Raghav Goyal

As an economist with the LSU AgCenter, I focus on how climate-driven disruptions affect agricultural markets. The recent Mississippi River droughts offer a stark example, revealing how extreme weather can affect critical trade routes and the broader farm economy.

The Mississippi River, the backbone of U.S. agricultural transportation, plays a critical role in transporting bulk commodities like corn, soybeans and wheat to global markets. In recent years, however, this backbone has faced unprecedented challenges. The droughts of 2022 and 2023 exposed the vulnerabilities of a system heavily reliant on this waterway, with significant economic consequences for the agricultural sector.

Droughts Amplify Logistical Vulnerabilities

The 2022 drought was among the most severe on record for the Mississippi River. Lower water levels disrupted barge transportation, a crucial and cost-effective mode of moving bulk agricultural goods from the Midwest to Gulf ports in Louisiana. Barge traffic, on average, accounts for 46% of U.S. grain exports, underscoring its importance. Yet, the drought reduced capacity, delayed shipments and increased costs.

From July 2022 to January 2023, agricultural exports from Louisiana ports declined by 3.9%, translating into an economic loss of $565 million. Wheat exports were particularly affected, with a sharp reduction of 350 million kilograms (771 million pounds). Other commodities, such as soybeans and corn, showed more resilience, but the disruption still highlighted systemic weaknesses.

Rising Costs and Ripple Effects

As water levels dropped, barge rates surged, creating financial strain for exporters. Ports outside Louisiana were hit even harder, with trade volumes declining by 15.1%. Some suppliers sought alternative routes, shifting exports to East and West Coast ports, which saw modest increases in trade. However, these adjustments often came with higher costs and logistical complications.

The increased costs of shipping via the Mississippi River ripple through the entire supply chain. Higher transportation expenses lead to elevated prices for agricultural products in international markets, reducing their competitiveness. For perishable goods, delays can also result in spoilage, further amplifying losses.

Lessons for Future Resilience

The Mississippi River droughts underscore the need for diversification in agricultural logistics. Relying heavily on a single route creates a significant bottleneck during extreme weather events. Investment in multimodal transport systems — combining rail, road and barges — can provide greater flexibility. Similarly, enhancing infrastructure at alternative ports, such as those on the East and West coasts, can help absorb trade volumes during disruptions. Examples include extreme weather conditions, resistant canal systems and temperature-controlled storage facilities.

The agricultural sector must also consider climate-resilient strategies, such as conservation and advanced forecasting tools. Government and industry collaboration is essential to adapt infrastructure and policies to the realities of a changing climate.

A Warning for the Future

As climate change accelerates, droughts like those on the Mississippi River may become more frequent and severe. The economic losses from such disruptions highlight the fragility of current systems and the urgency of building resilience. Ensuring the steady flow of U.S. agricultural exports requires proactive measures to safeguard the sector against future shocks.

The Mississippi River is more than a trade route — it is a symbol of U.S. agricultural strength. Protecting this vital artery from the growing threats of climate change will be crucial to maintaining the nation’s leadership in global agricultural markets.

Raghav Goyal is an assistant professor in the LSU AgCenter Department of Agricultural Economics and Agribusiness.

This article appears in the summer 2025 edition of Louisiana Agriculture.

A tugboat pushes barges down the Mississippi River near Tower Rock in Missouri on Dec. 3, 2022. Usually full of water, the low water levels exposed land to the west and vast areas along the river that are not usually exposed. Photo by Lance Cheung, U.S. Department of Agriculture