Inroads being made
into north/south trade
IN THE reefer (refrigerated) shipping business, containerised cargoes now pose a serious threat to the traditional bulk reefer operators, according to the management of Cool Carriers (CC) - a joint-venture between Safmarine and the Swedish Leif Hoegh group.
According to information released to FTW by Trevor Law, SA g.m. of CC, the line's management has noted that an uninterrupted expansion of the reefer container business has been taking place for several years.
There is now a situation of severe competition between specialised reefer operations (like CC), and major round-the-world container operators, according to CC Management.
And, they added, the most significant developments in the last year or so have been the inroads into the north/south trade being made by integral containers - whereas these previously have only offered competitive services on the west/east trades.
Containers have now made significant penetration of the trade from New Zealand and some South American countries, added CC.
With the fragmentation of the deregulated SA fruit export market - and the diverse number of smaller customers appearing on the scene - SA is also considering containers as an option, according to Law.
This from the regulated environment, when the two fruit marketing bodies, Unifruco and Outspan (now both trading as Capespan), handled the mega-volumes of SA fruit exports between them - and tended to the bulk reefer mode of sea transport.
This container challenge to bulk reefers has also been noted by Fearnley Consultants' Oslo-based analyst, Sverre Bjorn Svenning.
He has identified consolidation and competition from reefer container tonnage as the two factors which will shape the future of the reefer trades.
He also notes the swing in this trend to the previously bulk-exclusive north/south trades. Reefer container operators over the past year have begun making inroads, said Svenning.
Adjusting to customer demands is eventually the only way one can succeed, and customers these days want to ship in containers.
But CC is looking to strengthen its position in the highly competitive trading environment in SA, according to Law.
This was confirmed by the company's Stockholm-based information manager, Svante Hellberg.
We are eager to increase our presence in the SA market place, he said, as we believe this burgeoning supplier holds great potential for the future.
Following deregulation, SA is one of the world's most interesting markets for fruit and vegetables at the moment. However, despite the intense competition and pressure on rates, we are prepared to be in this market for the long-term.
And the way to go about this, according to Law, is to tailor-make services to the customers' needs.
Detailed knowledge of our customers' products, and their requirements, helps us to design transport systems that match their production methods, he said.
Consequently, the company has helped to increase market share for a number of customers around the world. In many cases, we have provided access to new export opportunities in other markets.
The future lies in creating long-term business relations and trade systems.
