Food Importers Worry About Greek Crisis

Banking system seize-up, economic meltdown could snarl supplies of beloved olive oil, honey, wine

Over the last five years, Katerina Iliades has built up a big, loyal customer base at her Greek International Food Market on Washington Street in Boston’s West Roxbury neighborhood.

“Greek olive oil is really pure -- you know exactly where it's coming from. You can really taste the difference,’’ Iliades said in an interview Monday afternoon. Along with dozens of varieties of small bottles, she offers a 17 liter – 4 ½ gallon – container of olive oil from Crete for $150. She’s found plenty of non-Greeks love those products and her Greek honey, wine, feta cheese, and other groceries. “They enjoy trying our cuisine and learning about the culture,’’ Iliades said.

But with Greece’s economy and banking system now melting down amid the Greek-European Union fiscal crisis and Sunday’s referendum vote, many importers of Greek delicacies are starting to worry that the supply chain for Greek food exports could quickly seize up too.

Every year Jeremy Johnson's Encore Specialty Foods in Hingham, Mass., brings millions of dollars’ worth of Greek delicacies into the U.S. That includes unusual products for Americans to find like Greek steamed beats and florina peppers, and as you would expect “a full line of Greek olives, kalamatas, pitted kalamatas, some nice olive mixes’’ ranging from 50-calorie snack packs to 5-pound restaurant sacks, said Johnson, national sales manager for the family-owned business.

Encore's latest container load of products just left Greece Sunday, according to their shipping company. But now Johnson worries if his producers can still keep producing. “We've been informed by some of them that they now have to pay cash for their materials for the first time in twenty or thirty years,’’ Johnson said, something he’s not certain all can do to get fertilizer, pesticides, and other materials in a country that has been clamping down on bank withdrawals.

If that means Encore has to start prepaying its Greek producers, as prudent business people, they'd have to seriously consider steering clear of Greece until this crisis ends. “If we pay that in advance, what guarantees do we have that the order will ship and will deliver to us?’’ Johnson said. “If it doesn't deliver, for whatever issue, then we're out of the product and out of the cash.’’ And with a typical shipment taking eight weeks to cycle from the day it’s placed through shipping to becoming available at Encore’s shipping hub in Elizabeth, N.J., the company can’t afford to take risks they pay for shipments that never come. “Ideally, from a business standpoint and from a cash flow standpoint, we don’t want to be paying in advance,’’ Johnson said,.

At the same time, Johnson said, many of his suppliers have told him not to pay him for orders in the works – because they don’t know what happens to money that goes into their banks, and they have more faith in being able to get money later from Encore than they do from Greek banks.

“One of our suppliers told us, they said, ‘Even if you have an invoice currently due or due in the next week or two, don’t send it to my bank, because we don’t know when we're going to get that, where it's actually going. So until this whole thing has blown over, don’t send us any money.’ They don’t know where these funds are going and where they’re going to end up.’’

For Katerina Iliades, it’s been a time of literally losing sleep worrying over the fate of suppliers and business partners, but also family and friends still living in an ancestral homeland she adores. “It’s definitely a difficult time, but we hope all the best for Greece,’’ Iliades said, “and we sincerely just wish the best and hope that things get solved.’’ 

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