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Home / Bay of Plenty Times

Fruit boom brings shipping rethink

By David Porter
NZME. regionals·
22 Mar, 2016 05:30 AM4 mins to read

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Major post-harvest firms are modernising their container handling facilities.

Major post-harvest firms are modernising their container handling facilities.

The surge in kiwifruit exports through the Port of Tauranga has been accompanied by a gradual reshaping of shipping arrangements, say industry experts.

Containerisation is increasing, especially for the Asian markets that are providing the bulk of new growth. Meanwhile, the chiller reefer fleet that has traditionally handled much of the export trade is ageing, with some key shippers re-investing in specialised vessels that can also take containers.

These trends have been closely watched by the post-harvest sector, which has been allocating capex funds to develop new onsite facilities to make it easier and more efficient to handle containers.

The key issue for Zespri, New Zealand's kiwifruit export organisation, is time to market, says shipping manager Mike Knowles, pictured, who is also chairman of the NZ Shippers Council.

"We're currently doing about 35 per cent of the total volume in containers, but that's going to go up to closer to 45-50 per cent over time," he said.

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For the 2016 season, which kicks off this month, Zespri is looking at more than 10,000 container 40 foot equivalent units (FEUs), up from 9200 in 2015. In the reefer segment, Zespri anticipates using 68 charter vessels, up from 61 last season. The reefers carry kiwifruit in pallets in a chilled hold.

Container ships and chiller reefer ships each have advantages for different markets, said Mr Knowles. Reefer ships have been favoured for traditional markets such as Europe because they can provide fast, dedicated and direct (FDD) services. By contrast, container services to Europe can involve trans-shipment at hubs such as Singapore and Rotterdam. What might be a 27-day transit for a reefer ship to Europe can take 40 days plus by container.

"For Europe it makes perfect sense to use reefer ships," said Mr Knowles. By contrast, Zespri could access a number of container shipping services direct to key Asian markets from Port of Tauranga.

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"For Asia it makes sense to use containers. Those markets are growing much faster than the traditional markets. It's fair to say that the containers are taking a bigger share of the growth markets because of the excellent service we've been getting out of the port."

China, which is soon expected to become New Zealand's biggest export market by volume, currently still had 25 per cent of its volumes handled by reefers, but the bulk was containerised. The chiller reefer sector fleet has not had a lot of reinvestment.

Port of Tauranga commercial manager Leonard Sampson said the port had invested this year in 200 additional reefer power points for handling chiller containers.

Ian Mearns, chief executive of port-based Tauranga Kiwifruit Logistics, owned by the leading post harvest operators, said he did not see reefer vessels being phased out anytime soon.

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"But the additional volume we are faced with, will see an increased use of containers," he said.

"Because the volume is increasing significantly, the post-harvest sector has to be better prepared to handle containers."

Most of the major post-harvest companies are building improved container handling facilities.

Michael Franks, chief executive of Seeka Kiwifruit Industries, said the company had been aware of an increasing volume of containers being drawn from its inventory and the change had been talked about for years.

"Companies like Seeka have moved to modernise facilities to make it easier and more efficient to load containers."

Previously forklift operators loaded containers and manually "jiffied" the pallets into position inside, but new facilities at its operations in Oakside, Te Puke, and Katikati, had container loading facilities where the truck backed into a dock and forklifts drove straight in.

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Export volumes:

* New Zealand kiwifruit export volumes are expected to reach about 150 million trays in 2020, up from 94 million trays in 2014 and 121 million trays last year.

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