Hurricane Ida’s damage to the ag sector

We are learning more about the damage Hurricane Ida left behind on grain facilities throughout Louisiana.

One of Cargill’s grain export elevators and one of their terminals were damaged. CHS reports its grain facility could be without power for weeks. Bunge and Archer Daniels Midland says that they are working on assessing the damage to their export locations.

The hurricane has disrupted grain and soybean shipments from the Gulf, which accounts for around 60 percent of U.S. exports.

The U.S. Coast Guard closed a portion of the lower Mississippi River, halting vessels carrying commodity exports.

Meat processors are taking inventory of the damage done to their facilities. Many will resume operations today and Sanderson Farms says that all of their locations have power except one in Hammond, Louisiana and a feed mill and hatchery in Mississippi.

Those buildings do have generators and missed any structural damage. Sanderson expects power to be restored by the end of the week.

It is still too soon to tell how severe the overall damage from Hurricane Ida will be, as the storm makes its way through the Tennessee Delta and northeast this week. Entire towns in Louisiana are flooded and power transmission lines are down, putting more than a million people in the dark.

We are keeping an eye on ag impacts, including the sugarcane crop. According to USDA’s Brad Rippey, “It does appear that there will be some damage to the sugarcane crop as the center of Ida passed right through a portion of southern Louisiana’s sugarcane crop. Louisiana accounts for almost half of U.S. sugarcane. Also, in some of the coastal, marshy areas there is going to be some saltwater intrusion that can cause long-term damage to sugarcane fields where we get salt water into field.”

He says fortunately the center of the storm passed just to the east of many of the major production areas along the delta.

The hurricane is also impacting fuel supply and distribution. GasBuddy says that fuel prices could surge over the next few weeks. They are predicting as much as a 5 to 15 cent per gallon increase.

Most oil refineries in the Gulf are either shut down or operating at a reduced rate currently. Normally, these facilities account for 12 percent of U.S. refining capacity.