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Serving: Central

Katrina's ripple effect on harvest

The Port of New Orleans and the Mississippi River are open to barge traffic, according to a spokesman with the U.S. Coast Guard. But the port itself will remain inoperable until power is restored and operators allowed to return.

A Corps of Engineers employee put it as politely as possible, when asked about the situation. “Right now, we are concerned with getting the water out of New Orleans and saving as many lives as possible. I have no idea when the port might reopen.”

The loss of the port could have a significant ripple effect on the U.S. harvest of corn and soybeans, according to grain elevator operators up and down the river. U.S. agriculture has neither the storage capacity to wait out a bottleneck, nor a good alternate route to ship commodities.

While it's not time to panic yet, time is short. The bulk of the U.S. corn and soybean harvest traditionally moves down the river from October to February.

According to Deborah Seidel with Bunge, “Our facility in New Orleans is basically fine. My understanding is that barge traffic can move in and out.”

When asked when the facility might again be operational, she said, “It's out of our control. I haven't heard any news reports. We have a couple of employees who have gotten back in and they've been able to assess that there is no significant damage to the facility.”

River traffic on the Mississippi is actually starting to return to normal, after operating under low-water restrictions for several weeks prior to Hurricane Katrina. The restrictions meant that most barge owners were allowing only 9 feet of draft in barges, meaning the barges were loaded at roughly 65 percent to 75 percent of capacity.

“What that means is you have to use a lot more barges to load the same number of bushels. That has had and is still having a tremendous effect on the cost of barge freight,” said Steve Nail, Farmers Grain Terminal, Greenville, Miss.

Rains in the Ohio River Valley, ironically from the remnants of Hurricane Katrina, are helping push the river back up to normal levels. “Our forecast is for the river levels to come up,” Nail said. “Most of the barge companies are now allowing us to load full drafts without restrictions. That will be a big help.”

David Work, port director of the Port of Rosedale (Miss.) hasn't seen a bottleneck develop because of the hurricane. But he hasn't seen the waters rise yet. “I'm loading corn for Bunge because the water has been so low that they couldn't get barges into their dock. But as far as I know, cargo is still moving.”

Mike Logue with the Corps of Engineers, in Vicksburg, noted that the Tennessee Tombigbee Waterway, which leads to the Port of Mobile, could accommodate additional barge traffic. But the Port of Mobile is also currently out of commission. “I imagine that the industry might have to develop some kind of alternative shipping route. Right now, we're still trying to stop the water from covering up New Orleans.”

Alan Blaine, Extension soybean specialist, Mississippi State University, said if the port at New Orleans remains inoperable for an extended period of time, “it's going to hurt us. I hope our leaders are thinking about this. It has far-reaching effects.

“We don't have enough on-farm storage for the river to totally shut down, and the crushing facility at Marks, Miss., can't crush enough soybeans to keep us running. And we're in better shape than some others because we already have some of our crops harvested.”

Nail says the loss of the New Orleans port “would have tremendous impact. But it's too early to draw any conclusions about what the next few weeks are going to be like.

“From our understanding, the export elevator owners are trying to determine their situation. The Coast Guard is letting some tow boats down the river to start collecting barges and getting things back in fleets. It's going to take a little time. Power is the biggest concern, whether facilities have power or can get power restored and how long it will take. Communications are a concern, too.”

Nail says many Mid-South elevators are fairly full today, due to the ongoing harvest in the Mid-South and the low-water restrictions on river transportation prior to the hurricane, which slowed traffic.

“If they can clear up the Gulf in the not too distant future, things will return to somewhat more normal. Of course, exports are practically suspended for now and it will take a while for that to get going again.”

For now, Nail says, “We're still loading and shipping. We don't plan to do anything different unless barge owners or export elevators require us to.”

Nail added, “The harvest from the South is not really the major concern that the ports would have long-term. If the harvest from the Midwest starts and needs barges and exports going out of the country to keep harvest going, that's where the crunch will really be felt.”

He said if the port remains closed as the Midwest harvest approaches, “I don't know if there is a satisfactory backup plan. There's no railroad to speak of in this part of the world. I doubt there are enough trucks around to really make an impact on moving the rest of the harvest somewhere else.

“What will probably happen (short-term) is that freight will get loaded and sit upstream in the fleet until things get sorted out. Just because we load a barge doesn't mean it immediately heads south.

“But we certainly haven't felt the worst impact,” he said. “We're struggling with economics. The (people of New Orleans) are struggling with life and death.”


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