In wake of Katrina, bananas still reeling and transportation in high demand
In wake of Katrina, bananas still reeling and transportation in high demand
Dole banana containers made the television networks' national broadcasts in the days following Hurricane Katrina, as cameramen panned piles of rubble in Gulfport, MS. There, amid the crushed chaos of Gulfport, the familiar red logo could be seen on containers that were twisted and washed into huge piles of debris.
The graphic images were representative of the disruption that hit Dole and Chiquita, which heavily rely on Gulfport as a key receiving point for bananas shipped from Latin America. The produce industry as a whole is also contending with disruptions from what will likely be remembered as the most destructive natural disaster in U.S. history. Hurricane Katrina made landfall east of New Orleans on Aug. 22. The storm may have killed 10,000 people in Louisiana, Mississippi and Alabama.
Marta Maitles, director of communications for Dole Fresh Fruit Co. in Westlake Village, CA, said Sept. 6, "As of today, all our employees have been accounted for [in Gulfport]. The actual port is still there, but the equipment and buildings have been severely damaged."
Asked about Doles revised distribution plans, she simply responded, Its progressing, and added that the banana market is currently characterized as demand exceeding supply.
Last week The Produce News reported Ms. Maitles comment that in Gulfport, the port is underwater. Our plan for the immediate future is to divert fruit to other port facilities. She said a northbound Dole ship was following the hurricane and was diverted to Freeport, TX. In addition to bananas, Dole is importing pineapples. They are being diverted to the same port locations as the bananas, she said Sept. 6.
Mike Mitchell, spokesman for Chiquita Brands International Inc. in Cincinnati, told The Produce News Sept. 7 that Chiquitas banana logistics and shipping operations are being relocated for the time being from Gulfport to Freeport and Port Everglades, FL.
Mr. Mitchell said, From a humanitarian perspective, we are helping employees [in Gulfport] get back on their feet. Given the forecast for Hurricane Katrina, Mr. Mitchell said that Chiquita moved 117 containers of bananas to higher ground north of Gulfport. Destruction in the area made it impossible to ship that fruit to customers, but the fruit is still good and Mr. Mitchell said that Chiquita is working through Second Harvest to give bananas to hurricane victims.
Mr. Mitchell said that the damage in Gulfport obviously is quite severe, and it will be a matter of months for them to rebuild. We are committed to Gulfport and we are working to rebuild there when it is safe to do so.
As for banana markets, Mr. Mitchell said, I dont have specific information on a public basis. I think for that first week there were probably some supply issues, but we think that those are temporary and were working to meet our customers volume commitments through alternative ports.
He said that banana-growing areas were not affected by the storm, so banana suppliers are fine.
Retailer John Ancona, owner of Anconas Market in Ridgefield, CT, said Sept. 7 that he has not yet felt the effects of Hurricane Katrina in his banana supplies.
There have been enough in the supply line so there has been no immediate interruption. In fact, we have bananas on sale for 29 cents [a pound] this week. We locked that in several weeks ago with our supplier, Bozzutos, which is based in Cheshire, CT.
As to possible disruptions later, Mr. Ancona said, It remains to be seen if things are so thrown out of whack in scheduling and delivery.
He added that news reports of large volumes of coffee being caught in New Orleans warehouses would affect coffee prices. Thus, he said a few things are right on the edge now, but weve not seen changes yet.
Banana distributor Mark Levin of M. Levin & Co. Inc. in Philadelphia said Sept. 7, Supply is definitely disrupted, and the banana market has definitely taken a jump, although they think the market will re-evaluate itself back down again in a few days. But the market did take a momentary jump. I dont know how much is real and how much is hyped up. This may have more to do with transportation than [a shortage of] fruit.
Roger Pridmore of Bama Tomato Co. Inc. in Birmingham, AL, which handles bananas, said, The banana deal is really tough.
Chiquita served Wal-Mart from Gulfport, he said, and now Wal-Mart, which also bought from Dole out of Gulfport, is buying bananas wherever they can be found. Mr. Pridmore noted that Turbana moved from Gulfport to Freeport six months ago. That was the best move they could have made. Bama Tomato is now buying fruit from Turbana.
