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Perishables bear fruit: Why air cargo shouldn’t fear modal shift

Randy Woods by Randy Woods
May 2, 2016
in Specialty Cargo
Reading Time: 9 mins read
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fruitThe flat peach – also called a Saturn peach or a doughnut peach for its toroid shape – is high in potassium, vitamin A and vitamin C, and has become a popular health snack in many parts of the world. In 2015, flat peach production spiked, reaching more than 200 percent of the average volume for 2009-2013. The compact, flat shape of the fruit also happens to be ideal for shippers who want to pack it in bulk.

At Spanish fruit trading cooperative, Fruits de Ponent, located about 150 kilometers west of Barcelona, the easyto-eat, fuzz-free flat peach has been one of the emerging stars in its repertoire of stone fruit, including several varieties of peaches, nectarines, apricots, plums and cherries. “It’s an always sweet peach,” said Robert Perucho Coma, head of sales for Fruits de Ponent, which produces 10,000 tonnes of the juicy orbs every year.

A few years ago, interest in flat peaches began to grow in Dubai and Saudi Arabia. At first, Fruits de Ponent tried to meet this demand by trucking the flat peaches to Barcelona, then sending them via the Mediterranean. “We tried with seafreight, but finally we realized that it was better for all – the shippers, the retailer and the final customer – to send the flat peaches by air cargo. Flat nectarines and whiteflesh varieties of peach and nectarine are other commodities that we ship via airfreight.” Most of these air shipments are now made via Emirates, using various 3PL companies in Barcelona.

The reason for switching to air? “The quality was better,” Coma said. The sea voyage to the Middle East tended to be too hard on the soft flesh of the peaches. “All products with more than 15 days of transit time are suffering quality problems,” he said.

Today, the 65,000-tonne-per-year cooperative is increasing its use of airfreight to Asia, Coma said, mainly in the ASEAN region and Hong Kong. “It happens due to demographic and economic potential of the area, and especially because our products need a short transit time,” he said. “Other fruit companies use airfreight to reach far markets. This is the only way to do it.”

But wait – isn’t this a rising commodity that has switched from seafreight to airfreight? Isn’t modal shift toward the ocean, using “hibernation technology” inside sea containers, supposed to be the scourge of the perishable air cargo industry? “Modal shift is a very sexy topic,” said Natasha Solano, global business development manager of perishables logistics for Kuehne + Nagel. “But the press has taken the modal shift idea and blown it all out of proportion.” Shifts between air, ocean, road and rail modes is not something new and has happened many times over the years, “but it affects only certain commodities on certain lanes,” she said. Some commodities, she said, will always move by air, such as certain kinds of fresh fish, flowers and berries at varying times of year.

Recent increases in demand for edible commodities appear to show that the expected death of perishable (non-pharma) airfreight at the hands of ocean-based modal shift has been greatly exaggerated. Cheap, reliable seafreight will always hold a vastly larger market share on global cargo volumes. As Solano pointed out, 70 percent of fruit sent by K+N is via ocean, 23 percent is by road and just 3 percent is via air. Yet a deeper analysis suggests that the numbers are on the side of airfreight taking a larger bite out of ocean traffic, based on demographic, economic and marketing trends.

“By 2050, there will be 9 billion people on earth and demand for fresh food will be 60 percent more than it is today,” Solano said. “This is good news for both ocean and airfreight.”

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Tags: AirLogistix USACommodity Forwarders Inc.European Shipper's CouncilFeaturesfoodfruitFruits de PonentKuehne + Nagel (K+N)LufthansaTradevegetablesWCS 2016WorldACD
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