While many supermarkets and restaurants are reopening, devastation caused by Hurricane Harvey and resulting flood waters will be felt for years in Houston.
 
“Whatever you see or hear about the storm here, multiply it times 100 — that’s how bad it is here,” Craig Butler, president of North Side Banana Co. Inc., Houston, said Aug. 31. “The city is under water and it is still flooding.”
 
Harris County officials said 30,000-40,000 homes were destroyed by flooding caused by Harvey, which struck Texas Aug. 25. Killing at least 31, the storm dumped 50 inches of rain east of Houston, the most ever recorded in the continental U.S. from one storm. (see story on memories of Hurricane Andrew)
 
Supply impact
 
As bad as the storm was, the fresh produce supply chain has been resilient.
Butler said Aug. 31 there have been small disruptions in the banana supply, with shipments diverted from Galveston to Florida during the storm. Galveston had reopened by Aug. 31 but the Port of Houston remained closed, he said.
 
Demand was strong from supermarkets, he said.
 
“Schools are shut down but the grocery stores are packed and bananas are a perfect item to grab in a crisis like this,” he said.
 
Many restaurants are closed, putting more demand on grocery stores.
 
Retailers are opening their stores, he said, but the problem for consumers is getting to the stores. 
 
“There are a lot of stores that are isolated and the stores that are open and people can get to are packed,” he said.
 
Flooding and high water could be a problem in the weeks ahead, he said, as two big reservoirs west of Houston are forced to release water to the Buffalo Bayou, which spreads from west Houston to downtown. 
 
“They are releasing water in an area that already has 50 inches of rain in it, so you are adding insult to injury but there is nothing they can do about it,” Butler said. Some parts of the city could be underwater for a couple of months, he said.
 
With coolers being filled up again, both restaurants and retailers are resuming operations, said Wesley Hudson, national sales manager at Tomato Management Corp. and vice president of the Houston Fresh Fruit & Vegetable Association. The freeways are open, though some areas are still hamstrung by flooding.
 
“We are bouncing back pretty strong.”
 
About 50% of restaurant customers were re-opened as of Aug. 30, with 75% or so expected by Sept. 1, said Brian Preiss, general manager of Hardie’s Fruit & Vegetable Co. Houston LP, Houston.
 
“If they can get there, we can get there,” said Preiss, whose company has donated several truckloads of produce to feed residents.
 
On Aug. 29, trucks from the company’s Dallas division covered customers on the north side of Houston, since those locations weren’t accessible from city center because of flooding. Inbound trucks on Aug. 25 were diverted to the company’s facilities in Dallas, Austin and San Antonio, and those loads were heading to Houston on Aug. 30, he said.
 
With some employees losing cars and/or homes to flooding, about 90 were available to work Aug. 30, about half the normal workforce, Preiss said.
 
The company has given several loads of produce to the George R. Brown Convention Center, where 9,000 are sheltered.
 
Some restaurants may be closed or will be forced to rebuild in the wake of the flooding, he said. Economic losses could hurt the restaurant trade.
 
Schools were slated to start back up after Labor Day, but that could change.
 
Retail coming back
 
Retailers were opening stores and seeing big business. H-E-B informed consumers about openings on its Facebook page and Wal-Mart had a dedicated page on its website about store status and hurricane relief.
 
On Aug. 30, Ragan Dickens, director of national media relations for Wal-Mart, said that 17 Wal-mart stores, three Sam’s Club stores and two distribution centers were still closed as a result of the storm. At the height of the storm, 134 Walmart facilities were closed, he said.
 
Wal-Mart is pulling from distribution centers from New Mexico to North Carolina to make sure the Houston stores are served, he said.
 
 
Transportation impact
 
Harvey’s flood waters could drive up freight rates across the U.S. by creating demand for equipment to deliver relief supplies, said Mark Montague, industry pricing analyst with Portland, Ore.-based DAT Solutions. “Trucks from Atlanta that would normally go to Florida for $2.50 per mile could take a Federal Emergency Management Agency load to Houston for $5 per mile. Houston is the sixth biggest market for refrigerated freight in the U.S..
 
Shipments of Latin American produce to Houston could be diverted to Miami and perhaps Port Everglades, he said. 
 
Storm damage to oil refineries created an up-tick in gasoline and diesel prices, which also will pull freight costs higher, he said.
 
Reuters reported that about 4.4 million barrels of U.S. refining capacity were shut down by Harvey, or about 24% of U.S. refining capacity. It was not clear when the refineries would resume operations.
 
 
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