Ship ahoy for fresh produce
Stricter pest control rules and improved technology mean exporters are increasingly exploring the option of sending goods over long distances by sea instead of air freight
Shipping lines, which have been expanding their market gradually at the expense of air-freight operators, are pushing the battle lines farther into the latter's traditional stronghold of high-end fresh produce amid tighter pest control regulations and improved technology.
Firms that used to forward fresh produce from Australia and New Zealand to China and other parts of Asia by air were now exploring the option of switching to ships, cargo handlers said.
Stricter pest control rules imposed by countries such as China and the United States mean more perishable goods must be kept in a chilled condition for between 12 and 14 days before arriving at their destinations, undermining the time advantage of air delivery.
"Even if the cargoes went by air, they would still have to undergo the cold sterilisation at some point before entering the country," said Glenn Turner, chief executive of logistics firm Fresh Trust. "But if they go by sea, the cold treatment can be performed during the trip, saving time and money for the shippers."
Shipping costs for items such as fruits and vegetables were 16 to 18 US cents per kilogram on average, Turner said, compared with an air-freight rate of US$1 per kg. "Exporters in Australia and the US may consider moving more of their airborne fresh cargoes to ships in the future as they face immense price competition from exporters in Latin America," he said.
Countries such as Chile and Argentina, which have increasingly shifted their focus to Asia from traditional markets in the US and Europe, ship tonnes of cherries and raspberries to China at a lower price than their peers in Australia and the US. Australian and US cherries mostly travel by air to China because frequent flights and relatively low fares between the continents get the fruits to market fresher and at a reasonable price.
But APL, the world's seventh-largest container shipping firm, said it had been receiving more inquiries from Australian shippers about the possibility of sending their cherries by ship to China instead of flying them there.