The Ethiopian Shipping and Logistics Services Enterprise (ESLSE) is gearing up to procure its own reefer containers for the first time with the aim of aligning with the growing interest in shorter shelf-life commodity consignment via vessels.
Ethiopian Horticulture Producer and Exporters Association (EHPEA) welcomes the move that would make its members more competitive in the global market.
The public logistics giant that is currently using leased reefer containers for commodities mostly that are at the trial stage, has floated an international bid for suppliers to purchase 31 40 feet MGSS reefer containers.
Roba Megersa, CEO of ESLSE, told Capital that the enterprise is opting to buy the reefer to support the export rather than for revenue-oriented purposes, “this initiative is not for profit-oriented but we want to support the export of perishables.”
He told Capital that ESLSE has already facilitated two hectares of a dedicated terminal at Mojo Dry Port for reefer cargo handling and power plug-in service.
“As per our plan in the short term we will have up to 50 reefer containers to accelerate the export of agro-industry products,” Roba added.
The consignment of reefer cargo is limited in Ethiopia to which experts said that Freighters International, one of the well-known private logistics companies in Ethiopia and has long-term agent partnership with the leading containerized cargo operator of Danish-based Maersk, is stated as operating in the sector.
Wondimu Denbu, Deputy CEO for Corporate Service at ESLSE, told Capital that ESLSE has been floated the bid two times to which sufficient and qualified suppliers did not participate.
“Mid this week the third bid was expected to be opened, however, it was pushed by about two weeks as per the request of suppliers, who are interested to participate in the bid,” he explained.
The consignment of perishable cargos through vessels is highly recommended since it has a competitive advantage in the global market. The issue has been frequently raised by Ethiopian fresh producers and exporters like fruit and vegetable sector actors.
While the government has been carrying out different initiatives and several pilot operations to export perishable commodities through vessels are packed with reefer containers. For instance, recently Ethiopian avocado has been exported through the new initiative to the European market.
Tewodros Zewdie, Executive Director of EHPEA, said that the lack of reefer containers is the weakest link for the sector business and its supply chains.
“After lack of ample cold warehousing and other issues, the availability of reefer container is one of the challenges for sector competitiveness,” Tewodros told Capital.
“Next to flower, which is the second biggest export earning commodity for Ethiopia after coffee, the export of fruits and vegetables is our competitive advantage on the global market; ESLSE’s current move is a good opportunity for the sector,” he explained.
He said that cost of reefer containers and the availability of the box is pivotal to expanding the fruit and vegetable export.
“The decision of ESLSE is to some extent improve the availability of the reefer container,” he added.
Experts said that using vessels means a less costly mode of transport besides enabling to manage the shipment of bigger size of cargo other than airfreight.
They added that cool logistics investments, by drastically reducing transport costs and lead times, can unlock Ethiopia’s perishable industry.
Ethiopia is working to strengthen the cool logistics corridor that links farms with dry ports and railway network system up to sea port at Djibouti. The cool supply chain at Mojo is part of the new initiative.
ESLSE has also expanded its container ownership from about 3,000 to close to 14,000 different sizes of containers in a very short period.