Saturday, May 17, 2014

New Orleans regains position as top banana

The Port of New Orleans is set to regain its position as one of the main entryways for the billions of bananas imported to the United States each year, a windfall officials hope will create a few hundred new jobs and boost shipping container traffic in New Orleans by as much as 15 percent.
Speaking at the port Wednesday, Gov. Bobby Jindal, Mayor Mitch Landrieu and others announced that Chiquita Brands International, successor to the storied United Fruit Co., will bring its shipping operations back to New Orleans this year from Gulfport, Mississippi, where the company has operated since the 1970s.
The move won’t come without costs for taxpayers. Jindal said the state will be providing as much as $15.5 million over the next decade to offset the company’s costs, make infrastructure improvements and build banana-ripening facilities.
Even so, the news gave officials a chance to brag about the growth of the regional economy and New Orleans’ comeback, not just from the flooding that followed Hurricane Katrina but also from decades of economic stagnation that preceded it.
“Something dramatic is happening in the city of New Orleans and the state of Louisiana,” Landrieu said. “Before, people were leaving; now they’re coming back. Before, New Orleans and Louisiana had to ask people to return; now they’re trying to find a way to get back here.”
The return of Chiquita, one of the world’s largest shippers of bananas and other types of fruit, marks at least an important symbolic win for the city.
New Orleans spent a good part of the 20th century as the country’s top banana importer, the place where Samuel “the Banana Man” Zemurray, a Russian immigrant, ran the company that dominated the global banana trade — as well as the political affairs of Latin America’s so-called “banana republics.” Zemurray sold his successful import operation to New Jersey rival United Fruit in 1930, only to oust United’s management a few years later and go on to run the company for more than two decades.
For years, the banana import operation on the riverfront was an essential aspect of the city’s image and iconography. Tourists were as likely to buy a postcard depicting banana boats unloading as one showing a streetcar or a French Quarter balcony.
From the foot of Canal Street upriver to about where the cruise ship terminal operates today, “all those docks were used for the United Fruit Co.,” said Clarke “Doc” Hawley, longtime captain of the Natchez steamboat and an amateur historian of the river.
He cited a tourism guide from 1925 — about a decade after the first refrigerated containers made banana imports from Latin America feasible for the first time — noting that five conveyor belts along the river could handle 5,000 bunches of bananas per hour, amounting to about 20 million bunches per year.
It was big business and also, for some, entertainment.
“We’d go down to whatever wharf we could get into and watch them,” Hawley said. “The spiders would pop out, and sometimes they’d be as big as oranges or small grapefruit. Everybody would jump and run. That was a big thrill.”
Those big spiders, of course, came from Latin America, where United Fruit’s political exploits have inspired whole histories.
“A company more powerful than many nation states, it was a law unto itself and accustomed to regarding the republics as its private fiefdom,” wrote Peter Chapman in his 2007 book, “Bananas: How the United Fruit Company Shaped the World.”
The company, now based in Charlotte, N.C., changed its name to Chiquita Brands International in the 1980s, choosing the brand name under which United had long sold bananas with its famous “Chiquita banana” cartoon and jingle.
By then the company had shifted its import and export business to Gulfport after more than 70 years of operating on the New Orleans riverfront.
Luring the company back took some doing.
Port of New Orleans CEO Gary LaGrange described talks going back to 2004, interrupted by Katrina, then picking back up recently with trips by port officials to Chiquita terminals in Central America.
Jindal cited three types of incentives that eventually helped persuade the company to relocate. He said Louisiana will give Chiquita $11.3 million to help offset the company’s costs over the next 10 years. That grant will be performance-based, tied to the number of units the company actually ends up shipping through the port, with clawback provisions in case of shortfalls.
Another $2.2 million grant will go to the port to build ripening facilities, which will then be leased to Chiquita. Finally, another $2 million will go to other infrastructure improvements.
In return, Louisiana is expecting Chiquita to create jobs and pump dollars into the local economy. Jindal cited an LSU study that forecasts the move will add from 240 to 350 new jobs, including those of people not directly employed by Chiquita.
The study also estimates an overall economic value of between $373 million and $485 million over the next decade.
Chiquita Senior Vice President Mario Pacheco said the company has committed to maintaining an annual payroll in Louisiana of at least $480,000.
He said the first container ship from Central America should arrive in New Orleans sometime in the last quarter of 2014, with one coming each week after that. Total volume of both imports and exports is expected to hit the equivalent of 60,000 to 78,000 20-foot containers each year, he said.
Pacheco did not mention another prospective big move on the company’s horizon, a roughly $1 billion merger in the works with the Irish company Fyffes, one of Chiquita’s biggest rivals. If it goes through, the deal would make Chiquita the world’s biggest banana company, a title now held by Dole Food Co. Officials gave no indication Wednesday that the merger might have any impact on the move to New Orleans.
Pacheco also couldn’t promise that the company’s decision will lift New Orleans back to being the country’s No. 1 banana importer, noting competition from ports in the Northeast, but he said, “It’s definitely in the top five — or will be.”
Jindal suggested one way for locals to boost business.
“We should all eat as many bananas as we can,” he said. “We should have that as a staple of our diet.”

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