Produce: How DHL can help Abayomi Adetola Commercial Mgr DHL Aviation - PowerPoint PPT Presentation

Logistics, Warehousing and Distribution of Agricultural Produce: How DHL can help Abayomi Adetola Commercial Mgr DHL Aviation Lagos, March 2012

Introduction Agricultural produce are goods representing the largest percentage of FMCG (fast moving consuming goods), they will deteriorate over a given time period if exposed to extreme temperatures (heat or cold), humidity, expanded time or other environmental conditions ✓ Fruits & vegetables ✓ Meat & sea food ✓ Live cut flowers and plants ✓ Goods requiring specific conditioning/monitoring Fresh agriculture produce market is a buyer’s market, consumers pay more attention to quality, safety, packaging, etc. Worldwide ≈ 2,7 million tons of perishables Main export continents: Latin America & Africa: up to 80% of all airfreight export Main import continents area: Europe, North America, MEA & Asia Agric Fair Lagos 30 th March 2012 Page 2

Storage and Warehousing The handling and management of the entire logistics process of produce need a temperature controlled supply chain Products safety has direct impact on the consumer’s health. – Perishables (fruit & vegetables) are living products with limited shelf life after harvest: – Continue process of respiration after harvest (CO2, H20, heat) – Heat up after harvest – Rate of deterioration is determined by rate of respiration – Rate of respiration is directly proportional with temperature Responsibility of everyone involved from production to retail sale A breakdown in temperature control will impact on final quality Adequate warehousing • Multiple cold stores that can be set to various temperatures • Air conditioned working areas • Cold rooms Agric Fair Lagos 30 th March 2012 Page 3

Africa production of Fresh Produce (1000) tons in 2010 35,000 NG is second largest country in Africa and largest country in SSA 30,000 25,000 20,000 Veg Fruits 15,000 Total 10,000 5,000 0 Cameroon Congo DR Côte d'Ivoire Ethiopia Egypt Nigeria Uganda Morocco Tanzania Ghana Tunisia Sudan Burundi Guinea Algeria Kenya Malawi Libya South Africa Rwanda Source FAO Agric Fair Lagos 30 th March 2012 Page 4

2010 Export from SSA top 15 exporting countries by air to EU Top 15 countries represent 98% of exported tonnage 160000 140000 345,938 tons 120000 Misc E&M and HT 100000 Constr. Mat. 80000 Clothes L&S 60000 O&G PER 40000 20000 0 KE ZA ET UG GH TZ ZW SN NA CM CI NG ZM BJ CD 90% of exported commodities are Perishables Source Eurostat Agric Fair Lagos 30 th March 2012 Page 5

Percentage of perishable products exported ex-Africa to EU Agric Fair Lagos 30 th March 2012 Page 6

AIRFREIGHT PERISHABLES 2010: AFR-> EU Fresh fish ≈ average value/kg = 6,89 US$ Agric Fair Lagos 30 th March 2012 Page 7

AIRFREIGHT PERISHABLES 2010: AFR-> EU Flowers ≈ average value/kg = 6,13 US$ Agric Fair Lagos 30 th March 2012 Page 8

AIRFREIGHT PERISHABLES 2010: AFR-> EU Fruits ≈ average value/kg = 4,08 US$ Agric Fair Lagos 30 th March 2012 Page 9

AIRFREIGHT PERISHABLES 2010: AFR-> EU Vegetables 60000 ≈ average value/kg = 3,67 US$ 50000 TONS EXPORTED TO EU 40000 30000 20000 10000 0 Morocco Mozambique Kenya Egypt Ghana Ethiopia Uganda South Africa Zimbabwe Cameroon Zambia Agric Fair Lagos 30 th March 2012 Page 10

Fast growing markets Africa: PERISHABLE MARKTES EX AFRICA (2007 in comp. 2011): • Fish: • Kenya + 36% • South Africa: + 7% • Senegal: + 3,8% • Vegetables: • Ethiopia: + 72% • Kenya: + 15% • Egypt: + 7% • Fruits: • Ethiopia: + 245% • Cameroon: + 12% • Ghana: + 10% • Kenya: + 4,53% Fresh Fish • Flowers: • Ethiopia: + 455% Fruits • Kenya: + 188% • Tanzania: + 21% Vegetables Flowers Agric Fair Lagos 30 th March 2012 Page 11

