1BMT De Beer b.v.

The Global Reefer TradeTrends, risks, claims and loss prevention

by

Jeroen de HaasManaging Director BMT De Beer b.v.,

Rotterdam / AntwerpNautical, cargo and technical surveyors and consultants

Director of BMT Survey Division, U.K.

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Reefer world trade

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Exotics

Meat

Dairy

FishCitrus

Deciduous

Bananas

Reefer trade by commodity (2004)

Source: Drewry

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Reefer cargo mode of transport (1)Stowed as breakbulk or on pallets on board a conventional reefer ship operated by specialist reefer carriers.

Total world fleet: +/-860 ships. Capacity up to 7.000 pallets per ship.

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Reefer cargo: mode of transport (2)

5th generation container shipsReefer capacity: 600-800 plugs per ship,

including under deck stowage.

Reefer container on board a container ship

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Reefer cargo: mode of transport

New “Hamburg Sud” - MONTE- class vessels (6)Total reefer capacity 1.365 plugs = 27.000 palletsAuxiliary power = 15.000 kW

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O t h e r s 3 0 %

H s u d 5 %

C P 3 %

C SA V 4 %C O SC O 4 %

N Y K 4 % H a n j i n

3 %

A P L 4 %C M A - C G M 6 %

P O N L 9 %

E v e r g r e e n 6 %

M SC 7 %

M a e r s k - Se a l a n d

1 5 %

Reefer container: plug capacity per carrier

Source:Company info / BRS Alphaliner / MDS Databank

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Others 22%

Hsud 4%

CP 2%

CSAV 6%

COSCO 4%

NYK 6%

Hanjin 4%APL5%

CMA-CGM 3%

PONL 10%

Evergreen 4%

MSC 7%

Maersk-Sealand23%

Reefer container: operated reefer containers

Source: Company info / BRS Alphaliner / MDS Databank

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LauCool / NYK18%

Seatrade, Netherlands

+Belgium21%

Others61%

Conventional reefer operators

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Reefer containers: operation

Cooling unit to maintain temperature, no cooling down!!

Cargo compartment

-25 dC to + 20 dC. (+/- 0,2 dC)

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Reefer containers: features / risks ($)

• Greatest advantage : flexibility

• Equipment valuenew: 20’ approx. USD 16.000,=

40’ approx. USD 19.500,=

• New buildings per year : approx. 100.000

• Owners / operators of reefer containers, very fragmented

• Financial risk in case of cooling failure restricted to 10 / 20 pallets

• Cargo claim risk : 0,3%

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Reefer containers: features / risks

Cargo value: (40’reefer)

• < € 50.000,= : fruit, vegetables, plants

• € 50 - 100.000,=: frozen fish, frozen meat, cut flowers

• € 100 - 250.000,=: chilled meat, frozen shell fish, flower bulbs

• > € 250.000,=: temperature sensitive cargoes, viz.electronic equipment, photographic film, computer chips, printer cartridges, medical supplies etc.

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Reefer vessel, features:

> Advantage: • Fast (20-24 knots), direct calls• No cooling interruption

> Cargo value : up to € 4 - 7.000.000,= per ship / voyage

> New buildings (2004): 4 ships

> Scrapped (2004): 30 ships

> Newbuildings required before 2012: 440 ships

> Aged world fleet

• Cooling capacity

> Heavily leaning on large-volume trades (bananas/apples/citrus)

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10-15 years

15-20 years

5-10 years

< 5 years

>25 years

20-25 years

Reefer fleet age structure

Source:LR-Fairplay

Total reefer fleet : 866 ships (2004)

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Reefer cargo means of transport.

Market share development

0%

25%

50%

75%

100%

1998 2005 2010

ReefercontainersConventionalshipment

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Reefer cargo, future trend - volume.

Global reefer cargo volume(million ton.), source : Drewry

30

35

40

45

50

2004 2005 2006 2007 2008 2009 2010

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Reefer transport, claims:

+

Cargo shift

Wet damage

Fuel contamination

Terminal problems

4%Delay transit24%

Stowage21%

Pre-shipment33%

System failure

18%

Containers, cause of claim(‘04):

Source : BMT De Beer

Conventional transport:

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Cargo shift, poor packaging / stowage

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Corroded piping (brine)

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Contamination / taint damage - fuelCracked tanktop

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Examples: Inherent condition of cargo

Climacteric81%

Non-Climacteric19%

Climacteric: fruit that ripensafter harvest (=become sweeter)

Climacteric fruitpeachescherriesnectarinespearsbananasavocados

Non-climacteric fruitgrapescitruspineapplesmelons

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Climacteric fruit (1)

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Proper cooling cycle, bananas

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Cooling failure, bananas

Too long cooling down Premature ripening,heat generation, ethylene explosion.

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Cooling failure bananas

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Climacteric fruit (2)

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Climacteric fruit (3)

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Containers, cooling failure, mangoes

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Class

PSC

P & I Clubs

ISM (int/ext.)

(Semi) governmental bodiesPPECB / USDA / NZEB

Weather routing

Crew education(Seagull)

Fruit majors

PTI

Loss prevention, vessel monitoring

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Loss prevention, reefer check

• Claim- and loss prevention survey (cargo worthiness items)

• Thermography : early detection of engine / equipment failures

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Generators, condition analyses

Aux. engine

Electrical fuse

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Infra red thermography

Temperature / valve check of brine line (-3,2 dC)

Kiwis

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Loss prevention, new programmes

+

Specialised Reefer Ship Association (SRSA)

360 Quality Code:- Harmonised reporting standard for terminals- Internal and external ship auditing.

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Consolidated manual on the transportation of perishable cargo in reefer containers

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Thank you for your attention!