Keeping the world buffet cool

Countries around the world are lining up, plates in hand, for the air cargo buffet.

Air shipments of perishable food are strong, especially in Asia, whose growing middle class hungers for imported seafood, produce and more. WorldACD reported that in April, world air cargo volumes of non-pharma perishables grew over 12 percent year over year.

In order to satiate demand around the globe, companies must maintain a proper cool chain.

Fish out of water

Air Iceland has laid the groundwork to move Greenlandic seafood, and in a few months, operations finally begin, thanks to a change in European Union food regulations.

“There’s a lot of demand all over the world for fresh seafood,” Ingi Thor Gudmundsson, Air Iceland’s director of sales and marketing, says.

Air Iceland has routes from Reykjavik Airport in Iceland to four cities in Greenland, including Nuuk, the capital and largest city in the country, with about one-third of Greenland’s 57,000-strong population.

Gudmundsson says Air Iceland moves a lot of fresh produce into Greenland, but the airline needs cargo to fill the planes’ bellies on the return trip to Iceland. The answer is seafood, Greenland’s main export.

Air Iceland will focus on markets in the UK, U.S. and Canada, transporting haddock and halibut in the beginning. Gudmundsson says the airline plans to eventually increase frequency to some destinations in Greenland.

“The demand is there,” he says. “It’s just a question of frequency because we know the demand has become to have seafood on each plane, the demand is so high.”

In order to maintain the cool chain for the seafood, Air Iceland made an agreement with Greenland’s airports, stipulating that the airports will have cold facilities on the property. Reykjavik Airport also has cold infrastructure.

Salmosped, a forwarder in Oslo specializing in seafood, sees growth of its own. Every month, the company moves 40,000 tonnes as part of Norway’s thriving seafood business, Lasse Wangen, Salmosped’s marketing manager, says.

The forwarder flies salmon – among the country’s biggest exports – trout, white fish, scallops, mussels and live king crabs.

“The cool chain is thoroughly maintained throughout the whole packing process,” Wangen says.

Salmosped is flying more salmon to the U.S. this year compared to last year, and it also moves seafood to the Middle East. But the biggest market is Asia, including Japan, Hong Kong and Southeast Asia.

In order to reach global destinations, most of Salmosped’s seafood is delivered to Oslo Airport, with some trucking to other European airports.

“Oslo is picking up in pace and becoming a more important airport in Europe,” Wangen says.

Ten years ago, most seafood had to be trucked to airports outside of Norway, but now the majority flies from Oslo, he says.

Live lobster requires special precision in order to maintain the cool chain, Geoff Irvine, executive director of the Lobster Council of Canada, says.

If the lobsters are to be shipped immediately, they go by truck to a processor for grading. Then the lobsters are packed in plastic foam boxes with ice packs and sent to an airport, usually Halifax Stanfield International Airport, which features the new Worldwide Perishables temperature-controlled facility.

“Since it’s a live product, temperatures are important,” Irvine says. “We’ve done a lot of training on handling and proper husbandry and proper temperature control because a lobster, you can’t get back vigor. It’s just taken away by handling and temperature changes.”

May and June are the busiest times for fishing lobster in Canada. After July, lobsters go through their molt cycle, losing their shell, so there’s no fishing.

“That’s why we need to store product to keep our markets going,” Irvine says.

Long-term storage ranges from sophisticated pounds that help mimic lobsters’ hibernation state in the ocean, to a more typical concrete reservoir containing refrigerated water.

Canada exports lobster to 50 countries, Irvine says. The biggest markets are the U.S., China, Japan, South Korea and Hong Kong; Europe follows behind. In 2013, the EU and Canada reached an agreement on the elements of a trade agreement, so Irvine hopes for a free trade agreement to be finalized with the EU in the future. He expects this to increase European lobster sales.

Irvine says the big growth area is Asia, especially China. Canada signed a free trade agreement with South Korea in March, the country’s first with an Asian country.

“The impact on air cargo would be the requirement for more air cargo as we develop those Asian markets because generally, they like live lobster rather than processed lobster, and that needs to go by air,” Irvine says.

Canada’s lobster industry also wants to target India.

“We’ve had some initial discussions with what’s happening in India, and the real challenge there is the cold chain. They just don’t have a very advanced yet system of cold storage and handling,” he says. “Big time opportunity though, considering how many people are there and the growing wealth.”

Produce

Driscoll’s export berry business is burgeoning. The California-based berry company sells raspberries, blueberries, blackberries and strawberries – its biggest seller.

“A lot of that is driven by the associated health benefits of each of the berries,” Tom Shepherd, supply chain at Driscoll’s, says.