A very difficult transportation situation for the produce industry has been made worse by Hurricane Katrina. As the nation funnels great resources to help the Gulf Coast recover from the hurricane that devastated the region on Aug. 23, many trucks are needed for the region.
Mr. Pridmore said, Trucks are real hard to get. They say FEMA is offering large amounts to tractor-trailers to take supplies to ravaged areas. It has taken our trucks; 60 percent of our trucks are moving there now. That slows getting product into Birmingham.
Produce broker Chuck Zambito of Zambito Produce Sales in Woodbury, NJ, said Sept. 6 that already-tight trucks had gotten tighter, as the federal government is paying truckers $3 a mile plus their time to layover in the hurricane-stricken areas to assist with the recovery effort. Mr. Zambito noted that this makes the produce business more difficult than ever, but he hastened to add that helping hurricane victims is by far the most important priority.
Philadelphia produce distributor Jimmy Storey of Quaker City Produce said, The only thing affecting us [in the wake of Hurricane Katrina] is the fuel prices. He said Sept. 6, I paid $5,000 for trucks the week before last. By Aug. 26, the rate for trucks from California to Philadelphia had risen to $5,600.
Mr. Storey said that he and his friend and competitor Richard Nardella of Nardella Inc. in Philadelphia had tried to ship a truckload of water to New Orleans in the days after the hurricane. We couldnt get anyone to take it down last week.
So as evacuees began arriving in Philadelphia Sept. 6, Mr. Storey said that he and the Philadelphia market, of which he is president, would turn their sights on local contributions of produce that can be consumed raw. This includes items like honeydew, bananas and packaged carrots.
Other than fuel prices, the hurricane caused no difference in our business at Quaker City, said Mr. Storey. We dont bring in anything from Mississippi or Alabama shippers at any time of year.
Mr. Ancona, the Connecticut retailer, said, We have had fuel surcharges because of fuel supply interruptions and the rising rate of freight. 'Mr. Fuel Surcharge is a new man I have on the payroll every week. There are so many vendors using the surcharges. This is the biggest thing that has affected the business related to Hurricane Katrina.
Of the surcharges, he said, I think it is probably fair. It obviously will translate to increased retails at our end, so we all end up paying, whether its for food, clothing or anything else that requires transportation. In terms of consumer goods, it is in the pipeline, so to speak, and will hurt us all. There is no way to avoid it. It cant be absorbed when it gets to a point that it takes a couple points off bottom line.
Some of the larger accounts of Bama Tomato are located in the New Orleans area, according to Mr. Pridmore. Thus, Katrina has hurt us business-wise.
On Sept. 7, Mr. Pridmore indicated that New Orleans French Quarter has continued to function and that the city has continued to buy some produce. He heard that one warehouse outside the city has continued receiving produce, but that company is not a Bama Tomato customer.
Ive heard from all the people I dealt with [in the New Orleans area], but they all left. Theyre in Dallas, Arkansas or Alabama and are not conducting business. Mr. Pridmore said, When I try call New Orleans, I cant get through.
Bama Tomato would have a very difficult time shipping to New Orleans if Mr. Pridmore had customers. The main bridge to New Orleans is closed. Water went over it and washed it out. Still, he noted, Our customers there in French Quarter are still not underwater. Its really not all gone. But, for now, were completely out of business in New Orleans.
Bama Tomato had resumed shipping to Hattiesburg in southern Mississippi. Mr. Pridmore said business is good in Birmingham and through Alabama. We run a ton of stuff to northern and central Mississippi. That business is good. But anything into New Orleans or Biloxi is over right now.
Mr. Pridmore said that the Chandler Mountain, AL, pepper deal was torn up by Hurricane Katrinas winds and rain. The Alabama tomato deal was almost over when Katrina blew through Alabama. The tomato deal had been bad anyway because of too much water and heat this year, he noted.
Mr. Pridmore said that he was taking orders from New Orleans on a wait-and-see basis on the weekend of Aug. 20-21. While his shipments to New Orleans didnt materialize, Bama Tomatos local business in Birmingham was real good on Aug. 23-24.
