Hurricane Mitch wrecks Central American agriculture
HURRICANE Mitch has ripped through the agricultural base of Central America, reports the Financial Times.
Nicaragua, El Salvador and Guatemala from suffered destroyed coffee plantations, shrimp farms and fruit trees.
Honduran authorities tentatively assessed the value of lost agricultural production at $200 million in 1998, rising to more than $500m (£300m) in 1999.
Bananas were one of the main products damaged.
“Its clear that a lot of capacity has been lost. US spot prices have doubled in the last week to $9.50 a box,” said Terry Bivens, an analyst at Bear Stearns in New York.
Central America is the USAs biggest source of bananas and plantain imports, accounting for $642m-worth last year, according to the US Department of Agriculture.
Juan Manuel Moya, government relations manager of Standard Fruit, one of the two big producers in Honduras, said he expected “a 100% loss”.
Chiquita Brands, the US fruit group, said it would make a fourth-quarter write-off of about $50m on the 7000 hectares (17,296 acres) it owns in Honduras.
Dole Foods said it would take a $50m to $70m charge because of Hurricane Mitch. It said: “We expect a 12-month interruption in supply from Honduras, Guatemala and Nicaragua.”
Europe relies less heavily than the USA on bananas from Central America because of European Union rules.
- Hurricane Mitch will have lasting effect, FWi, yesterday (05 November, 1998)
- Hurricane Mitch boosts coffee markets, FWi, 04 November, 1998
- Financial Times 06/11/98 page 34