Are you having issues with moving freight out of Spain this winter? Are carriers suddenly dropping capacity that they promised you? Will prices ever stop increasing?
These are some of the major questions we are being asked on a daily basis by our clients. Although many think the fresh fruit & vegetable sector is the only area affected, that is not the case. These questions are coming from not only fruit & vegetable suppliers but also those outside the vertical of agriculture, mainly due to the fact that refrigerated units are often used for ambient freight throughout the year and taken from the capacity pool once citrus/salads start in November and berries begin in January.
The Spanish freight market can be volatile, so volatile that the entire European carrier community seems to want to have a piece of the action from winter to spring (especially December, January, and April) when export prices to UK, Central Europe, and Russia can fluctuate dramatically from the summer season. However, many customers are being proactive this season due to proper forecasting of the truck market.
Instead of getting into a pricing war over the limited road capacity, many suppliers are utilizing multi-modal solutions to save costs and decrease exposure to shortages. One of the main alternatives is using ferries/short sea container ships to transport from Spain to Holland and then reloading the product onto the large pool of equipment in Benelux to deliver to Central Europe and beyond. The short sea carriers are now offering weekly departures and direct services from the Spanish North Ports (Bilbao, Vigo and Gijon) to the main European North Ports (Antwerp, Rotterdam, Hamburg). There are also SSS services for temp-controlled from Mediterranean ports (Barcelona, Valencia) and South Spain ports (Seville, Algeciras), covering main European North Ports, UK, and Portugal.
In addition, there are also some short shipping carriers with special dedication to temperature-controlled or frozen goods who offer 45PW containers where you can load the same number of pallets as in a full truck. Due to Holland and Belgium having moderate winter conditions, we have even found some commodities being cross- docked at warehouses with limited temp-controlled capabilities. This has allowed for even greater savings in this multi-modal solution.
The main hesitation is the lengthy transit time and possibility of the cold chain being jeopardized. However, even though many assume this would increase the transit time by many days (thus decreasing shelf life and lowering the value of the product), that typically isn’t the case. You can manage lower costs to your supply chain while only increasing transit time by 24 hours or less. This solution has been used by those in UK, Scandinavia, and Benelux for years. It is time to start looking at which other destinations in the East can benefit from this multi-modal service offering.