Global reefer container shortage threatens perishable industry

SA perishable shippers are concerned about a global shortage of reefers set to worsen just as aggressively cultivated new markets emerging from the recession will be in a position to purchase more SA product. “More avocados are moving in containers. We had a good year this year and expect a good year next year, so growers are following all developments that may interfere with delivery to markets,” said Derek Donkin, CEO of the Subtropical Growers’ Association. “Many shipping container and leasing companies stopped sourcing and producing containers altogether during the 2008-09 slump,” reports Investment U Research, which noted that a trade boom between Asian nations had monopolised available boxes at a time when labour stoppages had affected what production was left in the principal container manufacturing countries of China and Taiwan. “Research company Tufton Oceanic believes the industry needs up to 6 million shipping containers to restore it to the conventional 2.2 containers per available slot. To put that into perspective, that’s equivalent to two years’ worth of production,” noted Investment U Research. The container shortage was highlighted when logistics were discussed at the inaugural Global Citrus Conference in Cape Town last month. In his presentation, Mitchell Brooke, logistics coordinator for the Citrus Growers’ Association, noted that the volume of global perishable products expected to be shipped per annum over the next five years was deemed higher than 100m tonnes according to the research firm Sextant, and the ability to move this amount via specialised shipping containers is problematic. “In my research I’ve found that during the last three years prior to the recession 200 000 to 300 000 reefer containers were manufactured per year. In 2009 it was around 20 000, with an optimistic outlook of 100 000 for 2010,” Brooke told FTW. Diminished shipping during the recession has led to box manufacturers shutting down, he said. “Five to eight percent of existing containers are taken out of service per year because of malfunction, age or damage. To keep up with (expected) demand, there will possibly be a need to manufacture at least 300 000 to 400 000 units per year over the next five years to compensate the reduced production,” said Brooke. He noted that the 1.6m reefer containers currently in circulation worldwide were half of what would be required (3.2m reefers) in five years’ time.