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Daikin controlled atmosphere technology ships custard apples to Malaysia

Daikin controlled atmosphere technology ships custard apples to Malaysia

 

A shipment of Taiwanese custard apples was completed successfully earlier this year from Taiwan to Malaysia with the help of controlled atmosphere (CA) technology from Daikin Reefer, a leading supplier of refrigeration and climate control solutions for freight containers. Headquartered in Japan, Daikin Reefer is the refrigeration business division of global refrigeration, air conditioning and climate control provider Daikin Industries, Ltd.

The container-load of custard apples was shipped from Kaohsiung, Taiwan to Port Kelang in Malaysia, arriving on 7th February, after 12 days in total from harvest through loading to ship and subsequent offloading in port.

Taiwan is one of the leading sources of custard apples and growers and shippers have been frustrated over the years by the difficulty of finding new markets with their produce. The custard apple, known by a number of different names such as the atemoya fruit, is a tree of the family Annonaceae.  It has a taste similar to that of custard. Popular with the health conscious, it has low GI (Glycemic index), is naturally sweet and an excellent source of vitamins C and B6, as well as being rich in potassium.

The fruit is particularly popular in China which typically accounts for over 90% of Taiwanese exports each year. The initial impact of the COVID-19 pandemic on fruit imports due to blockages at Chinese ports under lockdown provided an opportunity for the custard apples to be shipped using Daikin Active CA. Previous reefer shipments of custard apples made without Daikin Active CA on this route saw anywhere from 30% to 80% of the fruit arriving spoiled, due to either chilling injuries or overripening which results in brown spots to the fruit’s skin. Once offloaded, such spoiled fruit typically only has a shelf life of 2 days.   

When shipped with Daikin Active CA, the custard apples arrived in optimum condition with an extended shelf life of between 5 and 7 days.

Taiwan custard apples vary in shape, size and colour and it is particularly challenging to ship them over longer distances because of the speed at which they can spoil and discolour when transported in normal reefers that rely on natural respiration.

The Daikin Active CA system reduces oxygen and manages carbon dioxide levels, as well as boosting nitrogen levels to quickly put fresh produce into a state of hibernation inside the reefer. This helps to maintain the quality of the fruit and extend both the shelf life (i.e. the selling days on shelf in stores) and the overall storage life of a wide range of fresh produce, even on the longest of journeys.

This means perishable cargoes with low respiration rates can be transported under optimum conditions – unlike when more passive systems are used.

In 2019, Daikin Reefer led a research project together with the National Taiwan University (NTU) and Taitung District Agricultural Research and Extension Station to test whether custard apples could be transported over long distances using its Active CA. The research team at NTU was funded by Taiwan’s Ministry of Science and Technology. NTU conducted extensive tests to simulate the same transit days using custard apples of varying maturity, all of which were stored using the Active CA optimal atmospheric conditions. The project successfully demonstrated the effectiveness of CA technology: custard apples stayed firm after five weeks, with samples taken at intermittent stages to assess progress.

 

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Reefer shortage remains despite slight recovery in China

Reefer shortage remains despite slight recovery in China

 

Markets in some areas of the Far East appear to be slowly returning to work, after a major slowdown in the face of the Coronavirus outbreak. Although consumption is starting to recover somewhat, this is still far from being the case across the region, according to Juri Falandt, owner of Dutch company, Milestone. Speaking to FreshPlaza, Falandt said, “It is expected to take at least two to three more weeks before production is at full strength again. However, for now, there is still a huge shortage of truckers. These are needed to transport goods to and from the inland and harbour. Shipping companies have already cancelled many trips employing void sailings. At the moment, it is still reasonably easy to book containers. But, this will become more difficult in the coming weeks. Then, production will reach normal levels. Everyone is going to try and catch up. There will be renewed pressure on rates and space in the coming weeks.”

