Commodities — Grain

The company (Logsdon) that owns the barges on which we overnighted, owns four river tug boats primarily to serve the four grain elevators in the area.  They move the barges around so they can be loaded with grain and be positioned for pickup by one of the river tows for delivery to customers.

Logsdon owns the barges and tugs

Logsdon keeps a tug pilot and crew available 24/7 so they can immediately respond to a request from one of the grain elevators to load a barge.  When we arrived, the pilot and crew were not busy, so they gave us a lengthy tour of the tug.

I wondered why they need to be on call 24/7 to move a barge to be loaded with grain.  It seems like one would just wait until the next work day to move the barge.

This is the grain elevator next to our boat first thing in the morning

The explanation is that elevator owners deliver on futures and other grain commodities contracts.  These contracts can move very quickly and in order to close on a contract the grain elevator needs to have the grain loaded on the barge (Freight on Board, Barge).  These commodities are traded globally so at the right price the elevator may have a need to load one or more barges with grain immediately, even in the middle of the night.  They would need the tug to move the barge to the grain elevator for loading.

The delivery end of grain commodities contracts is quite sophisticated, even though most people never think of this.  

Comments

  1. Tom PastorSeptember 8, 2021 at 5:24 AM

    What an interesting story about the tow boats and barges. Quite the education for both of you, and me as well. 😉

    ReplyDelete
    Replies
    1. Taurus Great LoopSeptember 8, 2021 at 7:43 PM

      We are always looking for ways to learn things. The tug pilot is the one who told us their jobs all depended on the grain futures for the farmers. Who knew?!

      Delete
    2. Taurus Great LoopSeptember 8, 2021 at 7:51 PM

      The early morning grain elevator picture was taken by Fred using a 3 second exposure on the camera.

      Delete
  2. Anna MarieSeptember 9, 2021 at 6:17 PM

    Sounds like you are ready to trade in the stock exchange girl!

    ReplyDelete

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