Hurricane Katrina devastates Gulfport banana facilities

"I'm really concerned about some people down there. Our biggest concern right now is the people who live down there," Marta Maitles, director of communications for Dole Fresh Fruit Co. in Westlake Village, CA, told The Produce News Aug. 30.

Ms. Maitles was speaking of Gulfport, MS, where Dole maintains a large facility to receive fruit imported from Latin America. Gulfport took the devastating brunt of the force of Hurricane Katrina.

National news reports have indicated rising fatality numbers in Mississippi in the hurricanes wake.

Chiquita Brands International Inc. in Cincinnati announced Aug. 30 that its port facilities at Gulfport, MS, were severely damaged by Hurricane Katrina.

Fortunately, all 20 of our employees in Gulfport have been accounted for and we are grateful, Bob Kistinger, president and chief operating officer of Chiquita Fresh, said in a press release. However, the city of Gulfport sustained tremendous wind and water damage, and many port facilities, including ours, have been severely affected. While we are still assessing the situation, it is clear that we will need to relocate our services from Gulfport for the foreseeable future. However, we are very committed to Gulfport and are developing plans to rebuild our facilities there as soon as possible.

We are still evaluating the situation, Ms. Maitles said. The port is underwater. We know we lost structures and equipment, we just dont know the degree yet. Our plan for the immediate future is to divert the fruit to other port facilities.

She said that a northbound Dole ship was following the hurricane and was diverted to Freeport, TX. She said another Dole ship had unloaded in Gulfport just before the storm arrived. I dont believe we lost fruit inventory [from that shipload], just equipment inventory.

In the meantime, she said, We have made phone contact with some of our people [in Gulfport]. Were trying to locate them all. We are waiting for them to call out. With cell phones, the incoming calls are the most disrupted.

On Aug. 30, John Loughridge, vice president of marketing for Del Monte Fresh Produce N.A. Inc. in Coral Gables, FL, said, Del Monte Fresh Produce cannot speculate on the effect that Hurricane Katrina has had to those companies that bring in bananas into Gulf ports. We estimate that about 500,000 to 600,000 boxes are brought in weekly, and there will be some interruption, particularly with the demand for bananas increasing due to the reopening of schools. At this time, we expect the market to go up as it does this time of year, but we foresee the market going up quicker due to the disruption that the hurricane has caused.

What will this do to banana prices? I have no idea at this point, Ms. Maitles said.

Juan Alarcon, chief executive officer of Turbana Corp. in Coral Gables, FL, indicated that the banana market started improving the week of Aug. 14. The disruption of the banana industry will likely raise prices even more.

On the afternoon of Aug. 30, Mr. Alarcon observed in e-mail correspondence: The situation in Gulfport seems to be difficult  people suffered a lot. It looks that the port wont work for some time, at least this is what I heard. From the supply side for the second semester, we dont see major problems unless some natural disaster occurs, which nobody knows. Companies will try to give priority to Europe since they will need to use all their licenses available since nobody knows what type of system there will be applicable for 2006. Supply is one big bag; companies decide where to take their fruit according to commitments, prices and logistics and of course Europe is the priority.

In recent months, Turbana moved its Gulf Coast banana-receiving operations from Gulfport, MS, to Freeport, TX. In Freeport, We didnt have problems with the hurricane, business wise, said Mr. Alarcon.

Gulfport is one of five U.S. ports Chiquita uses to import bananas and other fresh produce. In 2004, Gulfport handled approximately one-quarter of Chiquitas banana imports to the United States with weekly shipments from Central America. In the near term, the company plans to utilize Freeport, TX, Port Everglades, FL, and possibly other ports to handle shipments that were previously scheduled to arrive in Gulfport.

Mr. Kistinger continued, While this will obviously affect our logistics and shipping operations, we believe our ports in Texas and South Florida are well positioned to maintain high service levels to our customers in a cost-effective manner. Our main objective will be to avoid any volume or service disruptions. We are in contact with our customers to work through any service schedule changes.

Chiquita maintains customary insurance coverage for physical property, including shipping containers, as well as for business interruption. The deductibles for Chiquita under these conditions would range from approximately $1 million to $2 million. The company is continuing to evaluate any additional financial impact that may result from damage due to the hurricane; however, it does not expect these costs to be material. Chiquita also announced that none of its ships were damaged by the hurricane.

Gulfport dabbled in banana imports in the 1920s, but it was not until worker strikes in New Orleans in 1964 that large shipments of bananas began to be diverted to Gulfport. After Hurricane Camilles powerful winds of over 200 mph destroyed much of the Mississippi coast in 1969, the port began reconstruction. By 1971, imports had exceeded pre-Camille numbers. By 1975, the port of Gulfport was the largest port of entry for bananas to the U.S. market. While the port has diversified and has plans for the addition of another berth by 2010, bananas remain one of the more important parts of Gulfport shipping.