There are currently an estimated 200,000 reefers stranded in Chinese ports and surrounding countries, according to Seatrade. This represents about 13% of the total number of worldwide reefer containers. There are reports of container ships having to dump their loads or return without unloading because there is nowhere to offload. Seatrade reports that due to the shortage, some companies are currently only able to access 25% of the reefers they require for their goods. “The first tangible structural change is still, at least, eight weeks away. Also, the large container shipping companies have very serious cashflow problems. In an attractive market, they might start charging higher tariffs for their reefers. So, not only will these shortages have long-term repercussions on the market, we can certainly expect these higher prices to continue.”

 

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Reefer business explores opportunities

Thomas Eskesen, founder of the Eskesen advisory group, sees more opportunities than threats for the global reefer shipping business, he told the audience during the 19th European Cold Chain Conference, held in Amsterdam March 6-8.

Today’s global reefer shipping business is influenced by many different macro drivers. To name but a few, global population growth, climatological changes, currency exchange rates and food safety issues can all affect the global flow of goods and therefore the global shipping business. Among all these drivers, Thomas Eskesen, founder of the Eskesen advisory group, sees more opportunities than threats, he told the audience during the 19th European Cold Chain Conference, held in Amsterdam March 6-8. However a dose of realism for the current situation is not misplaced. While over 2001-2007, growth figures in the global container shipping industry were significant – an annual growth rate of over 10% was not uncommon – a decline started leading to negative figures in 2009. Back when expectations were high, a lot of new ships were built, now leading to overcapacity. The overcapacity calls for more realistic growth expectations. Growth is slowing down and thus changing the dynamics of the sector. Eskesen warned that experts are advising that we get used to a much lower growth path than in the past.

Back to “normal growth”

“Growth percentages of around 2-3% will be the new normal,” he said. However in the short term things look less solid. “The second half of 2015 has not been okay and 2016 will be the worst in history,” Eskesen said. In order to control the situation, shipping lines need to cut costs. The forming of alliances is one way to control costs. “For the first time there is a correlation between size and profitability,” Eskesen said. As a result, “in 2015 pretty much everyone is cooperating to increase scale.” He said mergers are happening now and will be happening more often in order to increase scale and reduce costs. The future will bring larger ships and fewer carriers. The increased scale and cost reduction do have implications. There will be less carrier differentiation and shipping lines are expected to further simplify their services. It may imply a different accessibility since the alliances will likely not call at all the same ports as the individual carriers did. Also an increase in food miles and longer journeys should be expected due to slow steaming, which costs less but take longer.

Thomas Eskesen, founder of the Eskesen advisory group

Intra-Asia trade will be huge

Yet one of the bright spots is the expected average growth of trade in containerised perishables. For the period between 2014 and 2019, annual growth of 3.3% for the perishable trade is forecast. This is more or less in line with the estimated growth in GDP. Although growth certainly is expected in reefer business, the demand knows geographic differences. Europe is definitely not the place where growth will take place in terms of imports. The trade into Europe from Latin America shows a decline. Also, due to increased demand from emerging markets, producers have more choice in where to sell their produce, giving them the possibility to choose less demanding markets. In that scenario, Europe, which is known for its more exacting quality and food safety requirements, could be left behind.

In terms of imports the Middle East and South Asia show the brightest figures – a CAGR of 5.9% between 2014 and 2019. Although growth is expected to slow down for Asia Pacific, it will remain the largest import region. In terms of perishable exports, a slowdown in growth is expected for all regions while Europe is the only region to see its market share rise. Brazil and Russia – once the promising B and R of the BRIC countries – seem not to be able to live up to previous economic expectations. Eskesen signals that currency issues – such as the strong dollar against the weak euro- can change the flow of goods, but in the long run currency impact is small. Of much more impact are trade barriers, like the ones affecting Russian trade. Eskesen identifies trade barriers as one of the lasting geographical key trends that will affect the shipping business. It is also why he is positive about the transatlantic trade openings the TTIP (Transatlantic Trade and Investment Partnership) could offer . Asia, on the other hand, is doing well, with India and specifically China as the success story. It is where the population growth – and increasing middle class – will be. It is also where retail is developing rapidly and it is –although to a lesser extent – where the economy is still growing. Significant growth into China is expected. It will be predominantly trading partners south east Asia and Latin America who will be responsible for the trade growth into China. “The intra-Asia trade will be huge and overall much more will be traded into Asia,” Eskesen said.

