Econostrum | Economic News in the Mediterranean

Egypt: Containerisation has led to the development of a traditional sector

Steven Suchet, Reefer Trade Director at CMA CGM

on Thursday, April 18th 2013 à 10:30 | Read 1199 times

Egypt: Containerisation has led to the development of a traditional sector

“ Today, we are the world's second largest shipper of reefer containers ”.

Steven Suchet, Reefer Trade Director at CMA CGM (Photo CMA CGM)

Every year, Egypt produces five million tonnes of citrus fruit, around 20% of which it exports, essentially to Russia (28%), Saudi Arabia (25%), Persian Gulf countries (10%) and northern Europe (10%).

Egypt enjoys two advantages over its principal competitors, on the one hand, an ideal location at the confluence of the major shipping lanes and on the other hand, lower production costs. The challenge for a shipping company is to be able to place the 42,000 40’ reefer containers necessary to transport the million tonnes of produce during the citrus fruit season.

The challenges for the future

If the shipping of citrus fruits in refrigerated containers has proved to be the most effective technical solution, the Egyptian market still, nonetheless, has to face risks related to a volatile political and social situation which could negatively impact prices. At USD 500 per tonne, Egyptian prices are currently 20% lower than those of their main competitors, however, this situation could deteriorate if production costs were to rise due to social pressures and if, on a logistics level, this same social pressure was to disrupt the processing and port operations.

By supporting Egyptian exporters and providing them with innovative solutions, CMA CGM has enabled them to develop and conquer new markets however it is now up to these exporters to preserve the conditions for their competitiveness.

CMA CGM, a partner providing innovative services

CMA CGM, the world’s third largest container shipping group, today operates 14 services that call at an Egyptian port and offers its customers a fleet of 150,000 TEU reefer containers, 30% of which are latest generation units, environmentally friendly thanks to their low energy consumption. Lastly, CMA CGM has set up a dedicated "reefer" service involving its commercial and operational staff and its contacts on every farm. In order to meet the growing demand of Russian consumers, in 2012 CMA CGM launched a new service, the Citrus Express, linking Egypt with Novorossiysk, the Russian Black Sea port.

This decision illustrates our capacity to anticipate customer needs and confirms the strategic priority given to the development of markets requiring temperature-controlled transportation. Today, we are the world's second largest shipper of reefer containers.

CMA CGM offers Egyptian exporters fixed-day weekly services and competitive transit times of seven days to Novorossiysk, three days to Jeddah, ten days to the Gulf countries, twelve days to Great Britain and sixteen days to South-East Asia. Reliability and quality of service have enabled CMA CGM to become the Egyptian market leader with close to 20% market share.

Special issue : A new citrus route emerges in the Mediterranean

Special issue in partnership with Medfel

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