Chronic port congestion in Manila has disrupted fresh produce supplies to the Philippines and quadrupled shipping costs over the last six months, much to the frustration of fruit and vegetable exporters and importers keen to profit from this exciting developing consumer market.
A day-time truck ban imposed by the Manila government last February, in a bid to ease the city’s traffic problems, left container ships backed up at the port quayside waiting for their cargoes to be offloaded for up to three weeks.
The delays had a devastating effect on perishable imports: decaying fresh fruits had to be dumped on arrival; certain shipping lines cut their services to the Philippines to avoid the costly queues; some exporters held back supply programmes; and remaining shipping lines’ costs quadrupled (rocketing from US$200 to US$800), while trucking prices doubled. Retailers scrambled for produce, and prices soared.
“It was a nightmare for everyone,” Catherine Posas of importer Dizon Farms told Fruitnet. “Everyone’s costs increased. Practically all imported produce has been delayed.”
The City of Manila tried to ease the congestion by periodically amending the truck ban, before finally lifting it indefinitely on 13 September.
However, such is the container backlog, officials anticipate it could take until early 2015 to clear all the cargo from the port. Speaking in September, Philippine trade secretary Gregory Domingo said some 78,000 shipping containers were stuck at the port, and only 4,500 containers are removed daily.
Nonetheless, many fresh produce importers and retailers were hopeful that post-truck-ban business would return to normal before the end of the year. And some key global produce suppliers, like New Zealand’s Zespri, Citrus Australia and Washington apple and cherries, reported successful export campaigns to the Philippines this season, in spite of the port-induced problems. Indeed, major container shipping line Maersk said it handled double the volume of fresh fruits and vegetable imports this year compared to last.
“With the strong economy and increased buying power across all social classes, commodities, such as imported fresh fruits and vegetables, are now more accessible by the general public,” said Wilyer Rodil, trade and marketing
Maersk-Filipinas. “This growth has been favourably felt by the transportation sector. This year, 2014, we are seeing double the volume of fresh fruits and vegetables shipped into Philippines compared to 2013. We continue to remain optimistic on the growth in the future not only for these commodities, but others as well.”
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