Louisiana sweet potatoes appear to have escaped damage from Katrina

Hurricane Katrina's course on Aug. 29 devastated New Orleans, Mississippi and Alabama, but the Louisiana sweet potato crop appears unscathed by the ferocious weather event.

Sweet potato shipper Matthew Garber of Garber Farms in Iota, LA, which started shipping new-crop sweet potatoes in mid-August, said Aug. 30 that "the most rain any Louisiana sweet potato field caught was one-and-a-quarter inches. It was pretty much not a big issue [for the Louisiana sweet potato industry]. The crop is fine."

He said that the disruption of the trucking industry for Louisiana is unknown at this time.

According to Bryce Malone, who heads the Louisiana Sweet Potato Advertising & Marketing Commission in Baton Rouge, Garber Farms is the states largest sweet potato shipper. Several Aug. 30 phone calls to produce companies in the New Orleans and Mississippi area by The Produce News were met by phone lines that were unanswered or out of order.

Mr. Malone said Aug. 30 that he had not had an opportunity to talk to anyone about the sweet potato crop. Instead, he said, as a staff member of the Louisiana Department of Agriculture & Forestry, he was being assigned to work at distribution centers somewhere in the New Orleans area.

These centers will give three items to hurricane victims: ice, bottled water and meals ready to eat. Mr. Malone and other state department of agriculture employees underwent training to run such centers on Aug. 29-30. He said that he would be leaving for the duty on Aug. 31 and expected to be so-occupied for perhaps weeks.

Its going to be a skeleton staff here in Baton Rouge to run the state department of agriculture he said.

His work of the sweet potato commission would take a back seat for an indefinite period of time, he added. He said that his office was closed on Aug. 29-30. The Produce News reached him by telephone late on Aug. 30 as was preparing to leave for his indefinite public-service duty.

The telephone for the Mississippi Sweet Potato Council in Mississippi State, MS, was out of order on Aug. 30. While the Louisiana sweet potato crop dodged Hurricane Katrinas huge amounts of rainfall, growers in Mississippi were perhaps not so fortunate. The Produce News will continue reporting on this as communications return to normal.

IGA appoints new senior director of branding and business development

IGA in Chicago has announced that James J. Walz has been named senior director of branding and business development.

Mr. Walz, who begins his appointment immediately, will report directly to IGA Vice President and U.S. Chief Growth Officer Doug Fritsch.

Mr. Walz begins his tenure with IGA in what is anticipated to be an intensively strong growth period. Utilizing his many years of experience, Mr. Walz will manage and enhance development of IGA branding programs, which will address the needs of existing IGA retailers and increase the number of "IGA" branded retail locations.

Mr. Walz began his career in the food industry in 1976 with the White Hen Pantry division as a store counselor and merchandizing specialist. Over the following 25 years, he advanced steadily in the White Hen corporation, holding positions ranging from regional management to director of franchise and training, and ultimately, to senior director of store automation. Since 2002, Mr. Walz was affiliated with FranNet, a leading franchise consulting firm and referral network organization. He obtained his bachelor of science degree in business administration from Marquette University in Milwaukee, WI.

Jim Walz brings a wealth of knowledge, experience and enthusiasm to this new position at IGA, Mr. Fritsch said. His accomplishments at White Hen Pantry are well known to me in my former capacities with that same corporation. There is no doubt that his extensive knowledge of development and branding will serve all of IGA's current retailers in their desire to find new ways to grow. He will also play an instrumental role in expanding our IGA banner in both existing and in new markets. Having worked with Jim in the past years, I can enthusiastically say that I am excited to have him on board with our team as we embark on this upcoming period of strong growth.

I was impressed with the full range of roles [Mr.] Walz held in his long tenure with White Hen, and the insight that experience has given him into every aspect of the retail business, said IGA Coca-Cola Institute President Paulo Goelzer. [Mr.] Walz has extensive experience in program development, including the design of programs that assist retailers in implementing better controls, as well as improving productivity and increasing sales. He will make a sterling contribution to the mission of our institute.

With the approach of IGAs 80th anniversary, I am elated to serve the historic goals of this powerful Hometown Proud alliance, said Mr. Walz. Strengthening and expanding the 'IGA brand as a whole will energize sales for our IGA retailers while at the same time enticing more potential stores to adopt the IGA banner. I am eager to find new ways to meet the needs of IGA retailers in their demand to improve services for the customers and communities they serve.

Four Seasons to close Texas division

Four Seasons Produce Inc. in Ephrata, PA, announced Aug. 26 that it will close its Donna, TX-based division, Four Seasons Trading Co. LP, by Nov. 1.

In a statement, Ron Carkoski, president and chief executive officer of parent company Four Seasons Produce Inc., called it "strictly a business decision" based on Four Seasons Trading Co. LP's ineffective performance. He said that the move will allow the company to focus on its vibrant market in the mid-Atlantic region.

