6 Big Economic Threats Hurricane Ian Poses Now That It’s Landed
Tropical cyclones as powerful as Hurricane Ian threaten to cause lasting damage to families, crops, coastlines and industries long after they roar ashore.
The initial onslaught of wind and water as well as persistent flooding pose significant risks to the lives of those who did not evacuate. And Category 4 threats like Ian can smash power grids, level homes and render many roads impassable, isolating people when they need help the most. The economic ripples radiate far beyond the path of the storm.
In Ian’s case, many of those effects will be magnified because he hit the heartland of Florida, America’s third most populous state. The storm blew winds of 150 miles (241 kilometers) per hour when it touched down after 3 p.m. local time Wednesday near Cayo Costa — tied for the fifth most powerful hurricane to hit the continental United States. As the United States and the state begin to shift to storm response and then recovery, here are some of the threats to watch out for.
Hurricanes push water past them as they move over the ocean. That’s what we call “storm surgewhich can cause significant coastal destruction. The low-lying geography and shallow continental shelf in parts of West Florida make it particularly vulnerable. The storm surge projected by Ian from 12 feet (4 meters) to 18 feet could send sea water far inland.
The wave and winds that Ian will bring ashore will deal a devastating blow to towns and villages along the coast. But heavy rains battering Florida and into Georgia, South Carolina and beyond will spread misery — and damage. Example: Walt Disney World in the Orlando area of Central Florida issued a shelter-in-place order for hotel guests despite being about 140 miles from where the storm made landfall.
More than 2 feet of rain can fall over central Florida. The National Weather Service warns there could be record flooding on rivers across the state. Over the next seven days, torrential rains could fall from Florida to southern New Jersey and into Appalachia, according to the US Weather Prediction Center.
The Sunshine State could go dark for days
Category 4 storms cause such damage to power grids — such as snapping poles — that the National Hurricane Center said outages can last for weeks or even months. Florida Power & Light, the state’s largest electric utility, told customers to prepare for “widespread outages” from Ian and warned that they could linger for days. Utility NextEra Energy Inc. spent billions to strengthen its system after a wave of hurricanes hit the state more than a decade ago, but now faces the prospect of having to rebuild some of them parts. More than 30,000 utility workers from 26 states were mobilized to help restore power after the storm passed, according to the Edison Electric Institute, a trade group. But it will require access to equipment and communities that can be cut off by flooding or downed trees.
Out of gas
Many fuel terminals in Florida are closed, while high winds and flooding make truck deliveries impossible in many areas. State fuel distributors are warning of long wait times to resupply businesses and homes with diesel for generators. A prolonged disruption to water transport could jeopardize the state’s fuel supply, 90% of which comes from barges at 4 ports.
President Joe Biden warned the oil companies against rising gas prices in Ian’s wake: “Don’t – let me repeat, don’t, don’t – use this as an excuse to raise gas prices in America.”
Breakfast gets even more expensive
Orange juice futures prices soared as Ian approached the Florida coast. And if crop damage to the famed Florida crop is as extensive as feared – potentially 90% of its citrus belt, according to Maxar – it will further aggravate the food inflation plaguing consumers.
For producers, the damage could force life-changing decisions. Florida growers are already dealing with a devastating disease called citrus greening that damages fruit and eventually kills trees. A destructive blow from Ian could be the last straw for some growers, said Raymond Royce, executive director of the Highlands County Citrus Growers Association in Sebring, Florida.
Then there is the impact on fertilizers. Fertilizer maker Mosaic Co. evacuated some of its operations in Florida as Hurricane Ian neared landfall – another food inflation threat.
Risk of chemical spills and dead fish
Florida produces much of the United States’ phosphate fertilizer, in a process that yields a radioactive, toxic byproduct called phosphogypsum, which is stored in piles – or large mounds. Last year, one suffered a catastrophic outage due to heavy rains, triggering a red tide that killed an estimated 1,800 pounds (816 kilograms) of marine life and forced evacuations in nearby towns. Environmental specialists fear a possible repetition with Ian, whose path may approach where Mosaic has most of its phosphate facilities. A company spokesperson said it had made improvements to its facilities to help prevent such problems, including “a more comprehensive internal dike system”.
Good luck getting insurance
The insurance market in Florida was already chaotic before Ian. But the storm comes in the wake of six insolvencies among insurers writing home insurance policies in the state. The biggest insurers had pulled out of the market after previous natural disasters, while smaller businesses still operating there have struggled to sustain losses.
Flood damage is generally not covered by home insurance policies. Instead, they fall under policies managed by the US Federal Emergency Management Agency.
“If it’s a major flood, it could leave many homeowners vulnerable,” said Mark Friedlander, spokesman for the Insurance Information Institute. “If there were major losses caused by windstorms, other businesses could also be pushed into potential insolvency.”
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