Coverage: Hurricane Florence and its economic impact
Hurricane Florence continues to head toward the mid-Atlantic coast and is expected to make land sometime on Friday, potentially bringing record damage to the economies of the Carolinas and causing other problems for businesses.
Ivan Levingston and Kathering Chiglinsky of Bloomberg News reported that insurers have begun sending staff to the region:
Hartford Financial Services GroupInc. and FM Global are among insurers with exposure in the region that are sending staff to help with anticipated claims.
“You’d have to expect, just based on the forecast, that it’s going to be a significant impact to businesses,” including prolonged disruptions, said Rick Miller, head of the U.S. property practice at Aon Plc. “Certainly businesses that take a direct hit, their facilities could be impacted for months.”
Making matters worse for insurers, forecasters say that Florence may stall over land, potentially dumping rain for days and causing power failures. The storm, expected to make landfall late Thursday or early Friday, may trigger “catastrophic flash flooding,” the National Weather Service said. Companies from agricultural firm Cargill Inc. to carmaker Daimler AG suspended operations in Florence’s path.
Florence could become the most powerful storm to hit the area in more than 60 years if its intensity continues. One estimate pegged the potential total costs of the storm at $30 billion.
Jeff Daniels of CNBC.com reported that farmers could be hit hard:
Poultry houses were preparing for the hurricane by stocking up on gas to run generators as well as bringing in extra feed to ride out the storm.
Nearly 10 million hogs are raised in North Carolina, and the state ranks second in production. Producers were taking steps to prepare for the storm, given that flooding could cause the overflow of hog manure lagoons.
“If it does the damage that it could do, talking from 20 to 30 inches of rain, and if the storm hovers … you could see the loss of livestock and poultry in the millions,” said Dan Kowalski, vice president of the Knowledge Exchange division at Denver-based CoBank, a major lender to agribusiness. “You have a lot of high-dollar crops that are still out there.”
Glenn Fleishman of Fortune reported that hog manure lagoons are susceptible to being washed away:
Industrial-scale pig farms shift hog output into giant pools for management. These lagoons contain the manure and gradually compost them into fertilizer, but they’re effectively open-air waste pits, only somewhat secured against flooding. Overflowing or breached lagoons can render drinking-water supplies dangerous, cause phosphorus blooms, poison animals and agricultural land, and spread farm-related pollutants and toxins, like pesticides, fuel residue, and chemical additives. These spills kill wildlife and livestock.
Also, it smells terrible.
It’s this putrid horror that North Carolina is faced with, as Hurricane Florence barrels its way to the U.S. coast. The state has about 2,300 industrial pig farms and 9 million hogs. Those pigs and other animals produce 10 billion gallons of untreated sewage annually, according to the Environmental Working Group. North Carolina’s 100-year-flood plains still house 62 industrial hog farms and 30 chicken-raising operations, with a combined 532 manure ponds within the floodplain or within 100 feet of it, the Environmental Working Group said in a statement today.