Oh Yes! We Have Some Bananas
The triumphant return of Chiquita Brands International to the Port of New Orleans is energizing the Port and further boosting the city’s ties with Central America.
On October 21 the first shipment of Chiquita Brands International in four decades arrived at the Port of New Orleans – the culmination of years of lobbying by the Port and Louisiana economic development officials.
For Gary LaGrange, president and CEO of the Port of New Orleans, the move was a long time coming. LaGrange worked at Gulfport’s port in the ’90s and remembers that Chiquita even then wanted to bring in larger ships. But Gulfport was refused permission to dredge its port to 42 feet because of environmental issues.
Chiquita’s return to New Orleans this year is also influenced by the company’s desire to expand; a pending merger between Chiquita and Dublin-based Fyffes plc would make Chiquita the world’s biggest banana company.
The return of Chiquita gives the local economy a major boost. In addition to bringing up to 350 full-time, good-paying jobs, the move is expected to have an impact on the port of about $485 million over the first 10 years of activity, LaGrange says. The Port’s container cargo activity will increase by 15 percent annually, and the ships coming into New Orleans with thousands of containers filled with bananas will sail back south loaded with cargo from Louisiana, including paper, rosins and food products.
In September, Chiquita reached an agreement with Mediterranean Shipping Co. to transport fruit from Central America to the U.S.
MSC usually docks at the Port’s Napoleon Avenue Container Terminal.
Negotiations to lure Chiquita back to New Orleans took place on and off for about 10 years, LaGrange says. Pre-Katrina, Chiquita all but agreed to relocate to east New Orleans at France Road. Hurricane Katrina caused the closure of the Mississippi River Gulf Outlet, so that plan was abandoned.
About seven years ago, Chiquita indicated it wanted to relocate its headquarters from Cincinnati.
“We teamed up with the state and GNO Inc., to try to get the headquarters here,” LaGrange says. “Ultimately they picked Charlotte. We were outhustled.”
Sweetening the pot Louisiana persevered, hoping to draw the company’s business away from Gulfport. This time, the proposal included some sweeteners: $11.3 million to offset the company’s costs over the next 10 years, $2.2 million for a ripening facility and another $2 million offered by the port for infrastructure improvements, to include refrigerator-container electrical connections. The $11 million is performance-based upon the amount of cargo Chiquita actually brings to New Orleans.
Stephen Moret, secretary of the Louisiana Department of Economic Development, says a turning point in the negotiations occurred when Louisiana officials met with Chiquita’s officers in Charlotte this past April.
The more than $15 million the state committed to the project is a good investment, Moret says, based on an LSU economic impact study detailing the move’s positive impact on the Port plus the increased state tax revenue. Chiquita’s return “makes us one of the premier ports for temperature-sensitive cargo,” he points out.
Container activity at the Port is expected to increase by 15 percent annually from Chiquita alone.
Photos courtesy of Chiquita Brands International.
GNO Inc. was another major player in the deal. The organization’s President, Michael Hecht, says the group’s participation was a natural given that international trade is one of its six focus sectors. Chiquita has a long history in New Orleans. The company did business here for 70 years before decamping to Gulfport, and Samuel “Sam the Banana Man” Zenmurray, who ran what was then called United Fruit Company, was a major donor to Tulane University.
Hecht says Chiquita’s return is one more in a series of companies returning to greater New Orleans as the city moves further away from Hurricane Katrina. Another example is industrial carbon company Rain CII – a Fortune 1000 company. Rain CII relocated to Houston after Katrina, but has since returned its corporate headquarters to St. Tammany Parish.
In February, International Shipholding Corp. also returned. The company was headquartered in New Orleans for many decades but moved to Mobile, Ala., after Hurricane Katrina.
“We were able to convince them to return home,” says Aimee Quirk, Mayor Landrieu’s economic advisor. The company brought 210 jobs with them.
Hecht says other companies have considered moving away but reconsidered. Smoothie King and Pelican Energy fall into that group. No other city has our combination of “low cost and high culture,” he says, noting that accounting firm KPMG rated New Orleans as the “least expensive midsize market in America,” in terms of business costs.
Chiquita’s return adds fuel to the city’s attempts to firm its relationship with Central America. The Port has opened an office in Sao Paulo, Brazil, to cover all of South America and parts of Central America.
GNO Inc., meanwhile, is in discussions with Copa Airlines of Panama to establish direct flights to New Orleans. Copa’s head, Stanley Motta, is a Tulane graduate, and Hecht hopes that Chiquita’s move will be another reason to start up that service.
“Every relationship we establish or grow with Central or South America or the Caribbean builds the case to restart direct service,” he says.
Chiquita’s return “makes us one of the premier ports for temperature-sensitive cargo,” says Stephen Moret, secretary of the Louisiana Department of Economic Development. Photo by Cheryl Gerber.
A Look at The First Lady of Fruit
Full name: Chiquita Brands International Inc. (NYSE:CQB)
Headquarters: Charlotte, N.C.
Annual revenue: More than $3 billion
Employees: More than 21,000 in 70 countries
Products: Bananas, salads, other fruits
Fun Facts: Chiquita was the first company to brand a banana.
The iconic blue stickers are all individually placed on each banana by hand.
The famous “Chiquita Banana” jingle debuted in 1944 to teach consumers how to ripen bananas, considered an exotic fruit.
“I'm Chiquita banana and I've come to say – Bananas have to ripen in a certain way – When they are fleck'd with brown and have a golden hue – Bananas taste the best and are best for you.”
Source: Chiquita Brands