Yogurt culture grows
Consumers worldwide are looking for healthier food options, says Chris Connell, president of Commodity Forwarders Inc. (CFI).
The perishables freight forwarder is seeing additional foods being transported by air. Most food CFI ships comes from the U.S.
“From our fresh fruit and veg business, we’re seeing a lot more different types of commodities going airborne, but we’re also seeing items like our protein business – which is yogurt and meat and cheeses – continuing into different markets as well,” Connell says. “We might see a volume drop in one commodity, but we’re seeing additional commodities to create diversification within the subgroup. That’s allowing us as an overall company to see more exports.”
CFI has been flying more yogurts in the last year than just four years ago.
“People like to eat better, feel healthier and we’re seeing that growth surprisingly continue in the non-pharma perishable marketplace,” he says.
CFI usually ships yogurt by air for new product rollouts. Some yogurts also have a shorter shelf life that requires airfreight to be in the mix for either the finished product or its ingredients.
For new product rollouts, companies don’t necessarily maintain big inventories in non-U.S. countries, so more of a just-in-time system is in place.
“As that brand or commodity gets acceptance, then they eventually start rolling it to inventories,” he says.
Eventually, the long-term supply chain will push those yogurts to oceanfreight, Connell says.
“When you move a huge amount of commodity inventory, money’s stuck in inventory,” he says. “We did see during the fiscal crisis some of that pushed to airfreight because people were still eating, but they didn’t want their money tied up on the vessels.”
CFI’s protein air cargo business is growing in the Middle East, the UK and Asia.
Some of this is likely driven by the food scares in China and other parts of the world, he says. The scares have some high-end retailers looking into a more secure source of food quality, which Connell says has probably contributed to the rise in CFI’s protein business in the last year.
“At the end of the day, the U.S. is a high-quality food supplier,” he says. “And when there is insecurity on where your food comes from in the supply chain in certain countries from time to time, the U.S. tends to be able to pick up the slack as a sort of assurance policy because we have some very positive brands within the U.S. that translates well to keeping the consumers a bit more secure in their choice.”
In 2014, CFI is focusing on continued investment in its IT and cool chain infrastructures, adding new coolers to its Seattle operation by the end of March.
E-freight is also on the table.
“There’s a lot of push on how we’re transferring information to and from the airlines, so our goal is to continue to handle more transactions via an e-cargo environment,” Connell says, “but not just do that to our airline vendors but how do we also then get information from our customers to help reduce the manpower.”
CFI is marking its 40th anniversary this year. The company started in 1974 shipping strawberries from California to Germany.