Creating the environment for efficient reefer logistics - the role of grower associations

1. Creating the environment for efficient reefer logistics - the role of grower associations Paul Hardman, Industry Affairs Manager Citrus Growers Association Reefer Logistics Forum Spier Estate 24th October 2008

2. Introduction • Citrus Historic Trends • What will the future of citrus exports look like? • Who should control the supply chain? • Role of growers associations • Conclusions

3. Historic Citrus Exports

4. Historic Citrus Exports

5. Historic Citrus Exports

6. Historic Citrus Exports

12. What will the future look like? • Will consumers turn to or away from fruit in an economic down turn? For how long? • Long term SA is very competitive supplier • Phytosanitary and sanitary measures and threats • CRI is work class by the challenges are significant • 22 day cold steri (USA, China, South Korea)?, Japan approves phtyo regime. • SA continues to meet high food safety standards • Taking advantage of opportunities • Access to non-traditional markets: India, Vietnam • More volume of citrus (100m cartons in 2010?) • Early and late-maturing varieties widening the windows for marketing • Successful transformation of the citrus sector

13. Budwood Sales

14. All Citrus Types

15. Who should control the supply chain? • Is this about who should take responsibility (individual supply chain)? • Surely those that pay for a service should be responsible (principle of ownership) • Surely those that take the risk should be responsible (principle of accountability) • Surely those that stand to gain (make profit) should be responsible (principle of value adding) • At operation level who tells the packhouse operator to “load the truck?” • Who is taking responsibility for creating long-term competitive advantage? • Separation of short and long –term interest • Coopetition • Who is taking responsibility for providing logistics support? • General information • Creating awareness

16. The role of grower associations • Creating the environment for logistics issues to be addressed (facilitation): • Positioned outside the value chain (no direct interest except to see export volumes maintained or increased) • Ultimately growers and farm workers probably have the most to lose • Start small, and focus on a few key projects

17. The role of grower associations • Creating the environment • Provide high level information • Weekly Logistic Summary • Dwell times • Specific problems (e.g. quality of pallets) • Providing capacity and a contact point: • Citrus Cold Chain Forum (research) • Port Planning/ Infrastructure • Facilitator

18. The role of grower associations • Potential projects in 2009: • Tonnage off Tar: Can more be done to coordinate and motivate for greater rail freight? • Maputo Port and Corridor: Raise the profile of citrus/commodities where planning is taking place • PE & Cape Town equally challenging problems • Measuring “barometer” indicators of how well the supply chain is performing during the year [Dwell times] • Truck Stop in Durban: The size and volume of trucks in the truck stop suggests there is much room for improvement here • Congestion in Durban • Provide information to planners regarding expected citrus volumes • Support the CCCF to ensure recommendations are taken up and applied / Communication

19. Conclusions • The historic trends of upward growth in fruit exporters are likely to continue, provided key challenges can be overcome: • Grow, Retain and optimized exports • Who should control the supply chain? • The entity most willing to take the responsibility • The entity will a long-term goal of optimizing the supply chain • Grower Associations can provide facilitation role but its up to roleplayers within the supply chain to “make it happen”.