Winds gusted to 50 or 60 miles an hour as Katrina passed through Birmingham, but it was nothing like Ivan last year when we had 80-mile-an-hour winds, Mr. Pridmore said. Still, Katrina was powerful enough in Birmingham to knock down trees and power lines. Unlike much of Birmingham, Bama Tomato was fortunate to keep its power throughout the experience. Forty-eight-year-old Mr. Pridmore said that Birmingham was never affected by hurricanes until the last two years. We used to worry about tornadoes. Now we worry about hurricanes.
John McClung, who heads the Texas Produce Association, said that Katrinas effects on us are minimal as far as immediate impact on produce. While Texas tends to handle produce grown in Mexico, the area struck by Katrina imports Central American and South American produce, which are in different categories than what Texans tend to distribute.
What will impact us is this fuel situation, Mr. McClung said. Transportation is increasingly hard to get and [the hurricane] has jacked prices up enormously on diesel and gasoline.
Mr. McClung said that there is no question that [with] as many evacuees as we have in Texas, the the state and FEMA and the Red Cross will be [looking for] produce. But I have no measures on the magnitude of that.
Walter Strickland of Strickland Produce Inc. in Nashville, TN, said that the storm had little impact on Nashville. We had no interruptions, he said, adding that Nashville hospitals are full because of people who were moved there from New Orleans.
Hubert Nall Jr. of Hubert H. Nall Co. Inc. in Atlanta said that there were some tornadoes in the Atlanta area as Hurricane Katrina passed by, but it didnt impact the produce business. It hasnt impacted us much at all. Bananas are coming in through Houston (Freeport), and that is about it. Boy have they got a mess. But they will recover.
In a Sept. 6 statement, the Food Marketing Institute in Washington, DC, said, Food retailers and wholesalers across America [have donated] more than $20 million in financial support alone for Hurricane Katrina relief. And they are giving more than $10 million more in aid, including truckloads of food, bottled water, ice, baby formula, diapers, paper towels, cleaning supplies, disinfectant and personal hygiene items. They are using their distribution centers near the disaster areas to collect and deliver materials, dedicating trucks, drivers, transportation executives and other employees to the relief effort. Retailers are collecting millions more in contributions from customers through fundraising events, auctions and checkout donations at more than 15,000 stores. Most of the contributions are going to the American Red Cross Hurricane Katrina Relief Fund and Americas Second Harvest.
The graphic images were representative of the disruption that hit Dole and Chiquita, which heavily rely on Gulfport as a key receiving point for bananas shipped from Latin America. The produce industry as a whole is also contending with disruptions from what will likely be remembered as the most destructive natural disaster in U.S. history. Hurricane Katrina made landfall east of New Orleans on Aug. 22. The storm may have killed 10,000 people in Louisiana, Mississippi and Alabama.
Marta Maitles, director of communications for Dole Fresh Fruit Co. in Westlake Village, CA, said Sept. 6, "As of today, all our employees have been accounted for [in Gulfport]. The actual port is still there, but the equipment and buildings have been severely damaged."
Asked about Doles revised distribution plans, she simply responded, Its progressing, and added that the banana market is currently characterized as demand exceeding supply.
Last week The Produce News reported Ms. Maitles comment that in Gulfport, the port is underwater. Our plan for the immediate future is to divert fruit to other port facilities. She said a northbound Dole ship was following the hurricane and was diverted to Freeport, TX. In addition to bananas, Dole is importing pineapples. They are being diverted to the same port locations as the bananas, she said Sept. 6.
Mike Mitchell, spokesman for Chiquita Brands International Inc. in Cincinnati, told The Produce News Sept. 7 that Chiquitas banana logistics and shipping operations are being relocated for the time being from Gulfport to Freeport and Port Everglades, FL.
Mr. Mitchell said, From a humanitarian perspective, we are helping employees [in Gulfport] get back on their feet. Given the forecast for Hurricane Katrina, Mr. Mitchell said that Chiquita moved 117 containers of bananas to higher ground north of Gulfport. Destruction in the area made it impossible to ship that fruit to customers, but the fruit is still good and Mr. Mitchell said that Chiquita is working through Second Harvest to give bananas to hurricane victims.
