- The Washington Times - Monday, September 12, 2005

U.S. farm production is expected to reach near-record levels this year, despite damage to Mississippi cotton and Louisiana sugarcane crops from Hurricane Katrina, the Agriculture Department said yesterday in its first post-storm crop report.

But the Aug. 29 hurricane is affecting farmers, near and far from the Mississippi Delta, by clogging a major transportation lane and contributing to rising fuel prices.

For farmers, the combination of high output and backed-up transportation would mean that prices for major commodities fall just as production costs rise.

“The economic impact of the Hurricane Katrina will be felt throughout the Midwest,” said Ed Kordick, commodity services manager at the Iowa Farm Bureau.

Corn prices yesterday hit a three-month low and soybeans touched a six-month low after release of the USDA report, which projected strong harvests. Corn futures for December delivery fell 4.5 cents, or 2.1 percent, to $2.115 a bushel while soybeans for November declined 5 cents, or 0.9 percent, to $5.85 a bushel at the Chicago Board of Trade.

Hurricane Katrina also hurt the farm economy when it hobbled grain elevators while slowing ship traffic at the base of the Mississippi River.

The Port of New Orleans facility is tied by waterways, roads and rail lines to farms throughout the South and Midwest — and is a vital link to move grains and meat out of the U.S. market to overseas destinations. It is the top port for some commodities, such as exported soybeans, corn and rice. Without exports, the commodities can accumulate in the U.S., increasing supply and lowering prices.

Already, corn shipments are backing up as farmers try to move the grain from farms to elevators that are full and cannot be unloaded.

“The price of corn has been impacted drastically by the shutdown on the river,” said Jon Doggett, vice president for public policy at the National Corn Growers Association. “But slowly they are getting back up and running. We are hoping it will be weeks, not months.”

The Port of New Orleans yesterday was scheduled to reopen to commercial shipments, and the Mississippi River largely was cleared of debris. Also, most of the 10 grain elevators around New Orleans were functioning on at least a limited basis. But operations still faced manpower shortages and limits on river navigation.

Hurricane damage to Mississippi and Louisiana farm production near the coast was extensive, but the USDA said yesterday that it would not have a major effect on nationwide production for most crops.

USDA said 10,000 acres of Mississippi cotton would be lost because of the storm, and Louisiana sugarcane production would drop by 1 million tons.

“Our poultry industry probably was the hardest hit,” said John Anderson, associate extension professor at Mississippi State University. Mississippi produces about 10 percent of the country’s poultry. Mr. Anderson estimated that 400 poultry houses were destroyed and 20,000 birds killed by the storm.

Richard Lobb, spokesman for the National Chicken Council, said the state’s 14 chicken slaughter plants were returning to business quickly.

“I suspect this will be pretty much invisible to consumers,” Mr. Lobb said of lost poultry production.

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