Hurricane Harvey has claimed dozens of lives, destroyed over 100,000 homes, and displaced hundreds of thousands of people. While the storm is dying down its effects will be felt even in the trucking industry for a long time to come.
Since Harvey first made landfall last Friday, it retreated and made landfall again two more times. The last time was on Wednesday as a tropical storm. It is now making its way over Mississippi, Tennessee, and Kentucky as a ‘tropical depression.’ It will bring heavy – but not life-threatening rain – until it dissipates.
But just because it’s not raining in Houston anymore, doesn’t mean the danger has passed. On Thursday, more rivers burst, flooding entirely new areas and prompting a new round of mandatory evacuation orders.
The most recent flooding in Beaumont caused the failure of city water plants, shutting off running water and causing the evacuation of the local medical centers. Elsewhere flooding has caused explosions at chemical plants.
In order areas where the water is receding, bodies are being found. So far the death tolls stands at 39 people, but according to the Houston police, that number is expected to rise as more bodies are discovered.
For trucking, storms of this magnitude bring large changes. The FMCSA has relaxed hours-of-service regulations in Texas and Louisiana in order to get emergency supplies to affected areas faster.
According to research from FTR Transportation Intelligence, after Hurricane Katrina in 2005, spot freight prices jumped, followed by contract freight prices. That’s expected to happen now as well as not only does freight get backed up, but the amount of new freight headed to affected areas is expected to increase both in the short and long term. With trucks diverted to serving those markets, the cost of freight in other markets will also increase.
Ports in Houston, Texas City, Galveston, and Freeport were closed, but have all at least partially reopened on Thursday, so freight will start to come through there again. Local airports are also expected to gradually resume service, but rail freight will likely be disrupted for a while longer.
Fuel prices will also likely be affected. Texas provides about 30% of the oil refinery capacity for the entire United States. Eight refineries in Texas have been shut down which usually produce as many as 2.7 million barrels of oil every day. With less refining capacity, oil prices at the pump will likely go up while crude oil prices will tumble. And at least two ExxonMobil refineries have been flooded and are possibly spilling chemical pollutants into the water, possibly extending the amount of time needed to get the refineries back up and running.
Source: gobytrucknews, truckinginfo, truckinginfo, truckinginfo, fleetowner, overdrive, dallasnews, abcnews, dailymail, cnn
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Sean says
I hate to say it. Harvey will likely be a blessing for truckers who weren’t caught in its path. Between immediate relief and long term rebuilding, truckers can and will capitalize on this natural disaster. Unfortunately, the fuel pumps will beat us to the profit. 😤🔫