Mr. Mitchell said that the damage in Gulfport obviously is quite severe, and it will be a matter of months for them to rebuild. We are committed to Gulfport and we are working to rebuild there when it is safe to do so.
As for banana markets, Mr. Mitchell said, I dont have specific information on a public basis. I think for that first week there were probably some supply issues, but we think that those are temporary and were working to meet our customers volume commitments through alternative ports.
He said that banana-growing areas were not affected by the storm, so banana suppliers are fine.
Retailer John Ancona, owner of Anconas Market in Ridgefield, CT, said Sept. 7 that he has not yet felt the effects of Hurricane Katrina in his banana supplies.
There have been enough in the supply line so there has been no immediate interruption. In fact, we have bananas on sale for 29 cents [a pound] this week. We locked that in several weeks ago with our supplier, Bozzutos, which is based in Cheshire, CT.
As to possible disruptions later, Mr. Ancona said, It remains to be seen if things are so thrown out of whack in scheduling and delivery.
He added that news reports of large volumes of coffee being caught in New Orleans warehouses would affect coffee prices. Thus, he said a few things are right on the edge now, but weve not seen changes yet.
Banana distributor Mark Levin of M. Levin & Co. Inc. in Philadelphia said Sept. 7, Supply is definitely disrupted, and the banana market has definitely taken a jump, although they think the market will re-evaluate itself back down again in a few days. But the market did take a momentary jump. I dont know how much is real and how much is hyped up. This may have more to do with transportation than [a shortage of] fruit.
Roger Pridmore of Bama Tomato Co. Inc. in Birmingham, AL, which handles bananas, said, The banana deal is really tough.
Chiquita served Wal-Mart from Gulfport, he said, and now Wal-Mart, which also bought from Dole out of Gulfport, is buying bananas wherever they can be found. Mr. Pridmore noted that Turbana moved from Gulfport to Freeport six months ago. That was the best move they could have made. Bama Tomato is now buying fruit from Turbana.
A very difficult transportation situation for the produce industry has been made worse by Hurricane Katrina. As the nation funnels great resources to help the Gulf Coast recover from the hurricane that devastated the region on Aug. 23, many trucks are needed for the region.
Mr. Pridmore said, Trucks are real hard to get. They say FEMA is offering large amounts to tractor-trailers to take supplies to ravaged areas. It has taken our trucks; 60 percent of our trucks are moving there now. That slows getting product into Birmingham.
Produce broker Chuck Zambito of Zambito Produce Sales in Woodbury, NJ, said Sept. 6 that already-tight trucks had gotten tighter, as the federal government is paying truckers $3 a mile plus their time to layover in the hurricane-stricken areas to assist with the recovery effort. Mr. Zambito noted that this makes the produce business more difficult than ever, but he hastened to add that helping hurricane victims is by far the most important priority.
Philadelphia produce distributor Jimmy Storey of Quaker City Produce said, The only thing affecting us [in the wake of Hurricane Katrina] is the fuel prices. He said Sept. 6, I paid $5,000 for trucks the week before last. By Aug. 26, the rate for trucks from California to Philadelphia had risen to $5,600.
Mr. Storey said that he and his friend and competitor Richard Nardella of Nardella Inc. in Philadelphia had tried to ship a truckload of water to New Orleans in the days after the hurricane. We couldnt get anyone to take it down last week.
So as evacuees began arriving in Philadelphia Sept. 6, Mr. Storey said that he and the Philadelphia market, of which he is president, would turn their sights on local contributions of produce that can be consumed raw. This includes items like honeydew, bananas and packaged carrots.
Other than fuel prices, the hurricane caused no difference in our business at Quaker City, said Mr. Storey. We dont bring in anything from Mississippi or Alabama shippers at any time of year.
Mr. Ancona, the Connecticut retailer, said, We have had fuel surcharges because of fuel supply interruptions and the rising rate of freight. 'Mr. Fuel Surcharge is a new man I have on the payroll every week. There are so many vendors using the surcharges. This is the biggest thing that has affected the business related to Hurricane Katrina.
Of the surcharges, he said, I think it is probably fair. It obviously will translate to increased retails at our end, so we all end up paying, whether its for food, clothing or anything else that requires transportation. In terms of consumer goods, it is in the pipeline, so to speak, and will hurt us all. There is no way to avoid it. It cant be absorbed when it gets to a point that it takes a couple points off bottom line.
