September 15, 2005
By DAI HUYNH
Copyright 2005 Houston Chronicle
Graphic: Seafood Losses Due to Katrina
Jim Gossen, president of wholesaler Louisiana Foods, fears Hurricane Katrina has crippled the Gulf Coast seafood industry.
"What was coming out of Louisiana has pretty much ceased — oysters, shrimp, crab," said Gossen, who supplies seafood to grocery stores and 200 restaurants in Houston and Dallas. "Fishing is nonexistent today along the Louisiana Gulf Coast."
The Louisiana Department of Wildlife and Fisheries estimates a $1.3 billion loss in fisheries revenue at the retail level and a $296 million loss in oyster revenue in the next two years. The losses result from storm-induced pollution and damage to oyster beds.
Louisiana is second only to Alaska in seafood production, harvesting about 40 percent of the shrimp, 30 percent of blue crabs and 35 percent of oysters produced in the United States. It's the country's top oyster producer, followed by Texas and Florida.
That is just the beginning of Katrina's impact on the food supply, including poultry, sugar and coffee.
Consumers can expect selective shortages of food items and price increases, some of which are already visible locally.
On Tuesday, the Kroger Signature grocery store on 11th in the Heights posted signs near its dwindling stocks of Folger's coffee, Zatarain's box dinners and Imperial Sugar.
"Due to Hurricane Katrina," the signs read, "certain plants in Louisiana have been temporarily closed. ... We apologize for any out of stock items that may be caused as a result of these closures."
Limited stock
At some Asian supermarkets, a 15-ounce can of Café Du Monde coffee and chicory, a New Orleans brand preferred by many Vietnamese, is selling for $2 to $3 more than last month because of disrupted shipping. Hung Dong Supermarket in northwest Houston has set a limit of two cans per customer while Hong Kong Food Market in Southwest Houston has sold out.
Early estimates by the American Farm Bureau Federation indicate that Katrina caused about $1 billion in damage to crops and livestock.
Katrina also hobbled transportation via rail lines, highways and waterways in Louisiana and Mississippi, severing goods from their markets.
Though many wholesalers have raised prices, a spot check of area groceries and restaurants shows that so far, retailers are reluctant to pass the increases on to customers, adopting a wait-and-see attitude.
At Captain Tom's Seafood & Oyster Bar, owner Tom Makdisi says he's paying 6 percent more for Gulf Coast oysters than in pre-Katrina days, and absorbing the cost.
"I'm not one to raise my prices rapidly. Oyster prices go up and down," said the restaurateur, who has three area locations. "But this is the first year where prices have gone up and stayed up. Let's hope it doesn't get too hefty. I buy oysters from Texas, but everybody who bought from Louisiana is now turning to Texas. With fewer oysters on the market, prices go up."
One of the biggest concerns is the industry's infrastructure, said John Roussel of the Louisiana Department of Wildlife and Fisheries.
"There has been a tremendous loss of harvesting vessels," he said. "The majority of the fleet is out of commission, and the (docks are) destroyed. At this point, shrimp, blue crab and oysters will be out of commission for a year."
Shrimp prices are unlikely to fluctuate, however, because 80 percent of shrimp consumed in the United States is from Thailand, Ecuador, Mexico, India, Indonesia, China and Vietnam. Restaurants and groceries can get crabs from other Gulf states and the Chesapeake Bay area.
Goode Co. Texas Seafood is paying about $2 more per gallon of shucked oysters. But a bigger concern for the restaurant is a 50-cent hike per pound of Mississippi catfish.
"It's not a lot, but when you sell as much catfish as we do, it can affect the bottom line," said Tom Dayton, director of operations.
The Mississippi poultry industry was among the hardest-hit by Katrina. The state accounts for 10 percent of the nation's chicken production.
"Many birds were lost," said Richard Lobb, spokesman for the National Chicken Council. "Many farms lost power in the storm. When 10 percent of your production is taken out (for) a week or two, it could cause some impact on the wholesale level."
Last week, poultry prices increased between 2 cents and 6 cents per pound, depending on the cut, said Terry Francl, senior economist for the American Farm Bureau Federation.
Salvaging supplies
At House of Coffee Beans in Rice Village, owner Mike Mulloy is waiting to learn whether the 150-pound bags of green coffee beans he has stored in New Orleans can be salvaged.
The port has 28 warehouses that store coffee, amounting to about 1.6 million bags of unroasted beans, or 27 percent of the U.S. supply, said Joseph DeRupo of the National Coffee Association. New Orleans is the second-largest U.S. coffee port, behind New York.
Procter & Gamble Co. announced Wednesday that its Folger's and Millstone brands may temporarily be unavailable. The company has four processing and storage facilities in New Orleans. Until they resume operations, the brands may appear in different packaging, said Doug McGraw, vice president Global Coffee for P&G.
Sugar has been part of the Louisiana fabric for two centuries. The industry employs about 20,000 people and produces about 16 percent of the U.S. sugar crop.
"This has been a difficult year, even without the hurricane. Prices have been low. Yields have been off," said Phillip Hayes, spokesman for the American Sugar Alliance.
"Now with this, you almost feel like (sugar producers) are being kicked when they're down. We hope they can rebound from this."
The hurricane forced the closure of the New Orleans-area Domino and Imperial Sugar refineries, which jointly produced about 5,500 tons of per day.
Dessert Gallery Bakery & Cafe owner Sara Brooks is paying $8 more per 50-pound bag of sugar than pre-Katrina. Her two Houston shops use about 7,000 pounds of sugar weekly. So far she's absorbing the cost.
"It's a lot for something that used to cost $17," she said. " ... So for now, all I can do is cross my fingers and say a prayer."
dai.huynh@chron.com
http://www.chron.com/cs/CDA/ssistory.mpl/special/05/katrina/3354676