None of the wind or rain from Hurricane Katrina ever touched Iowa, but the financial effects are certainly being felt here. Corn and soybean-filled barges are starting to line the shores of the Mississippi and Missouri rivers with nowhere to go, as the storm-ravaged port of New Orleans is closed. Futures analyst Dan Keutchenmeister says the costs will quickly become staggering. Grain is going to back up and Keutchenmeister says he’s not sure the infrastructure exists to send the bounty of Midwest harvests to the coasts by rail. One estimate says the farm sector may suffer losses of $1 BILLION due to Katrina. Iowa motorists are also being punished by high prices, with a gallon of gas jumping 50-cents a gallon this week. Midwest marketing analyst Akshay Rao says there’s speculation it’ll reach $4 a gallon soon enough. Rao says $4-a-gallon gas “is a reasonably frightening prospect when you think about the implications of that, not just on motorists and on airline travelers and so forth, but on the economy as a whole.” Rao says the U.S. economy relies to a great degree on the transportation of goods, so any increase in trucking costs will eventually be passed on to consumers.