Some of the larger accounts of Bama Tomato are located in the New Orleans area, according to Mr. Pridmore. Thus, Katrina has hurt us business-wise.
On Sept. 7, Mr. Pridmore indicated that New Orleans French Quarter has continued to function and that the city has continued to buy some produce. He heard that one warehouse outside the city has continued receiving produce, but that company is not a Bama Tomato customer.
Ive heard from all the people I dealt with [in the New Orleans area], but they all left. Theyre in Dallas, Arkansas or Alabama and are not conducting business. Mr. Pridmore said, When I try call New Orleans, I cant get through.
Bama Tomato would have a very difficult time shipping to New Orleans if Mr. Pridmore had customers. The main bridge to New Orleans is closed. Water went over it and washed it out. Still, he noted, Our customers there in French Quarter are still not underwater. Its really not all gone. But, for now, were completely out of business in New Orleans.
Bama Tomato had resumed shipping to Hattiesburg in southern Mississippi. Mr. Pridmore said business is good in Birmingham and through Alabama. We run a ton of stuff to northern and central Mississippi. That business is good. But anything into New Orleans or Biloxi is over right now.
Mr. Pridmore said that the Chandler Mountain, AL, pepper deal was torn up by Hurricane Katrinas winds and rain. The Alabama tomato deal was almost over when Katrina blew through Alabama. The tomato deal had been bad anyway because of too much water and heat this year, he noted.
Mr. Pridmore said that he was taking orders from New Orleans on a wait-and-see basis on the weekend of Aug. 20-21. While his shipments to New Orleans didnt materialize, Bama Tomatos local business in Birmingham was real good on Aug. 23-24.
Winds gusted to 50 or 60 miles an hour as Katrina passed through Birmingham, but it was nothing like Ivan last year when we had 80-mile-an-hour winds, Mr. Pridmore said. Still, Katrina was powerful enough in Birmingham to knock down trees and power lines. Unlike much of Birmingham, Bama Tomato was fortunate to keep its power throughout the experience. Forty-eight-year-old Mr. Pridmore said that Birmingham was never affected by hurricanes until the last two years. We used to worry about tornadoes. Now we worry about hurricanes.
John McClung, who heads the Texas Produce Association, said that Katrinas effects on us are minimal as far as immediate impact on produce. While Texas tends to handle produce grown in Mexico, the area struck by Katrina imports Central American and South American produce, which are in different categories than what Texans tend to distribute.
What will impact us is this fuel situation, Mr. McClung said. Transportation is increasingly hard to get and [the hurricane] has jacked prices up enormously on diesel and gasoline.
Mr. McClung said that there is no question that [with] as many evacuees as we have in Texas, the the state and FEMA and the Red Cross will be [looking for] produce. But I have no measures on the magnitude of that.
Walter Strickland of Strickland Produce Inc. in Nashville, TN, said that the storm had little impact on Nashville. We had no interruptions, he said, adding that Nashville hospitals are full because of people who were moved there from New Orleans.
Hubert Nall Jr. of Hubert H. Nall Co. Inc. in Atlanta said that there were some tornadoes in the Atlanta area as Hurricane Katrina passed by, but it didnt impact the produce business. It hasnt impacted us much at all. Bananas are coming in through Houston (Freeport), and that is about it. Boy have they got a mess. But they will recover.
In a Sept. 6 statement, the Food Marketing Institute in Washington, DC, said, Food retailers and wholesalers across America [have donated] more than $20 million in financial support alone for Hurricane Katrina relief. And they are giving more than $10 million more in aid, including truckloads of food, bottled water, ice, baby formula, diapers, paper towels, cleaning supplies, disinfectant and personal hygiene items. They are using their distribution centers near the disaster areas to collect and deliver materials, dedicating trucks, drivers, transportation executives and other employees to the relief effort. Retailers are collecting millions more in contributions from customers through fundraising events, auctions and checkout donations at more than 15,000 stores. Most of the contributions are going to the American Red Cross Hurricane Katrina Relief Fund and Americas Second Harvest.
