Milling & Baking News - October 4, 2005 - 11

B U S I N E S S

Hurricane Rita inflicts minimal
damage on baking, grain facilities
Continued from Page 1
and Jasper, Texas, and Westlake, La., still
were closed late last week, the source said.
Flowers Foods Bakeries Group L.L.C.
facility in Houston had resumed normal operations as well by midweek, a
spokesman at the plant said.
However, the company's New Orleans
bakery, closed since Katrina hit, remained
closed, Flowers president and chief executive officer George Deese said Sept. 28

Like Katrina, resumption of business
activity depended greatly on the
restoration of electrical power and the
ability of personnel to get to work.
in a stock analyst webcast. The plant had
sustained roof and water damage but was
structurally intact, he said. Clean up was
to have begun last week but was delayed
by Hurricane Rita. The soonest the plant
might reopen was Nov. 1 and the latest
was Jan. 1, 2006, Mr. Deese said.
H.E.B. Grocery Co., which had closed
66 stores in its Houston division ahead
of Rita, had reopened 58 stores by late
Sept. 26, with those still closed located in
harder hit areas, the company said.
Railroad traffic was embargoed as Rita
approached, greatly disrupting grain
movement in the region. But after the
hurricane passed, removal of fallen trees
and downed power lines was about all
that was needed to make tracks passable.
The Union Pacific Corp., which had
2,500 miles of track affected, shut down
all south Texas yard operations at noon,
Sept. 22 and embargoed its primary
routes into southern Texas. On Sept. 26
the U.P. said, "Hurricane Rita resulted in
no catastrophic damage to the railroad's
track structure, bridges or yards." By
Sept. 28 the U.P. had lifted carload embargoes for all stations and more than
half of the trains held were again moving grain and other materials. However,
the company said most of its customers
in the Beaumont, Orange, Port Arthur
and Lake Charles areas still were not
operational late last week.
Kansas City Southern, which operates
the Kansas City Southern Railway and
the Texas Mexican Railway (Tex Mex)
in the region, repositioned its power and
equipment and put embargoes on all
commodities to, from and within most of
the region on Sept. 23. The company said
that its track structure and facilities were
largely unscathed by Hurricane Rita.
12 / Milling & Baking News, October 4, 2005

Damage to K.C.S. facilities in Beaumont
and Port Arthur, Texas, was minimal, the
K.C.S.R. said. Embargoes on the 14 stations on the Texas Mexican line were lifted Sept. 27, except for Beaumont, while
two K.C.S.R. lines remained impassible
because of downed power lines.
Preliminary reports indicated export
grain elevators at the Texas Gulf generally escaped physical damage and
would resume full operations once
power was restored and personnel returned to work, with the exception of
the Beaumont facility, which was more
in the path of the hurricane, Randy
Gordon of the National Grain and Feed
Association said last week.
There are seven export elevators in the
Texas Gulf region with combined storage
capacity of 33 million bus, Mr. Gordon
said. Calendar 2004 grain exports from
Texas Gulf elevators totaled 8.1 million
tonnes, of which 7.9 million tonnes was
predominantly hard red winter wheat,
the U.S. Department of Agriculture said.
The 10 export grain elevators in the
New Orleans region suspended operations about Sept. 21 as Hurricane
Rita approached, Mr. Gordon said. Most
had resumed operations by Sept. 26 after
navigation restrictions were lifted. Prior
to Rita, all but one of the 10 elevators had
resumed nearly 24-hour operations since
Hurricane Katrina hit.
Mississippi river navigation had
reopened to pre-Rita conditions, Mr.
Gordon said. The only safety zone on the
river, remaining from Katrina, was at the
Southwest Pass, where navigation was
restricted to daylight, one-direction only.
Hard red winter and soft red winter
wheat export inspections from the Texas
Gulf were down 40% to 58% the week
ended Sept. 22, the U.S.D.A. said. Most
export facilities had closed ahead of Rita.
Wheat basis levels for September shipment at the Texas Gulf were unquoted
last week since most export facilities
were not expected to resume loading
until after Oct. 1, traders said. Basis
levels for later shipment periods in 2005
dropped about 5c a bu.
Effects on crops in the region were
minimized by the advanced stage of harvest in many areas. Damage to the rice
crop was reported by state departments
of agriculture in Louisiana, Mississippi
and Arkansas. But rice harvest was 98%
done in Texas, 92% in Louisiana, 60% in
Mississippi and 64% in Arkansas as of
Sept. 25, the U.S.D.A. said. Lodging of
the rice crop was reported in Arkansas,
the nation's largest rice producing state.

Rice mills in the southern Louisiana
area were not significantly damaged but
some still were without power late last
week, industry sources said.
The sugar cane crop in Louisiana, the
nation's second-largest cane growing
state, was damaged by both hurricanes.
Up to 75% of the crop in south Louisiana
could be lost after Rita pushed a tidal
surge 15 miles inland, flattening cane
and leaving debris that would make
harvest difficult, participants on a tour
organized by the American Sugar Alliance and the American Sugar Cane
League said last week. Some estimated
sugar cane losses for the entire state near
$300 million, or about 50%. Harvest usually runs from mid-September through
January, but was delayed by both hurricanes. The crop was rated 32% poor
to very poor, 44% fair and 24% good as
of Sept. 25, compared with 16% poor
to very poor, 30% fair and 54% good to
excellent on Aug. 21. Planting of next
year's crop was 90% complete as of Sept.
25, with damage still unknown.
The American Sugar Refining (Domino) facility in Chalmette, La., which
processes about half of the cane grown
in Louisiana and accounts for 15% of total U.S. cane refining capacity, remained
closed for an indefinite time because of
damage from Katrina. The Imperial Sugar Co. refinery in Gramercy, La., closed
briefly by Katrina, continued to operate.
The cotton crop also suffered from
Rita, according to comments from state
departments of agriculture in the region.
With 68% of the nation's crop in the open
bowl stage and only 15% harvested as of
Sept. 25, rain likely discolored fibers and
lowered the quality of the cotton.
In the energy sector, while damage
from Hurricane Rita was less than expected, trade estimated that up to one
million barrels per day of capacity could
be lost for a month, in addition to the 900
b.p.d. already lost because of Katrina.
All crude output was shut down in the
Gulf as Rita approached and at least 16
refineries in Texas still were closed early
last week. Although most expected to
resume operations quickly, two in Port
Arthur were expected to be down about
a month. Rita also knocked 78% of the
natural gas output in the Gulf off-line, the
U.S. Minerals Management Service said.
While crude oil, gasoline, diesel, heating oil and natural gas prices rose early
last week, the increases were less dramatic
than those that followed Katrina. Still, the
impact of the consecutive hurricanes was
expected to tax refineries and keep energy
prices high. Fuel surcharges for shipping
grain and food products, in addition to
energy costs for manufacturing, have increased because of the hurricanes. MBN
bakingbusiness.com / world-grain.com

http://www.bakingbusiness.com http://www.world-grain.com

Milling & Baking News - October 4, 2005

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