This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS SAN JOSE 002100 
 
SIPDIS 
 
WHA/CEN 
EB FOR WCRAFT, BMANOGUE 
E FOR DEDWARDS 
WHA FOR WMIELE 
WHA/EPSC FOR KURS, LGUMBINER 
H FOR JHAGAN 
STATE FOR HURRICANE KATRINA TASK FORCE 
STATE PASS TO USTR FOR RVARGO, NMOORJANI, AMALITO 
 
E.O. 12958: N/A 
TAGS: ETRD ECPS ECON PREL PGOV SOCI CS
SUBJECT: EFFECTS OF HURRICANE KATRINA ON COSTA RICAN 
BUSINESSES 
 
 
¶1.  Summary.  While Costa Rica lies far south of the 
devastating path that Hurricane Katrina took, some Costa 
Rican businesses are being impacted by its effects on the 
operations of the port of New Orleans.  Many Costa Rican 
companies rely on the port as the primary doorway for 
importing and exporting goods.  These businesses are now 
faced with the need to use other, more costly alternatives 
and face uncertainty with respect to availability and 
price.  The result will be higher costs of doing business 
and at least a temporary reduction in the global 
competitiveness of affected businesses.  End Summary. 
 
¶2.  Last year, Costa Rican businesses exported over USD 16 
million worth of products, such as tires, glass fibers, 
meat, coffee, fish, and spices through the port of New 
Orleans.  One of the most affected businesses is 
Bridgestone Firestone which used to send three containers 
of tires per week to New Orleans and now has a shipment 
stranded in the Gulf of Mexico.  "[The effects of Katrina] 
represent a problem because we export tires every week to 
New Orleans.  Even more, the products we send to Canada 
also enter through this port," stated Isabel Jinestra, 
export assistant for Bridgestone Firestone.  She also 
stated that the company will probably start shipping 
products to Charleston, South Carolina, at a shipping cost 
of fifty percent more per container. 
 
---------------------------------- 
COSTA RICAN EXPORTS TO NEW ORLEANS 
---------------------------------- 
 
¶3.  Katrina has had other economic effects.  The price of 
coffee has risen in part because of the destruction of the 
many coffee-roasting companies with large operations in New 
Orleans.  In 2004, Costa Rica exported USD 8.9 million 
worth of coffee through New Orleans.  These exporters are 
now using the ports of Houston and Jacksonville to meet 
their customers needs.  The same is happening to various 
spice-exporting companies that in the first six months of 
2005 sent 730 tons of products to New Orleans. 
 
¶3.  The aqua-culture industry with products such as farm- 
grown fish has also been affected.  An example is the 
company Propica which exported half of its products through 
New Orleans, and has decided to start using Houston's port. 
On the positive side, according to representatives of 
Maersk Sealand, a shipping company, the cost of sending 
goods to Houston is about the same as sending them to New 
Orleans. 
 
¶4.  Exporters are not the only companies feeling the 
destruction brought on by Katrina.  Companies that import 
basic production materials have suffered uncertainty in 
supplies and prices.  Many plastic-producing operations, 
such as Modern Plastics, Inc., import oil from New 
Orleans's many refineries because of their proximity to 
Costa Rica.  Many of these refineries were affected by 
Katrina and Costa Rican companies that use their products 
are forced to wait or find other sources for their 
operations.  "The situation is uncertain.  We do not know 
when supplies will be delivered, how long we have to wait, 
and the prices change every day," lamented Jack Liberman, 
general manager of Modern Plastics. 
 
¶5.  Grain and oilseed importers are also watching the Gulf 
situation closely, as 100 percent of Costa Rican 
consumption of yellow corn for animal feed and soybeans is 
imported from the United States through the port of New 
Orleans, and most rice and wheat imports pass through there 
as well.  Costa Rican imports of these grains and oilseeds 
totaled 1.1 million metric tons in 2004.  The major 
commodity importers report that for the short term they are 
in pretty good shape, since it appears that two vessels 
carrying U.S. corn and soybeans will arrive by mid-month. 
(Corn and soybeans, which are crushed in country for 
soybean meal for the poultry industry, are especially 
critical.)  For wheat, available supplies should last for a 
few weeks.  Rice stocks in country are good, and import 
demand is low. 
FRISBIE