Article written by Neutral Air Partner – TIACA Trustee
Written by: Muriel Zographos, Head PR and Communications
The increase in global population and economic growth are major factors driving the perishable goods transportation market. This rapid growth is fueling an exponential demand for fresh daily-need products, classified as perishable goods. Transit times are still too long to guarantee the quality and shelf life that retailers demand and cost is very important, but there is a new generation of consumers who want fresh, seasonal produce and they are prepared to pay more.
Airfreight could win, as shippers of highly valuable and temperature sensitive produce look towards using aircraft either on a full or part-charter basis. A difficult project as freighter capacity is getting tighter as the demand from the e-commerce sector continues to climb. This, as well as the fact that moving perishables by air compared to sea freight is a costly issue.
Perishable cargo can be defined as goods that will deteriorate over a given period of time or if exposed to adverse temperature, humidity or other environmental conditions. Perishable temperature control products are those likely to spoil, decay or become unsafe to consume if not kept refrigerated at 40 F° (4.4 °C) or below or frozen at 0 F° (-17.8 °C) or below. Perishable goods include meat, poultry, fish, dairy products, fruits and vegetables, all cooked and frozen foods and beverages. Another big market of perishable goods is flowers.
Perishable goods being susceptible to deterioration, damage and waste during transport need specific preservation conditions, highly sophisticated cool supply chain solutions and expertise to arrive to the final consumer. Food wastage is a major issue. Approximately 1.3 billion metric tonnes of food is being wasted along the supply chain every year, equating to one third of all food produced. Transporting perishables involves different requirements in terms of demand, load, transport and delivery integrity, specific cooling, ventilating, refrigerating equipment, all raising transportation costs and risks much higher than standard cargo. The air cargo community should collaborate to create its own supply chain standards for perishables in order to tackle a disconnected and fragmented chain, where one third of all food produced is wasted and achieve a common goal of reducing waste by at least 10% by the year 2025. This would represent 250,000 tons of savings, or about $1bn in value and 1m fewer tons of emissions, including CO2 and other greenhouse gasses.
Sustainable initiatives by companies and the adoption of green logistics in transportation is now an undeniable fact. An increase in environmental awareness has raised concerns over pollution caused by transportation, recycling and secondary sources of pollution caused by packaging and warehousing. Smaller carbon footprint and fewer pollutants are now serious issues considered by consumers, shippers and companies, that are moving faster toward the Sustainability concept. Environmental awareness leads to promoting green logistics concepts, which are mainly related to fleet management, green storage and packaging, logistics environment management, alternative fuels, green transportation, and innovation in logistics.
Based on geography, the perishable goods transportation market can be segmented into North America, Europe, Asia Pacific, and Rest of the World (ROW). Asia Pacific accounts for a major share of the global perishable goods transportation market, due to large population, vast territory, higher consumer demand, but also due to the expansion of agriculture and service sectors, leading to an increased production and supply of goods, especially in China and India.
Perishable goods industry sectors include Chilled and Fresh warehousing, Freezer and cooling plants, Food packing, Ripening, Dry Ice, Brokerage, Local health and customs requirements, Re-labelling, International and domestic transport, Procurement and Trading, Valued added products as in Keep Cool and Waste to Energy, Full and part charters, Blocked space agreement with carriers, Priority airfreight, Emergency final mile solutions. Each sector of the chain, from harvest to sale, shares responsibility and if one link breaks, all suffer the consequences of the unsatisfied customer. Nevertheless, it is an exciting industry with growing demand for perishable good logistics expertise.
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