept 5 (Reuters) - Disruptions and delays to U.S. wheat exports from Texas as a result of Hurricane Harvey will persist for days more, trade experts said on Tuesday, after shipments were wiped out last week by flooded railroad tracks and closed ports.

The storm came ashore on Aug. 25 and became the most powerful hurricane to hit Texas in more than half a century, closing export terminals that handle around a quarter of U.S. wheat shipments.

Railroad tracks are still under water in Texas, according to Berkshire Hathaway Inc’s BNSF Railway Co, the No. 2 U.S. railroad. Last week, BNSF and Union Pacific Corp suspended service in the flood-ravaged region, depriving exporters of a fresh supplies of grain.

BNSF rail yards in Silsbee, Galveston and Beaumont also remain closed due to flooding, while other yards have reopened with limited operations, spokesman Joe Faust said.

“There’s no doubt the interruption is going to continue for a matter of days,” said Steve Mercer, spokesman for U.S. Wheat Associates, a trade organization that promotes exports. “It’s certainly going to be some time.”

In the week ending on Aug. 31, after the storm, federal inspectors did not check any wheat for export from Texas ports, according to the U.S. Department of Agriculture. The agency must inspect grain before it is exported.

The lack of grain checks in Texas last week helped drag down total inspections of U.S. wheat for export to 251,950 tonnes, the lowest since November, according to the USDA. A week earlier, inspections in Texas alone reached 219,219 tonnes.

Exporters ship hard red winter wheat, used to make bread, from Texas to customers in countries such as Nigeria, Colombia and Brazil. So far, buyers have not been shifting purchases to other sellers due to the delays, Mercer said.

The ability of shippers to make up for downtime caused by Harvey will depend “on how well everyone works together,” said Tara Artho, president of the Texas Grain and Feed Association, an industry group.

“Once doors reopen, you can only get so many ships in here so fast,” she said.

Port operations across the Gulf Coast were resuming, although many still had restrictions on vessel draft, according to U.S. Coast Guard updates. The Coast Guard previously closed ports including Houston, Galveston and Corpus Christi. (Reporting by Tom Polansek; Editing by Marguerita Choy)

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