Flooding stifles shipping on the Mississippi River
People look on as water from the rising Mississippi River is released through the Bonnet Carre Spillway May 9, 2011 in Norco, La.
CHIOTAKIS: Some shipping traffic is slowly getting by on the swollen Mississippi River. After being cut off yesterday for a time. That's hindering all kinds of commerce in the Southeast, which of course, will ripple across the U.S. economy.
Flood waters have risen in areas between Vicksburg, Mississippi and the Mississippi Delta. Thousands of residents have been told to seek higher ground.
Lizzie O'Leary is a reporter with Bloomberg and she joins us now from New Orleans with the latest. Hi Lizzie.
LIZZIE O'LEARY: Hi Steve.
CHIOTAKIS: What kind of an economic blow are we talking about there? How bad is it expected to get?
O'LEARY: Well, the final numbers are a bit of a mystery. The governor here, Bobby Jindal, said that hundreds of millions of dollars in Louisiana. And then you've got shipping closures on parts of the Mississippi, which affects coal, grain. You have flooded grain elevators, and then you've got to add to that the national flood insurance program where we can probably see billions of dollars in claims. And the crop insurance program which will likely see similar numbers.
CHIOTAKIS: And you've got oysters right? And refineries that are in the area too. How bad a hit are those going to take?
O'LEARY: The refiners so far have escaped the big blow. In part because those two spillways have been opened. They spare the cities but they also spare about 13 percent of refining capacity. Exxon's big on in Baton Rouge had their docks closed, but they've still got pipelines. Oysters will take a hit because fresh water coming down will disrupt their kind of brackish habitat. And they've obviously had a pretty nasty year from the Gulf oil spill.
CHIOTAKIS: And what about the rest of the country? How is this going to affect the economy -- the entire American economy?
O'LEARY: You know, I had a really interesting conversation with a guy who runs shipping for AEP, which is the biggest Mississippi River shipping company. And he called themselves kind of a economic bellwether. He said they could feel the recession coming two to three months before it actually hit because steel companies weren't ordering as much. So the shut downs here probably are going to ripple out over the next couple of months. And we may not feel them immediately, but this affects far more than just the states that actually have water flooding into their fields.
CHIOTAKIS: Lizzie O'Leary with Bloomberg joining us from New Orleans. Lizzie thanks.
O'LEARY: You're welcome.