(The following article by Barry Shlachter was posted on the Fort Worth Star-Telegram website on September 4.)
FORT WORTH, Texas — Hurricane Katrina has thrown a stick in the spokes of a vital transportation intersection where six railroads connect with major interstates and ports that handle much of the coffee imported into the United States and half of the exported grain.
“There is going to be short-term disruption to railroads, trucking and to the ports,” said Michael Chriszt, an economist with the Atlanta Federal Reserve Bank, whose district includes New Orleans. “How much it will cost to fix all that is too early to tell.”
No trains moved in or out of the Crescent City last week, and large ports in Louisiana, Alabama and Mississippi were closed.
The London-based International Coffee Organization estimated that 96,000 metric tons of coffee damaged by Katrina in New Orleans would take a year to replace and prices may rise in the meantime.
If there was any good news it was that the hurricane hit several weeks before the corn harvest and five to six weeks before soybeans, said Darin Newsom, senior analyst with DTN, a real-time market reporting service.
“The silver lining in all this, is that it probably couldn’t have happened at a better time” for some farmers, Newsom said.
Still, those who are holding corn and soybeans from last year’s bumper crops in expectations of higher prices are stuck, he said.
“Grain terminals along the Mississippi don’t want to buy because they have nowhere to go with it,” he said.
The American Farm Bureau Federation estimated that hurricane damage to farm-related industries will cost more than $2 billion and could increase food prices.
The impact is rippling throughout agriculture.
Hurricane Katrina flattened and drenched Southern crops such as sugar cane and cotton. Its winds destroyed chicken houses and the flocks inside.
Those losses “may be the tip of the iceberg,” said Terry Francl, economist for the Farm Bureau, which is the nation’s largest general-farm organization.
Food prices could rise slightly, mainly because of higher energy costs.
Cargo originally destined for New Orleans; Mobile, Ala; and Gulfport and Pascagoula, Miss.; will be diverted. As of Thursday, only two ships had been rerouted to Houston, the Port Houston Authority said.
The freighter Indotrans Flores was redirected to Houston with a load of timber and 3,000 tons of rubber destined for Oklahoma, it said.
Steve Holcomb, vice president of Houston-based Kirby, said the majority of the company’s chemical shipments are moving through a canal connecting the Mississippi with the Gulf of Mexico, Bloomberg News reported.
CSX trains were stopped 100 miles from New Orleans, spokeswoman Meg Scheu said.
Aside from debris, four barges had landed on tracks and several bridges suffered alignment damage, she said.
Like other railroads, CSX is diverting its trains around affected areas, Scheu said.
Instead of linking with other railroads in New Orleans, it is using East St. Louis, Ill.; Birmingham, Ala.; and Memphis, Tenn.
An inspection crew was taken by helicopter into CSX’s yard in New Orleans’ Gentilly district, but it was too early to predict when trains might be able to run again in the area, Scheu said.