We are seeing more cargoes traditionally air freighted now shifting to reefer transportation. What’s the biggest impact of this cool change?
One challenge is the amount of time it takes to transport perishables by sea compared to air. However, the technological advancement of reefer technology is eliminating this concern. Innovation such as controlled atmosphere allows cargos previously delivered only by air to travel by sea, while still maintaining the product’s freshness, lifespan and quality. By transporting perishables in reefers, customers are able to purchase a variety of goods at a low cost, while ensuring that they are as fresh as those transported by air.
What challenges has this opportunity presented to the major container carriers?
Container carriers must be capable of not only precisely controlling temperatures but it becomes inevitable to invest in technologies that allow the atmosphere surrounding the cargo to be controlled, therefore maintaining the cargo quality even on long voyages.
In today’s depressed market, reefer capability provides both shippers and shipping lines an opportunity to provide new services and added value to their customers. Even though reefer containers constitute a modest portion of the total global container market - about 3% - the expectations of growing demand for imported food items, not least in newer growth economies, represent a significant explanation for the carriers' increased focus on the reefer market, a focus which at the same time could compensate for the lower rates on "dry" containers.
What are the main challenges to avoiding spoilage on cargoes such as fresh flowers/fish? It must be even more difficult when those types of cargoes are being shipped to climates such as the Middle East?
For fresh flowers, not only controlling the temperature but also controlling the humidity becomes a challenge. In addition, it may be necessary to control air volume and air composition surrounding the cargo as well. Reefer containers are designed be operated continuously under climates of up to 50 degrees Celsius. Therefore, it is able to operate without problems in most cases.
What key technological advances Daikin has made to keep pace with these new market trends?
Daikin has developed an Active Controlled Atmosphere (Active CA), which controls Oxygen levels inside the container quickly. With this technology, we are exporting high-end fruits and vegetables from Japan that could previously only be transported by air. Daikin’s Active CA charges a nitrogen rich gas into the container, which reduces the respiration of the cargo by reducing the oxygen concentration. It also creates a positive pressure inside the container, which prevents outside air from entering. This leads to a fast reduction of O2 concentration, which makes our CA suitable not only for long voyages but short voyages too.
Another technological advancement would be our inverter system, which helps to deliver significant energy savings and reliability. Traditional single-speed compressors deliver a fixed amount of cooling and heat and operate on a ‘stop-start’ principle, maintaining the set temperature. By contrast, inverter compressors run at variable speeds, allowing cooling capacity to adjust precisely according to cargo needs, thus reducing total operating costs and CO2 emissions. This characteristic is very important when the reefer travels through areas such as the Middle East where the outside temperature can be extremely high.
How much does remote monitoring play a part in reefer transportation nowadays?
It’s increasing. For example, at terminals and depots where reefers come and go/stay, remote monitoring systems allow repairers to take swift action when there is an alarm signal from any of the machines. Nowadays, remote monitoring systems are very effective as a tool to communicate between the machine and the operator.
Is shipping lagging behind other sectors when it comes to the use of such technology?
It is very difficult to compare the reefer industry with any other because reefer containers travel across the world and units spend large amounts of time at sea. Therefore, the network infrastructure is very different and the technology used has always focused on robust equipment, specifically designed for extremely harsh and varied operating conditions. Technology is changing and remote monitoring is part of this. Leveraging the Internet of Things and Big Data to control and manage the operation of reefers will certainly play a central role in the evolution of the reefer industry over coming years.
What key markets are you seeing growth in and what is driving this?
Due to technological advancements in reefer technology combined with a growth in disposable incomes, there is a demand for certain produce that was previously unique to a certain country or region.
The demand in produce diversity consequently leads to a shift in transporting methods: from air to reefers. In addition to this shift, cargo quality is important and consumers are becoming more critical and demanding. As a result, we predict that reefer containers equipped with controlled atmosphere will increase in the future, reducing cargo loss during transport as much as possible and assuring the cargo quality when it reaches its destination.
What opportunities does Daikin snticipate across the Middle East?
It is expected that opportunities in Iran and the UAE will grow quickly. To support this, Daikin has visited Iran to expand our service network and facilitate training seminars to technicians from multiple customers. In addition, Daikin opened a spare parts centre in Dubai last month.
How has the economy of scale evolution in shipping affected the reefer business?
As long as people consume imported food, there will not be a big change in consumption quantity, thus there will be no big changes in the reefer business itself. However, as the demand for food increases, the demand for reefers will increase as well. When the ship size increases, evidently, there is an increase in the loading and unloading of cargo, which leads to an increase in many other procedures that are affiliated with the import and export of cargo. For a smooth operation, all of these procedures need to be accurately completed at a fixed speed, even faster than before. Therefore, it is essential for the machine itself to operate accurately with the aid of remote monitoring systems on board and at terminals, for example.
What are your predictions for the evolution of the market in the coming years?
The market is tough and most major container ship lines reported negative operating margins in the first quarter because of record low freight rates. Despite this, the expanding global cold chain stands out as a bright spot in the international trade and transportation sector. As eco-efficiency drivers continue to influence the buying decisions of both shipowners and shippers, it is this married with maximum reliability that remains central to the evolution of reefer technology.Reliability will remain paramount, especially in challenging economic times. If the reefer container isn’t functioning in some way, then the cargo will almost certainly be damaged. The risk of damaged goods, plus the added reputational damage from a lack of reliability is high. Therefore, increasing the reliability of the refrigerating system on reefer containers will continue to improve even further. By utilising the Internet of Things and Big Data to control and manage the operation of reefers, we will be able to optimise maintenance, prevent breakdowns and safeguard against mistakes made through human error.
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