U.S. barge fleet could shrink 17.4% by 2035, straining grain exports

By Grace Kim

The U.S. barge fleet could shrink 17.4% to 16,240 vessels by 2035 if current replacement and retirement trends persist, according to CoBank’s Knowledge Exchange in a November 10, 2026 report.

The report, “Aging inland hopper barges, rising costs could strain U.S. grain exports,” says an aging fleet, higher construction costs and recurring low water could constrain the Mississippi River export corridor. Without sustained investment in vessels and waterways, rising freight costs could weaken grain basis, pressure farm margins and reduce U.S. export competitiveness.

“The U.S. is facing a barge retirement wave,” said Tanner Ehmke, lead grains and oilseeds economist with CoBank.

Ehmke said tighter barge availability raises freight rates and weakens the basis paid to farmers. Elevators may bid less aggressively as transportation absorbs more export value. Delays can push more grain into storage, widen basis and carries, and defer shipments until freight demand eases.

The immediate risk is tighter transport capacity, not a shortage of grain.

How large is the retirement gap?

Current Data LLC reports that:

• The U.S. fleet numbered 19,668 vessels in 2026, down nearly 7.6% over the previous 10 years.
• Average barge age reached 17.6 years, up from 13.8 years in 2016. Typical hopper-barge service life is 25 to 30 years.
• Operators build roughly 410 barges annually, while annual retirements range from 500 to 1,000.
• At current trends, the fleet could fall to 16,240 barges by 2035, a 17.4% decline.

Current Data LLC provides the 2026 fleet count and the comparison with 2016. CoBank’s 2035 figure is a trend projection, while the annual build and retirement numbers describe broad industry rates rather than identified vessels already slated for disposal.

USDA projects U.S. grain and oilseed exports will increase 9% by 2035, with most of the growth coming from corn and soybeans. That figure forecasts total exports through 2035 rather than reported shipments to date. The result is a smaller, older fleet entering a period of projected export growth.

Why has fleet renewal stalled?

Steel is the largest input in barge construction, and U.S. steel plate prices remain significantly above global alternatives. Strong domestic demand and long-standing Section 232 steel tariffs keep those prices elevated. Labor, fiberglass, financing and interest costs have also risen.

A new hopper barge now costs roughly $1 million or more, compared with roughly $650,000 a decade ago. Higher construction costs keep fleet replacement below retirement.

Operators still price many transportation services using older, fully depreciated vessels bought at far lower costs. Freight rates have increased, but not quickly enough to justify large-scale replacement. Much of the industry’s investment strategy therefore remains focused on extending existing vessel lives rather than expanding capacity.

How much risk comes from low water and rail limits?

The Mississippi River moves roughly half of U.S. corn and soybean exports and one-third of wheat exports, according to USDA data. Successive years of low water have left barges unable to load to full capacity at times, and operators have often reduced tow sizes.

Aging locks and dams add vulnerability because disruptions can delay traffic and reduce system efficiency. The U.S. Army Corps of Engineers continues dredging and maintenance work, but the report says the waterway system needs ongoing investment.

Railroads provide some competition, yet equipment constraints, terminal bottlenecks and export-facility limitations restrict their ability to absorb displaced barge volumes. Barges also retain an efficiency advantage in loading and unloading bulk commodities.

Ehmke said: “Barges remain the most efficient and cost-effective method of moving grain to export markets, but transportation costs are likely to continue increasing over time, given the tightening fleet.”

He said freight values are already above historical norms, including during periods traditionally considered offseason, making a persistent headwind for U.S. grain exports. Low water and rail constraints leave barges to absorb most of the adjustment.

Could $6 billion in public investment change the outlook?

The proposed Water Resources Development Act of 2026 would provide more than $6 billion for ports, waterways and related infrastructure projects. If enacted, the legislation could improve system reliability and accelerate critical upgrades. Passage remains uncertain.

CoBank’s outlook connects the investment gap to specific farm economics: higher freight costs reduce what elevators can pay, weaker basis narrows what farmers receive, and delayed movements increase storage pressure and widen carries.

With USDA projecting a 9% increase in grain and oilseed exports by 2035, the next test is whether investment can add vessel capacity and maintain the river before a smaller fleet meets more export demand. CoBank sees rising freight, weaker basis and delayed shipments as the likely pressure points.