Summary  NG is the largest SSA country producing perishables but it doesn’t export  NG farmers waste nearly 60% of their production due to:  Lack of decent road network from farms to the markets  Security  Check point  Non functional rail system  Non-availability of cold storage facility for preserving goods.  Market low buying power  EU market is looking for new source of perishables globally  Selling price between local market and EU market is 1 to 3 (or 4)  Are we ready to export? Agric Fair Lagos 30 th March 2012 Page 12

DHL Solution We’ve Got The Planes Agric Fair Lagos 30 th March 2012 Page 13

DHL Aviation: a Business Unit of DHL Express DHL Aviation EXPRESS Division LOGISTICS Division Worldwide express Worldwide logistics Customized logistics services – ranging from solutions for road, air and solutions from consulting documents and parcels to ocean freight, supported by to supply chain design, pallets; our network a dedicated team of from warehousing and consists of 5,000 branches experts for industrial distribution logistics and serves more than projects and sophisticated to order management 120,000 destinations IT applications DHL Express air network is run by DHL Aviation Agric Fair Lagos 30 th March 2012 Page 14

16 DHL aircraft operating in SSA DHL Aviation 1 x Boeing 767 2 x ATR 72 50t 8t 1 x Antonov 32 2 x Boeing 727 6.7t 23t 4 x ATR 42 2 x Beechcraft 1900D 4.5t 2.5t 3 x Cesna 208B 1 x Cesna 406 2.5t 2.5t Total payload for the area: 151.7t/day 5 days a week Except B767 flies 6 days a week Agric Fair Lagos 30 th March 2012 Page 15

Sub Saharan Africa Aviation - Network MAD NKC BRU NKC MAURITANIA MALI NIGER NIM B767 BKO OUA DKR SENEGAL BUKINA BENIN FASO GUINEA B727 x 2 TOGO NIGERIA GHANA CKY SIERRA LEONE COTE LIBERIA FNA LOS D ’ IVOIRE ATR 72 x 2 CAMEROON MLW COO LFW DLA ABJ ACC UGANDA ATR 42 x 3 SSG LBV EBB GABON KENYA CONGO DR CONGO POG KGL B1900D x 2 RWANDA NBO FIH BJM PNR BURUNDI C208B x 3 CAB SZA TANZANIA DAR LAD C406 PNR ANGOLA ZAMBIA AN32 CAB LUN SZA HRE B 737 LAD ZIMBABWE NAMIBIA WDH MPM JNB SOUTH AFRICA Agric Fair Lagos 30 th March 2012 Page 16

Commodity carried by DHL Aviation from SSA DHL Aviation MISC DG 3% 1% FMCG 26% PER 52% AUT 1% E&M 12% LS FLOWERS 3% O&G TECH 0% 1% 1% Agric Fair Lagos 30 th March 2012 Page 17

Transportation of Perishables: The Supply Chain DHL Aviation Day 0 Harvest Day 0 night : Trucking to airport Day 0 : Conditioning Day 1 am : Palletization at airport with Day 1 am : Loading on aircraft Day 1 am : First flight to LOS carton angles to strengthen pallets Day 1 pm : 2 nd flight to BRU Day 1 evening : Adelantex takes over Day 1 pm : Transfer at LOS airport Around 6h 30mn from the apron 2 hours max Day 2 @ 3am : Adelantex trucks Day 2 @ 6am : Goods at markets Total Turn Around Time from Harvest to market: less than 48h Agric Fair Lagos 30 th March 2012 Page 18

Conclusion The needs to develop right product for the right market: • Listen to requests of the market • Certification (Group with AFGEAN) • Respect regulations & comply with laws/requirements Minimize production loss • By optimizing cool chain & packaging • Avoid loss of shelf-life to increase margins Buffering seasonality by: • Year-round production through different products • Capability of peak handling & storage Use experts in key-logistics & handling Agric Fair Lagos 30 th March 2012 Page 19

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