Rotterdam Talks Food: Transport revolution is brewing in the food sector

By: Adriaan van der Giessen 03 Jul, 2017

Every month, the Rotterdam Food Cluster asks a changemaker in the food sector about innovations and new business models for anticipating and capitalizing on the Next Economy. This month we spoke to Michel Jansen, Managing Director at Total Produce B.V. in Waalhaven in Rotterdam, one of the largest actors on the European market in the area of the importation of overseas fruit.

The clustering of companies, governments and knowledge institutions is needed to realize multimodality, increased efficiency of customs checks and digitization.
The advent of alternative import markets, a growing market at home, the demand for cost-effective distribution and the ability to offer sustainable solutions for transport make it more important than ever to cooperate.

The transport revolution
There is no doubt that in the coming years transport will continue to evolve. Other modalities will appear on the horizon, because roadway transport is becoming increasingly more difficult and unreliable and the environment is playing an ever more important role. Consider, for example, train, barge (river transport) and short sea connections. Rotterdam has opportunities in these areas that other ports do not. If Rotterdam focuses its efforts on these opportunities and facilitates their growth, the positioning of the port will be even better. ‘We are still at the inception of these developments. For example, few trains are connected to electricity networks to cool products being transported. Regularly scheduled services are still not sufficiently available. Terminals must be located in the right spots. The volume of fruits and vegetables that is transported with alternative modalities is still very small. But I am convinced that this will grow in coming years,’ Jansen tells us.

Shifting imports to home market intensifies competition
More and more products in South America are being directly sold in their own or in neighbouring countries, and China buys large lots of goods in Africa. What does this mean for a company like Total Produce B.V.? ‘We are faced with large-scale competition from other sales markets. A number of up-and-coming markets in the Far East are becoming increasingly important, not only for the South American exporters but also, for example, for South Africa. In the past, Total Produce had nothing to do with these types of markets. Europe and America were the most important sales markets in the world. This shift has made the competition more intense. Purchasing power has increased in these new markets. On the other hand, the demands of the European market in the area of food safety are much stricter than in other markets. This sometimes makes our market economically less attractive,’ explains Michel Jansen.

You find the best service provision and cost efficiency in the Port of Rotterdam
Michel Jansen tells us about the unique service that the Port of Rotterdam offers: ‘The Port of Rotterdam is able to deliver a level of service that few other ports in Europe can match. That means that the flow of goods in the port is received in an efficient manner and is quickly transported to the hinterland via a finely branched network. Rotterdam has no influence on the export market outside of Europe. What Rotterdam can influence, though, is that the product goes to Rotterdam instead of to Antwerp, for example. Rotterdam can help importers like Total Produce B.V. to better arm themselves against this competition.
The checks on food safety must also be cost efficient. In some of these areas, Antwerp is less expensive; we at the Port of Rotterdam must be aware of this. A number of barriers that are part and parcel of importing must be handled in an efficient manner. We still have improvements to make in these areas.’

The ideal vision of the future for regional logistics
Michel Jansen’s wish: ‘The Port of Rotterdam is the starting point of AGF distribution or agro-logistics for a large portion of Europe.’ This results in an enormous competitive advantage for the entrepreneurs in the Port of Rotterdam. The customs and KCB settlement must occur so smoothly that the Port of Rotterdam is at least as effective and efficient at this as other ports are. The multimodal network ultimately produces choices and better alternatives for roadway transport. More sustainable transport solutions can be offered to customers. These choices can be made depending on specific needs: sustainability, cost or speed.

Good logistical service is benefited by large volumes, bundling and thick (bulk) flows. These can only be achieved if actors in globally splintered sectors, such as horticulture, work together. Total Produce is a large entity, but relatively speaking still a very small actor if you compare them to Unilever or Shell, who can set things in motion all by themselves in their own sectors. ‘To strengthen the sector as a whole in this region, we need clustering,’ says Michel Jansen.

‘We are faced with large-scale competition from other markets. A number of up-and-coming markets in the Far East are becoming increasingly important, not only for the South American exporters but also, for example, for South Africa.’

Michel Jansen Managing Director, Total Produce B.V.

The role of the Rotterdam Food Cluster
Michel Jansen believes that the Rotterdam Food Cluster possesses vision, passion and perseverance. According to Michel Jansen, these are indispensable fundamental starting points. ‘With a good mission that transcends the borders of different municipalities and administrative bodies, progress can be made. What is important here is that everyone is aligned. Otherwise, entrepreneurs will sit back or make decision themselves. Of course, the entrepreneur will also have to take action, but the Rotterdam Food Cluster can also initiate, facilitate and stimulate initiatives at a higher level. This has occurred in various areas, such as the Rotterdam Cool Port, a new refrigeration and freezer cluster located at the City Terminal in the Waal-Eemhaven. Since this location has many multimodal connections with both the container cluster on the Maasvlakte and with all of the surrounding Greenports and the final destinations in Europe, the Cool Port will substantially contribute to the sustainability and the efficiency of the fresh logistical chain.

One of the largest importers of vegetables and fresh fruit
The Total Produce Group is one of the largest suppliers of fresh fruit and vegetables in the world. Total Produce BV is an important import company within the Total Produce Group. North America, Central America, South America and Africa are the most important regions of provenance of fruit for Total Produce B.V. In addition, the company is also active in China, and in Asia generally. Its sales markets are the Benelux, Germany, Central Europe, Eastern Europe, Scandinavia and France.