From a customer standpoint, he said, Four Seasons Trading Co. LP was not able to live up to one of the corporations core values, which emphasizes exceptional partnerships.

Four Seasons Trading Co. LP, which grew out of a 2004 acquisition of Sol Fresh Produce, has 16 employees. The company has focused on linking buyers throughout the United States with fruit and vegetable growers in Texas, Mexico and, to a lesser degree, South America.

Mr. Carkoski emphasized the overall strong health of Four Seasons Produce Inc., which employs 450 people through its headquarters and three operating units in Ephrata, PA.

As difficult as it was to make this decision, particularly for the way it affects loyal employees and valued customers, it was important to act before this part of our business negatively affected our overall company, he said.

The Donna, TX, employees will receive severance packages based on the amount of time they are being asked to stay on, he said. A few employees will have an opportunity to relocate to Pennsylvania. Meanwhile, some parts of the Texas operations will transfer to Pennsylvania, Mr. Carkoski said.

Four Seasons associates in Pennsylvania and Texas worked really hard to make this a success for all parties concerned, but we just couldnt seem to turn the corner, Mr. Carkoski said.

In the next four weeks, Four Seasons Trading Co. LP will complete any remaining buying and selling to which it is contractually obligated, Mr. Carkoski said. The company will vacate its 50,000-square-foot building by Nov. 1, when it will revert to its landlord. Earlier this year, Four Seasons Trading Co. LP closed a sales office in Nogales, AZ.

Owner David Hollinger started Four Seasons Produce Co., which provides fresh fruits and vegetables to wholesale, retail and foodservice customers, in 1976 in Denver, PA. Last year, the company consolidated its operations into a new 246,000-square-foot facility in nearby Ephrata. Across the street are two other business units: Four Seasons Trading Co., which imports and brokers fresh produce, and Four Seasons Logistics Co., which provides transportation and third-party storage services to the produce industry.

Produce industry to speak in one voice in farm bill debate

WASHINGTON  Pressing trade issues and budget cuts will influence the 2007 farm bill, but that is not enough to dissuade fruit and vegetable businesses that are looking for a bigger slice of the pie this time around.

The U.S. Department of Agriculture has been holding listening sessions around the United States to hear what commodity groups want in the next farm bill. At the same time, the fruit and vegetable industry has formed work groups to develop policy recommendations on everything from increasing produce in nutrition programs to bolstering research, conservation and block grants. More than a dozen groups representing various segments of the produce industry are crafting a comprehensive wish list  perhaps housed in a separate title in the farm bill  to circulate on Capitol Hill in the fall.

"We're gearing up to set priorities and see how we might get attention for our share," said Kathy Means of the Produce Marketing Association. The industry is not looking for traditional subsidies, she said. Rather, the industry is exploring creative ways through marketing programs to increase consumption and help businesses stay competitive.

The fruit and vegetable industry is poised to take on the big guns as it successfully convinced Congress to approve the Specialty Crop Competitiveness Act. The program is valuable in itself, said Ms. Means, but it also sets the produce industry up as a player in the agriculture policy debate.

For the Produce for Better Health Foundation, the farm bill represents an opportunity to band together and push for increased funding for marketing and communication, as well as the fruit and vegetable school snack program. Once the policy recommendations are approved by the industrys steering committee, then industry can speak with one voice as leaders walk the halls of Congress later this year.

One idea is to develop a domestic marketing program that would mirror USDAs Market Access Program, said Elizabeth Pivonka, president and CEO of PBH. MAP helps trade organizations promote U.S. agricultural products overseas by tapping funds from USDAs Commodity Credit Corp. to partially reimburse participants for foreign market promotion activities.

The time may be right to challenge the farm bills favorite son, namely subsidized crops. The latest decision by nutrition experts to increase daily consumption of fruits and vegetables to stave off chronic diseases and prevent obesity has gained the attention of important congressional leaders.

This is our chance for fruits and vegetables like never before, said Ms. Pivonka. With the final farm bill slated for 2007, the industry will need to hit it hard in 2006, she said.

But various trade wars will take a toll in the upcoming farm bill debate. The divisive battle over the Central America Free Trade Agreement will take time to heal, and the Bush administrations move to comply with a World Trade Organization decision in favor of Brazils cotton industry may have repercussions for U.S. fruit and vegetable growers.

It will be a difficult road, said Robert Guenther of the United Fresh Fruit & Vegetable Association. But it is time for Congress and the administration when considering agriculture policy to think of the fruit and vegetable industry.

Just this month, an article in the Los Angeles Times followed the money in terms of government subsidies for crops and found a disconnect between federal handouts for farmers and the governments own dietary advice for Americans. Subsidies encourage an abundant supply of corn, wheat, rice and soybeans, while the government is telling Americans to eat more fruits and vegetables. Producers of specialty crops are not eligible for these subsidies.

If the government believes in increasing consumption for produce, the industry says the money should follow.