Refined sugar giant Imperial Sugar has announced a return to operations at its Gramercy, Louisiana plant following the devastation wrought by Hurricane Katrina.
The company, which distributes to food manufacturers, retail grocers and foodservice distributors through the 'Imperial', 'Dixie Crystals' and 'Holly' brands, has commenced limited shipping on a priority basis, though this remains limited due to problems with the availability of transportation equipment and fuel.
Imperial's executive vice president Paul Durlacher said that he was thankful that "fortunately most of our associates fared relatively well and therefore we have been able to staff key positions on all shifts".
The refinery, located only 20 miles northwest of New Orleans on the Mississippi river, shut down on 27 August as forecasts for the region became more severe. The company now plans on carrying out a full damage assessment of the refinery, and will be hoping that the region's infrastructure, already under tremendous pressure along with energy supplies, can be restored as soon as possible in order for normal service to resume.
Other food businesses have slowly begun to resume operations. Poultry giant Sanderson has resumed operations at all three of its Mississippi feedmills, and plans to resume operations at its Laurel processing plant today.
The overall picture of course remains bleak. Companies in the region that escaped the full wrath of Hurricane Katrina will still find their operations hampered due to damaged infrastructure.
It is becoming clear that it is this aspect of the devastation that could have the longest-lasting impact. About $150 billion worth of cargo is shipped every year through the region's seaports, accounting for about one-fifth of all US imports and exports.
Just over 60 percent of corn and soybean exports originate from the New Orleans area. With barges loaded with farm goods stranded on the Mississippi River and no access for ocean-going vessels, grain elevators have reduced the prices they are paying growers.
US grain and oilseed producers may see the cash prices bid for exported crops decline another 5- to 10-cents per bushel while the Gulf ports are effectively shutdown for repair and restoration.
Nonetheless, a return to some semblance of normal operations will be hugely welcomed by businesses such as Imperial Sugar. The sugar giant announced disappointing financial results last month with a net loss of $4.5 million for the current quarter.
This financial performance, which contrasts with a reported net income of $4.3 million during the third quarter of 2004, has been attributed to lower sales prices against higher energy, freight and manufacturing costs. And with the United States already facing a tight sugar supply - and subsequently increasing the allotments for imported sugar - the price of sugar from sugar cane is likely to be significantly impacted by Katrina.