Features

Efficient harvests, effective transport can eliminate hunger (en)

3 junio 2019
ITC Noticias
How public-private partnerships to improve port infrastructure can positively impact the Global Goal

Post-harvest management is closely related to United Nations Sustainable Development Goal (SDG) 2 – ending hunger and all forms of malnutrition worldwide by 2030. The post-harvest system should be thought of as encompassing the delivery of a given crop from the time and place of harvest to the time and place of consumption, with minimum loss, maximum efficiency and maximum return for all involved.

Food loss refers to the decrease in edible food mass or nutritional value of food intended for human consumption. It is mainly due to poor infrastructure and logistics; lack of technology; insufficient skills; knowledge and management capacity of supply chain actors; and lack of markets.

On the other hand, food waste refers to food appropriate for human consumption being discarded. It occurs at the food-chain (retail and final consumption) level and relates to retailers and consumers behaviour. Food wastage also refers to any food lost by deterioration or waste and includes both food loss and food waste.

One third of global food wastage happens during post-harvest and transportation phases. For this reason improvements in liner shipping connectivity, enable worldwide efforts to reduce food insecurity in an increasing world population. For example, in the case of Costa Rica, post-harvest handling of pineapples and bananas serves a key role in minimizing post-harvest loss and increasing available global fresh fruit supply.

AGRICULTURAL EXPORTS

The Central American nation has in recent years been ranked years as the world´s largest exporter of fresh pineapple and among the 10 largest exporters of bananas. Pineapple exports from Costa Rica have increased up to 400% in the last decade, making it the top agricultural export product, above traditional ones such as bananas and coffee. The export destinations for these fresh fruits is mainly North America and Europe.

However, Costa Rican pineapple and banana exporters face logistics costs of up to half the value of the content of a container. Fresh fruit products have no tolerance for lack of cooling after picking. A clear example is pineapples, which are very vulnerable to unreliability and inefficiencies. It is estimated that unreliability, delays and hedging costs can add up to 26% of the costs per container to exported pineapples.

PORT INFRASTRUCTURE

As reported by Costa Rica’s Caribbean Port Administration Bord (JAPDEVA), in 2014, average waiting time at Costa Rica’s Limón-Moín terminals was 19.4 hours while berthing time was nearly 20 hours. Average delays were up to 15 hours, mainly due to low weather resistance, low productivity, closings and vessel crane breakdowns.

Costa Rica´s liner shipping connectivity – a measure of how well a country is connected through regular and frequent container transport – was until last year in the lowest quartile worldwide and the country ranked very poorly on the Global Port Infrastructure Quality Index.

Its port infrastructure until 2017 had impeded trade and caused high transport and logistics costs, including subsequent high costs for farmers and exporters due to food loss. Transport inefficiencies also caused delays; unreliability; long transport and lead times; increased inventory costs and proportional post-harvest food wastage.

Construction of the new Moín container terminal began in 2016 and operations started there in February 2019. The main driver of the terminal concerns reefer exports, mainly bananas and pineapples. Once the terminal is fully operational average waiting time is expected to be slashed from 19.4 hours to 1.4 hours, while average berthing time is expected to drop from 20.0 hours to 14.0 hours. Overall this corresponds to a total reduction in port turnaround time of about 60%. Also in the first years, an increase in container throughput from 1.10 million to more than1.36 million is expected as Costa Rican trade increases.

The new terminal is expected to eliminate 70% of current delays. By concession expectations, waiting time can be maximum 10% of the berthing time. Under these assumptions, average delay should be reduced to less than 2.4 hours.

Within only the first year of the new terminal fully operational and given there are six STS cranes in the new terminals, it is expected that the berth moves per hour (BMPH) will increase from 13 to more than 60. Also, given the increase in BMPH combined with the increased berth length and water depth allowing bigger fully cellular vessels, it is calculated the berth moves per call will increase from 915 to over 1900.

REDUCING TRADE COSTS

By reducing unreliability, the terminal is expected to reduce trade costs by 15% and consequently a reduction in post-harvest losses will follow. This may help improve the competitiveness of Costa Rica’s pineapple exporters, which despite significant improvements in productivity still spend around 45% of the costs insurance and freight price on transport and logistics.

The investment in the new Moin Container Terminal operated by APM Terminals are expected to drastically reduce inefficiencies, delays, unreliability, inventory costs and allow the percentage of post-harvest food loss happening to be reduced significantly. Local partnership and additional efforts to reduce food wastage APM Terminals and the Maersk Group are channeling efforts to reduce post-harvest wastage. In Limón, one of the ongoing corporate responsibility projects entails establishing APM Terminals as the strategic partner for a food bank branch to serve the port region. It is estimated 5,000 daily plates are delivered to the population through this effort.

Now that the Moín Container Terminal is operational, part of the efforts of the project will include distributing harvested fresh fruit and sub-products to regions of Costa Rica. These will come from our clients’ operations, mainly products that for some reason cannot reach the exportation phase (normally considered food wastage) but are perfectly adequate for human consumption. For example, a container carrying fresh pineapple that does not meet the size guidelines for international markets and therefore does not make it to the vessel- instead of being discarded -would be distributed through the food bank to local Costa Rican entities taking care of populations at risk, in example daycares.