Nearly a third of what the farmers grow in Africa is lost due to lack of refrigeration, poor market access and other related factors. Annual food losses for fruits and vegetables are an estimated 40 to 50 percent. But things are changing - with new partnerships, technologies, government efforts and better cold chain infrastructure, temperature-controlled supply chains are on the mend in Africa.

The most critical factor to keeping food and meat fresh is proper transportation and cold storage. Despite this, the cold chain system is still weak or nonexistent in some countries. Consistent refrigerated transportation instability is at the core of why cold chain logistics in Sub-Saharan Africa is nine times more expensive than anywhere else in the world.

However, there has been some progress with countries like Kenya and Ethiopia slowly addressing the many challenges due to a still-developing infrastructure. Traditionally, the key driver of these countries’ cold chain has been the fresh cut flower export industry, where Kenya and Ethiopia are positioned as one of the biggest exporters to the European Union (EU). The Kenyan and Ethiopian flower industries have created a strong strategic sector with advanced cold chain systems. However, the cold chain for other temperature-controlled foods, such as fruit and vegetables, has not yet advanced to the same level.

Ethiopian Cargo, the largest cargo operator in Africa, is making significant investments in the logistics of perishable cargo. The carrier is working on establishing dedicated product portfolios to serve the growing demand of pharma and perishables cargo. “To this effect, we have assigned dedicated employees by giving relevant trainings for professional handling and security management in order to ensure that quality services are rendered to customers. Required investments in cold storages, envirotainers, temperature monitoring devices, cold dollies, etc. are in place either directly or through outsourcing from prominent suppliers of such equipment,” reveals Fitsum Abady, managing director, Ethiopian Cargo.

Ethiopian Cargo is currently in process of getting IATA CIEV Fresh certified – the new industry certification to improve the handling and the transport by air of perishable products. Ethiopian also has a $150 million state-of-the-art cargo terminal at Addis Ababa International Airport, which has positioned the carrier to handle all perishable products based on their temperature requirements. Currently, the two terminals in combination have the capacity to handle over 450,000 tonnes per annum which makes it one of the largest cold storage warehouse. “This will be doubled with the second phase of warehouse expansion planned in the near future,” said Abady.

Perishable Logistics Africa

Fresh produce like coffee, meat, flowers, fruits and vegetables are now shipped around the world from Addis Ababa. Particularly in the transport of perishables, professional storage, seamless documentation and rapid transshipment play a decisive role and are also important prerequisites for trading with industrialised nations. The new air cargo facility expands the capacity of the existing air freight terminal and creates the conditions for the efficient transshipment of fresh goods.

Meanwhile, Kenya Airways Cargo is expanding its cool chain facility to deal with the extra demand during peak seasons, in addition to expanding its warehouse. It has also launched flights to John F Kennedy Airport in New York to enable access for Kenyan flowers to Miami, Toronto and Vancouver in North America. Today, Kenya exports flowers to over 60 destinations with more diverse opportunities available in the US, Japan, India, China, Canada, Australia, and Eastern Europe, according to the Horticultural Crops Directorate statistics.

Bringing more last-mile solutions to Kenyan fruit, vegetable, and flower businesses, Swiss-logistics company Panalpina Global invested $4.9 million in a cold storage facility at Jomo Kenyatta International Airport in November 2018. Panalpina president Stefan Karlen, in a press statement, said this investment confirms the firm’s faith in Kenya’s fresh fruit, vegetable, and flower business. Currently, the company operates a 3,500 square meter facility, with the investment extending it an additional 1,500 square meters.

The company aims to grow its business in Kenya from the current 65,000 tonnes of flowers, fruits, and vegetables it moves, to more than 80,000 tonnes by 2020. Panalpina’s growth in perishables has continued elsewhere in Africa, too - Skyservices in South Africa has joined the Panalpina family while FX Logistics, a new agent in Zimbabwe, has also became a member of the Panalpina Perishables Network.

“We started off [operations in Nairobi] with five jobs in 2015 before raising it to 200 employees when we partnered with Airflo and after we bought out the 75 per cent majority stake in 2016, we have since expanded our services and now employ 300 staff members,” Karlen said.

