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Katrina Hampers Rail Movement of Retail Goods

September 7, 2005
Hurricane Katrina’s devastation at the Port of New Orleans isn’t expected to have a major impact on the maritime shipment of retail goods, but could cause slowdowns in railroad operations that will make it take longer to move retail goods out of other ports, industry sources say.

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“Railroads are going to need to divert around the New Orleans area for a significant period,” National Retail Federation Vice President and International Trade Counsel Erik Autor said. “That could result in a shortage of railroad cars and longer transit time for trains hauling merchandise away from other ports, particularly on the West Coast."

Autor said it’s too soon to get a full measurement of the impact, but the NRF's Port Tracker report has raised the congestion rating for two major port areas.

Autor said New Orleans is a major port for bulk commodities but not retail container shipments, minimizing the direct effect on the retail industry. Diversion of New Orleans-bound ships to other ports isn’t expected to be a problem for retailers because those ships will be sent to other bulk commodity terminals with the proper equipment to unload them, not the container terminals used by retailers, he said.

Hurricane Katrina’s damage is expected to have “a major affect on transportation infrastructure in the coastal region and north into the lower Mississippi River watershed,” Global Insight Global Transportation Group Principal Economist Paul Bingham said. “Traffic along the Gulf Coast will be subject to extensive detours, and port operations along the coast will be disrupted for an even lengthier time.”

Stress on the railroad network is reflected in the September issue of Port Tracker, which raises the congestion rating for the ports of Los Angeles/Long Beach and Oakland to medium from the August rating of low. The poorer rating is based on availability of rail transportation rather than congestion within the two ports themselves.

The other six ports covered by Port Tracker -- Tacoma, Seattle, New York/New Jersey, Hampton Roads, Charleston and Savannah -- were ranked “low’ for congestion and none were at high. Tacoma and Seattle had been rated medium in August because they were seeing increased traffic because of a port trucker strike in Vancouver, but the strike has been resolved.

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