Change is afoot for Asian food importers. As the demand for Asian food products increases, Asian food importers are shifting from the use of dry bulk cargo ships to container ships. This way, they can import smaller amounts at a cheaper rate per ton.
Typically, Asia commodities have been exported by bulk carriers, which can hold up to 70,000 tons of cargo. Now, as China’s demand for a higher protein and dairy diet has increased, the shipping industry is looking to fill empty containers once they have offloaded their goods in other countries. They’d like to offer competitive rates for shipping agricultural products back to Asia. Southeast Asian ports do not necessarily have the infrastructure for bulk receiving, so smaller transporters are seeing more opportunity. In addition, smaller containers require less working capital and allow more operational flexibility.
The U.N. Food and Agriculture Organization says that China is expected to bypass the European Union as the top pork users in the world, on a per capita basis by the year 2022. Additionally, there will be an expected increase in dairy product consumption by 38 percent.
Since the year 2006, United States containerized grain exports have more than doubled to Asia, up to 470,832 TEUs. And this is just in the first 10 months of 2013, which is a 10 percent increase year-over-year, says the US. Department of Agriculture’s data.
If there is going to be future growth in food transportation by containers, it is going to depend in large part on what the global demand for Asian manufactured goods is. The higher the demand, the more empty containers that will be available for exports back to China.
April has been working with Penn Intermodal’s Sales and Operations team to educate clients on the benefits of leasing chassis for bulk liquid storage and transport for approximately 7 years.