The company also said in a statement that Kenyan products are becoming more prominent in existing (mostly European) markets, but also in new ones, for example in Asia-Pacific. The company currently handles export of Kenyan produce to 26 countries across Asia, the Middle East, Europe, Australia and the US.

Supply chain fixes to avoid wastage
Despite much progress and professionalism in cold chain logistics, certain problems remain difficult to resolve. One of the main costs with the transportation of perishable products such as fruit and vegetables is wastage due to spoilage related to inadequate temperature management during transit. Perishables, much like pharmaceuticals, are sensitive and valuable products. There is a crucial need for standards throughout the process and in order to establish them, all parties of the supply chain must align themselves and collaborate, believe industry players. “Only then will we understand each other’s processes, needs, and requirements in order to provide the best outcome for the customer,” opined Stavros Evangelakakis, global product manager - healthcare & perishables, Cargolux Airlines and also at the helm of the Cool Chain Association.

“The key to transparency is collaboration and communication. All parties must be trustworthy and open about their processes and requirements in order to identify potential problem areas and establish suitable standards for all. One initiative, Flower Watch, was launched a few years ago, to encourage all supply chain players to work together towards one goal with three key points: knowledge, application, and leadership,” he added.

In fact, the Cool Chain Association has actually initiated a collaboration project between partners, forwarders, airlines, handling agents, and IT companies, to foster dialogue and open cooperation. “The results were recently revealed and they show promising results and we are looking forward to a more concrete evaluation over the coming months,” said Evangelakakis.

Africa’s perishables transport The cold hard fact“The industry is doing everything possible to bring stakeholders together in a collaborative mindset and creating a platform where stakeholders commonly refer their issues to solicit favourable solutions and action. Such platforms are called facilitation committees. The facilitation committee establishes working standards, communication protocols, escalation matrixes, issues resolution criteria etc. and establishes service level agreements (SLAs) with expectations (duties and responsibilities) clearly articulated against each stakeholder and to be signed between those stakeholders who are both operationally and commercially related. SLA enforcements and implementation status are reviewed and feedbacks are exchanged among stakeholders with request for action plan on improvement resolutions,” explained Abady.

In the case of Ethiopian Cargo, for instance, Abady explained, “First, we identify and map our stakeholders on continuous basis in order to accommodate emergence of new stakeholders. For instance, we used to have mainly horticultural exporters and corresponding service providing authorities such as customs, ministry of agriculture, phytosanitary agency, bank, etc. But now, there are meat exporters, manufacturing industry exporters etc. with their corresponding service providers such as ministry of health quarantine, national security etc. After identifying the stakeholders, we evaluate them in accordance to their interest and power towards the organisation so that we understand the extent of their impact and devise appropriate management styles. This way, we really are working with all stakeholders in harmony and that is why our business as airline both in cargo and passenger is significantly growing.”

Africa’s perishables transport The cold hard factSpeaking of the need to maintain product integrity at every stage of the delivery and hence the requirement for investments, Richard Tracy, vice president international programs, Global Cold Chain Alliance said, “While warehouses are a critical link in the supply chain, they are only one link. This means the cold chain has to begin with precooling on farms, include refrigeration during transportation, properly store products, and ensure the temperature is maintained during secondary transportation to the point of final sale. The cold chain must be secure from the farm to the consumer. If consumers demand it, retailers will invest.” For instance, Victory Farms, one of Kenya’s largest fish farms, has made significant investments in this area to make the cold chain as efficient as possible, with the installation of a five-tonne ice machine on the lake.

Investments are definitely being made and there is a drive to look for even more performing, innovative solutions for the transport of such sensitive commodities. In Kenya, for instance, there is an initiative to improve and implement a more standardised flower packaging box. The new design aims to decrease the amount of damaged products. By reducing the amount of different boxes, there are currently over 50 different models, it will help airlines to optimise their payloads.

For newly emerging economies in the African continent, the cold chain raises the prospect not only of reducing produce losses and strengthening food security, but also of upgrading agricultural ‘value chains’ to underpin development. In order to address the challenges and meet the priority needs for refrigeration in different agrifood subsectors, governments and other stakeholders, particularly in the private sector, must address issues concerning governance, technology transfer and improve dialogue on cold chain development.

This story was originally published in Logistics Update Africa's July - August 2019 issue.

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