Emerging markets, traceability and transparency

Besides offering many opportunities, emerging markets can also pose challenges and bring about uncertainties. The cold chain in those markets is not yet very sophisticated and is therefore very expensive. Also surrounding food safety and the cold chain there is no global legislation in place. It remains to be seen how this will be shaped in countries like India and China and how enforcement will be arranged. Eskesen observes that investments in the cold chain in emerging markets are much needed but also very much dependent on legislation. “It will not stand a chance if the competition can work cheaper on lesser standards,” he said.

Traceability is another factor to be taken into account. “It is big and will even be bigger. We need to know what happens inside the box.” He said transparency is needed to change the industry. With regards to the cargo, carriers do have a big responsibility and more transparency would also offer more possibilities for analysis of a given situation. Definitely an uncertainty is the weather and the much discussed climatological changes are felt by the shipping industry. They signal that indeed the weather is getting more and more extreme, making business forecasting even more complicated.

All in all, the current state of the reefer business seems to show a mixed landscape but one where uncertainties, new developments and cost cutting measures can transition the sector towards growth.

MW

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Hamburg Süd: strong commitment to cargo quality

Cargo experts examine fruit quality after opening a test container equipped with the XtendFRESH system: Michaela Steineker, Thies Claussen & José Ortiz from Eurofins.

Hamburg Süd, a traditional North-South carrier, offers services in most of the world’s key reefer trades. With over 90 years of experience in the transportation of perishable cargo, Hamburg Süd ranks among the top five reefer container carriers worldwide. “We have grown close with the subject of refrigerated cargo in virtually all areas, especially in the Southern Hemisphere where we have our specialists,” says Michaela Steineker, head of Hamburg Süd’s Global Reefer Competence Team. “Where reefer containers are concerned, we transport about 98 per cent food.” Fresh and frozen products are transported, like fruit and vegetables, meat and fish. Bananas currently offer the greatest potential for growth as they are increasingly transported in containers instead of reefer vessels. Hamburg Süd has recently introduced a new service for banana transportation to Europe from Puerto Moin in Costa Rica instead of Cartagena, Colombia. The first port of call in Europe is the Spanish Marin followed by Antwerp, a traditional banana port.

Innovations maintaining quality

Innovations are important at Hamburg Süd, but always with a keen eye on product quality. “We are a high quality reefer carrier dedicated to the cargo. We want to follow new technologies for the best products, but we do not blindly adopt any new technology. We make sure there is extensive testing so no cargo problems arise,” says Michaela Steineker, who has a post-graduate degree in Food Chemistry. One of the projects in the testing phase is ‘Enhanced Reefer Monitoring’. This is a system that monitors the reefer container in real time via mobile data communication. At the same time, the container can be accessed when needed at any time to take corrective action in the box’s operations. Another new technology in co-development with the container manufacturer Carrier is XtendFRESH, a controlled atmosphere technology that is particularly suitable for avocados and bananas. The oxygen content in the container is reduced and the amount of CO2 increased. At the same time, the system removes ethylene, the ripening gas. The XtendFRESH system is a solution integrated into the cooling unit. Until now, so-called ethylene scrubbers were installed in the container. “They would only keep for one journey and then had to be renewed. That involves costs and is laborious in handling,” says Michaela Steineker.

This article originally appeared in the July-August 2015 edition, number 138, of Eurofresh Distribution magazine. Read it here: http://www.eurofresh-distribution.com/magazine/138-2015-julaug