THE arrival of large containerships in the Caribbean waters is likely to be the final nail in the coffin for bulk reefer vessels, once the widened Panama Canal opens.
Speakers at the TOC Americas conference in Cartagena, Colombia, said the battle for Latin America's perishables is set for a new phase, reports London's Loadstar.
With Hamburg Sud already deploying vessels of up to 9,200 TEU, with 2,100 reefer slots - the equivalent of eight traditional reefer vessels, pressure is on conventional reefer ships trading between Europe and east coast South America.
A new regional box ship workhorse of more than 9,000 TEU is to be introduced on all the main trades, said Hamburg Sud vice president Poul Hestbaek.
"Those vessels are going to be everywhere when a widened Panama Canal opens," he said.
Conventional reefer tonnage carried 28 per cent of the 100 million tonnes of perishables shipped in the 2013, but is set to fall to 20 per cent by 2018, with a three per cent year-on-year drop in market share, said Mr Hestbaek.
Said Maersk regional chief Robbert Jan van Trooijen: "Half the traditional reefer fleet is now over 20 years old. Up to a third of the entire fleet will be scrapped in the next five years."
After pushing through significant rate increases in 2013, box carriers have seen reefer rates slide back to lower levels in 2014.
Beyond lower rates, more technology was one way the container industry was strengthening its popularity, with perishable shippers looking for new markets.
In addition to the economies of scale and the lower slot costs that come with bigger container vessels, the use of more sophisticated temperature-tracking devices and access to real-time information for shippers on conditions in the cool supply chain are set to be big factors in the fight for this lucrative trade, Mr van Trooijen said.
Visibility was an aspect of the industry that has become universally accepted as "necessary," according to Mr Hestbaek - yet questions remain about who will pay remain unanswered.
Shipping lines find shippers less interested in service improvements than in lower prices, especially faced with carriers desperate to fill ships.
"What's better? Service or price? It's all important to us," said Allison Nowlin, who is in charge of international logistics at JBS USA, the North American arm of the world's largest frozen meat shipper.
"When their executives present us with the triangle of quality, speed and cost, and ask us to choose just two, our response is always the same. We want all three."
WORLD SHIPPING
11 November 2014 - 23:05
Small reefer ships may fade out when wider Panama Canal opens
THE arrival of large containerships in the Caribbean waters is likely to be the final nail in the coffin for bulk reefer vessels, once the widened Panama Canal opens.
WORLD SHIPPING
11 November 2014 - 23:05
Small reefer ships may fade out when wider Panama Canal opens
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