The company airfreights berries to Asia, Europe and the Middle East, with Driscoll’s export product representing about 5 percent of its business, Shepherd says. Berries are grown in the U.S., Mexico, Morocco, Spain, Chile and Northern Central Europe, among other places.

Shepherd says maintaining the berries’ temperature consistency is important.

“Once that cool chain is broken, there’s a cumulative effect that begins to take place,” he says. “One of the real challenges for us is just eliminating those process gaps, those breaks in cold chain,” such as when berries sit at the airport after they’re offloaded from a plane.

There are more handoffs with airfreight compared to trucking, meaning more chances for the berries to be in and out of refrigeration – and more entities involved.

“Getting all those companies aligned and making sure there is kind of again an aligned purpose and an aligned focus is probably about the most challenging part of the whole air cargo cold chain challenge,” Shepherd says.

The shift of seasons leads to a lot of transport between countries. During the summer, Driscoll’s doesn’t transport many berries to Europe because of the large local supply. During other parts of the year, the berries come from the U.S. Once the U.S. season winds down, the Mexican berry season starts, and Driscoll’s starts exporting from there.

“Our air program will help supplement that seasonally when the berries aren’t available out of those locations,” Shepherd says. “We really want to do everything that we can and stay focused as we can, that the berries the consumer takes off of the shelf at the store level, that temperature consistency has been maintained from the time that the berries are picked.”

Greenland has a different challenge for produce. Because there are no roads between towns, cargo in Greenland must move by air or sea, Air Iceland’s Gudmundsson says. At times, sea isn’t an option when cities close down due to ice.

“Sometimes when the ships can’t come in, the demand for fresh vegetables, fruit and produce, they increase,” he says. “That’s why we are moving a lot of volumes into some cities in the winter time.”

Chris Connell, president of Commodity Forwarders, Inc., says the Los Angeles freight forwarder of perishables, transports produce such as cherries, peaches, nectarines, grapes and berries – and a good portion goes by air to Asia, Australia, the Middle East and Latin America.

“Demand for a higher-quality piece of fruit is, luckily, there,” Connell says. “Cool chain is still a big key because you can put all this investment into growing to harvesting to packing to trucking to an airport or seaport, and a big part of this now is: How do we get it to its final destination as close to the quality that it was before it left?”

He says evolving regulations can prove a barrier for transporting produce across countries. For example, two years ago, Chilean blueberries didn’t require fumigation before arriving in the U.S; now they do.

“All these complications adding other steps to the process aren’t just financial barriers,” Connell says. “They’re also process barriers that have to be worked through, and whether it’s price or less quality of a piece of fruit or veg on the shelf, either way there will be an effect to the market.”

Shepherd says another aspect of managing the cool chain is choosing an air carrier. In general, cargo carriers tend to be better positioned to manage temperature, he says.

“There’s certainly a wide variety of performance levels from a cold chain standpoint between air carriers,” Shepherd says.

Liquids

Even soft drinks need the cool chain.

DHL Global Forwarding works with some of the world’s leading soft drink manufacturers, says Frank Cascante, DHL Global Forwarding Americas’ regional sector head for business development for consumer and perishables verticals.

Soft drink companies have two types of liquids that use the airfreight cool chain: concentrates for the elaboration of soft drinks, and special ingredients for the formulas used to flavor the drinks.

“In any good cold chain, it’s not only how well you keep the temperature, but it’s also how well you maintain the chain of custody, which is the transfer points,” Cancante says “Are you checking the temperatures? At every port when it enters, make sure you’re transferring that data, make sure the shipment is flowing smoothly.”

He says some flavor ingredients use insulation wrapping and gel packs to keep the product within 10-15.5 degrees Celsius (50-60 degrees Fahrenheit). Other concentrates need to be kept even colder at -4 degrees Celsius (24.8 degrees Fahrenheit), so DHL uses insulated, temperature-controlled shipping devices that work with fans and dry ice.

Liquids used in the soft drink process ship from manufacturing sites in the U.S., Latin America and Northern Europe to large manufacturing bases in Argentina, Brazil and Mexico, Cascante says.

These air shipments run at a high price. For instance, Cascante says a 5-liter (1.3-gallon) drum of concentrate can cost US$25,000 (18,348 euros) to ship.

“It also requires a great deal of customer care because you’re dealing with a very expensive concentrate, be it flavoring or otherwise, that you have to make sure that it gets there within 1-2 days to an inbound manufacturing site,” Cascante says. “In many cases, it could be a manufacturing site that needs to release a new type of product, so it’s so critical for that to be there.”