LONDON, 08.10.2015 – Increasing demand for smaller food consignments seems strangely at odds with the deployment of ever-larger container vessels across the globe. But who is benefitting from the widening logistics gap between container / truck loads and individually wrapped pizza packs delivered straight to your doorstep?
This should please European perishable produce exporters such as Wiskerke Onions, San Lucar Fruit, Marine Harvest and all those companies seeking out the shortest and most effective routes to conquer emerging markets. The necessity for exporters to develop new markets was brought home by flat-lining demand for primary perishables in Europe and the impact of Russia’s continuing food import ban.
Dwell times in ports are becoming a big issue, delegates were told. The situation may not be as drastic at Jeddah, where San Lucar had to wait 19 days before its container could be released. Pointing the finger at the UK government, Nigel Jenney, CEO of Fresh Produce Consortium, mentioned a 5 day dwell time in some UK ports, largely due to inefficient food inspection regimes. Clearly one of the worst cases affecting RORO and Channel Tunnel operations this year has been the situation in Calais. According to Jenney, this year the UK fresh produce industry has been faced with losses of between 15 – 20 million GBP, as a result of the European refugee crisis.
According to Alexis Michel of CMA CGM, reefer containership capacity is set to increase by nearly 20% between mid-2015 and 2018, with reefer box transshipment becoming the new normal. One of the side-effects of container ship capacity expansion is that rate volatility is threatening to engulf reefer rates further for the time being. Michel also sees new alliances on the horizon on the South-North Trades.
As Alexander Kapitonov, Commercial Director of Moscow-based Procontainer, pointed out, new reefer supply chains are in the process of being developed between Russia, Uzbekistan, Kazakhstan and the Caucasus. The Russian Government has put forward a programme for import substitution. This is to make up for the massive drop in poultry, seafood and red meat imports, and a long term programme for developing the country’s agricultural sector. This will be accompanied by various new logistics projects, including the development of a new free port in Vladivostok, expansion of the New Silk Road between Beijing and Moscow and a ‘slow development of reefer infrastructure, including cold stores.’