"Food sector transport on the verge of a revolution"

Every month, Rotterdam Food Cluster asks a change maker in the food sector for innovations and new business models to weigh in on The Next Economy. Michel Jansen, Managing Director of Total Produce B.V., which is located in Waalhaven, Rotterdam, had the floor this time. This company is one of the largest players in Europe when it comes to importing fruit from overseas.

A clustering of companies, government, and knowledge institutions is needed to achieve, inter alia, multi-modality, ease of control and digitalisation. Co-operation has become even more important. This is due to the arrival of alternative import markets, a growing local market, the demand for cost-effective distribution, and providing sustainable transportation solutions.

The transport revolution
Transport is going to, undoubtedly, evolve even further in the coming years. Other modalities are being developed as road transport becomes increasingly difficult and unreliable, and the environment is playing an increasingly important role. Think of, for example, rail transport, barges (river transport) and short sea connections. Rotterdam is better suited for these than other ports. If Rotterdam works on it and helps facilitate these, it will put the port in an even better position. "We are still at the beginning of these developments. Few trains have electrical connection in order to, for example, keep products cool. There are not enough lines available. There have to be terminals at the right places. The amount of fruit and vegetables that are transported by these alternative modalities is very small. I am convinced that this will increase in the future", says Jansen.

Shift from import to local market increases competition
In South America, an increasing number of products are being sold directly to local and surrounding markets. China also buys large quantities from Africa. what does this mean for a company like Total Produce? "We are getting more competition from other markets. A number of emerging markets in the Far East are becoming more important, not only for South American exporters, but also for countries like South Africa. In the past Total Produce had nothing to do with these markets. Europe and America were the most important markets worldwide. This shift means more competition. Buying power has increased in these new markets. In contrast, food safety regulations are far stricter in the European markets. This sometimes makes our markets less attractive", says Michel Jansen.

Best service delivery and cost effectiveness
Michel Jansen explains the unique service that the port of Rotterdam has to offer: "The port of Rotterdam is able to deliver services few other European ports can. This means goods are received in the port in an efficient manner and are then transported inland via a fine tuned network. Rotterdam has no influence on the export market outside of Europe. Rotterdam can, however, ensure that a product goes to Rotterdam and not, for example to Antwerp. Rotterdam can help importers such as Total Produce B.V. to better equip themselves against the competition.

Food safety control should also be cost-effective. Antwerp is less expensive in certain aspects, which we at the port of Rotterdam need to be aware of. Certain thresholds with regard to import must be met in a cost-effective manner. This is something we need to improve on."

The ideal future image of regional logistic
Michel Jansen's wish is that: "The port of Rotterdam becomes the starting point of AGF distribution of agro-logistics within a large part of Europe." This offers a huge competitive edge for businesses in the port of Rotterdam. Customs and Quality Control must be done in a flexible manner to ensure that the port of Rotterdam is, at the very least, as efficient as other ports in this regard. The multi-modular network ultimately provides choices and better alternatives to road transport. More sustainable transport solutions can also be offered to clients. This choice can be made depending on the need: sustainability, cost of speed.

Good logistical services benefit from large volumes, combinations and heavy flows. This can only be achieved if there is co-operation in the globally fragmented sectors such as the agricultural sector, work together. Total Produce is a big company, but is still relatively small when compared with Unilever or Shell, who can put things in motion in their own sectors. "We need clustering in order to strengthen the sector as a whole in this region", says Michel Jansen.

Source: Rotterdam Food Cluster