Reefer Containers: The most demanded shipping container in second half of 2021?
Reefer Containers are experiencing a bigger crunch in the worldwide container shortage around the world, as compared to other types of standard shipping container. Especially in the second half of 2021, reefer containers are highly sought after due to the unimproved shortage of reefer containers. As backlogs continues to accumulate, demands continue to grow and reefer containers are not being produced or supplied enough.
But before we delve deeper into why reefer containers are so highly in demand, we have to understand that the very nature of the goods it carries, the perishables, are already in much higher demands and urgency, way before Covid-19 pandemic that made the congestion and shortage worse.
The tedious conditions involving the shipment of perishables
Perishables refers to any products/items in which quality decreases sharply due to environment or climate through time, such as meat and meat by-products, fish and seafood, dairy products, fruit and vegetables, flowers, pharmaceutical products, and chemicals.
Under the unique conditions and constant demand required for perishable goods, shipment for perishables anywhere overseas has to be quick and possess the ability to keep these products at a consistent low range of temperature.
This is where reefer containers comes to play.
A reefer container is designed to induce air distribution from the bottom, where it spreads cool air from the floor, via a specially designed T-shaped decking. This ensures a constant supply of air throughout the whole shipping.
A reefer container commonly comes with a built-in air cooling compressor with a common temperature setting ability between -25 to +25 degrees Celsius. This allows perishables to be kept in a cool temperature setting to prevent decay and spoil.
Stronger and faster growth in demands of perishables
Needless to say, reefer containers is constantly in demand, even before Covid-19 pandemic. This results in many of the things we have readily available to us today due to worldwide exports via reefer container shipping, which directly contributes to our overall economy.
During the pandemic, container shortage is becoming an increasing concern worldwide. Like the standard 20ft and 40ft Shipping container, reefer containers, also known as refrigerated containers, have been in extremely short demand, even till today. Since 1st April 2021, rates for both standard and reefer container risen exponentially through the entire world.
However, reefer containers are experiencing the deeper ends and resultant consequences of the shortage.
As compared with general merchandise, demands for perishables are much higher. This is because, perishables are not goods that are going to stay around forever. They will be purchased and consumed quickly. Hence, supply will definitely need to be consistent to meet the demand. A simpler analogy will be comparing an apple to an iPhone. There will always be consumers purchasing apples everyday, but the same crowd of consumers will not be buying an iPhone everyday.
Secondly, as the world recover and open up post lockdown, many containers are exported but many of the containers are not returning quick enough.
Higher demands for reefer containers meant that more reefer containers are shipped and not returned, as compared to standard shipping containers. For instance, transit times for seafood moving from South-east Asia to Japan have risen dramatically. However, this ended up causing a lack of available plugs at transit stations, stalling the entire traffic.
The vessel berthing schedules has been being postponed and too many reefer containers are queued for the berthing. This ended up causing many reefer containers being stuck stagnant at one place.
Overall, this caused a worse shortage problem for reefer containers. According to industry’s observation, shipping produce from Chennai to Thailand now takes 45 days or more as of today, as opposed to 18 days before the pandemic.
According to the Australian Dairy Products Federation, the dairy industry in the state of Victoria has faced delays of up to a month for its exports too.
How Covid-19 further impacts the overall reefer container shortage
Due to the very easily spreadable nature of the Covid-19 virus, plus the possibility of contamination of the perishable goods, most countries are imposing inspection of reefers for traces of Covid-19. For example, Hapag-Lloyd informed that due to the instructions issued by local authorities, all reefer shipments to Tianjin, China are required to complete an inspection and test for COVID-19 before release.
This has resulted in thousands of containers being logjammed in many ports around.
Furthermore, most countries are looking to enforce and encourage Covid-19 vaccination for their citizens. Hence, millions of Covid-19 vaccine units are distributed worldwide, which will require only reefer containers. This will further strain the shortage of reefer container supplies too, as priorities will be given to transport these vaccines, likely backed by the government’s budget worldwide.
On the other end of the spectrum, reefer containers have also been used to store bodies of those who died of Covid-19 complications. For instance, On 31st July 2021, it is reported that Thammasat University Hospital near the capital Bangkok, began employing reefer containers to store the dead bodies after capacity maxed out for their morgues. “There’s not enough space, so we bought two containers for bodies’ storage,” Prof Pharuhat Tor-udom, a director of the hospital, told Reuters, adding the containers cost about 250,000 baht each. In New Delhi, India, the Centre-run RML hospital here has procured reefer containers to store bodies in view of coronavirus fatalities as its morgue is reaching full capacity as well.
Supplies for reefer containers will hence be undermined as many countries begin to adopt reefer containers as morgue.
20ft Reefer Container Morgue Photo: Zhendre
Measures taken to help ease reefer container shortage
The resulting effects of the global Covid-19 pandemic has clearly outlined the key role of reefer container to keep steady stream of supply for food and medicines, especially vaccines, flowing around the world as nations locked down. The pandemic caused many disruptions to the whole container supplies around the world.
Hence, to better combat the shortage problem, the most important thing that needs to be addressed is definitely how to reduce supply chain delays and disruptions, in order to improve the overall efficiency of container shipping. Specifically for reefer containers, it has been suggested that digitalisation of reefer container operation is required, specifically in the prospects of Real-time visibility and remote control.
Implementation of Internet of Things (IoT) telematics are expected to be factory installed in new reefer containers to allow reefer containers to be remotely located and monitored around the world.
Reefer containers equipped with IoT devices and sensors helps to provide real-time and historical data for carriers and shippers, which directly helps deriving data analysis of the logistics and sea transportation. From there, carriers and shippers will better understand and manage visibility black holes at sea, make onboard reefer monitoring safer for seafarers, and allow shoreside staff to remotely monitor conditions. Ultimately, this will fasten the efficiency and process of container shipping, which contributes to the easing of container delays and hence, shortage.
The rise of the virtual Pre Trip Inspection (PTI), replacing a manual inspection, will also improve operational efficiency. A Reefer pre-trip inspection is an extensive check of both the container and the machinery prior to transportation. It ensures that the reefer machinery is running properly at correct settings (for its goods) and that the container is clean and undamaged.
Hence, if conducting virtual PTI on-board ships becomes more prominent and quicker than manual PTI, ideally the offloaded reefer containers can get back into circulation more quickly, meeting the demands.
If you would like to buy/rent reefer container/shipping containers, explore the feasibility of using repurposed shipping containers for your premises, or even use containers as a setting for filming, feel free to speak to us today.