Cold Cargo: Expertise and careful planning are required to keep things exactly cold enough.
"Examples of chill freight are products such as dairy, eggs, meats, fruits, and vegetables, which often have a shorter shelf life, so it's critical the supply chain runs effectively to transport these products to market," explains Steve Hartmann, vice president of sales and marketing for Lynden Transport. "Frozen items are generally less time-sensitive and include things like ice cream, meats, pizzas, vegetables, and quick meal entrees--everything you'd find in the freezer section at the grocery store. "Seafood is very important to Alaska and can be moved as either chill or frozen depending on the destination, packaging, and service level required," he adds.
Getting Products Where They Need to Be
According to Larry Felix, vice president of sales at Carlile Transportation, when it comes to chill or frozen freight, far more of it enters the state than leaves it.
"Approximately 90 percent of our refrigerated services, which includes both freeze and chili, come northbound to Alaska's consumer market. Of 1,000 shipments in and out of the state, only 100 are headed south," he says.
"Our northbound shipments remain pretty consistent year-round, while there is a surge during tourist season, the state's population usually remains around 730,000 people who eat and drink the same amounts every month."
Major population centers such as Anchorage, Fairbanks, Kenai, and communities in Southeast receive the bulk of the grocery items. Temperature-controlled freight moving out of Alaska largely comes from major seafood processing points like Dutch Harbor, Naknek, Kodiak, Cordova, Anchorage, Valdez, and points in Southeast.
"Most of the food moving into the state is moving for major grocery distribution centers from the Pacific Northwest," says Hartmann. "There are some nonfood items that move to Alaska; for example, every spring there are multiple loads of plants and flowers moving to the state that require protective temperature control."
Road, Water, and Air
Shippers have a number of options, including transporting goods by steamship, barge, road, or air. Time and cost are the most important factors, as is flexibility-having access to transportation assets as needed.
"We offer full load and LTL [less than full load] service for both refrigerated and frozen items from Tacoma to Anchorage, with the same southbound return," says Terry Umatum, director of sales and marketing at Carlile. "if it's traveling on the ocean, it's usually completely frozen; it can be fresh if delivered by road."
Over-the-Road (OTR) transportation takes far less time, arriving to its destination approximately two to three days before steamship loads.
In the case of seafood being transported from Alaska, "Price decreases as time increases from the origin to destination because the value of the product coming out of Alaska changes dramatically," Felix says. "It takes fifty-six hours to go from Anchorage to Washington over the road, compared to four and a half days on a steamship."
Approximately 80 percent of the seafood that Carlile transports is frozen, with purveyors flash freezing it or delivering it on ice in totes. "We transport thousands of pounds of halibut, pollock, crab, and salmon, and there's not enough capacity in Alaska to take it all fresh," says Felix. "It also costs vastly more money to ship fresh salmon--it's at least two times more expensive."
Carlile's sister company, Northern Air Cargo, plays a bigger role in transporting fresh fish within the state before it makes its way to markets down south. "The catches from Bristol Bay as well as Norton Sound are put in fish totes, which are flown to Anchorage and typically picked up by customers like Copper River Seafood, Alaska General Seafood, E&E Seafood, Ocean Beauty Seafood, Trident Seafood, and more," says Northern Air Cargo General Manager Gideon Garcia. "From Anchorage, it makes its way south by other means."
Northern Air Cargo does not have chill or freeze on the aircraft, though it does have chill and freeze holding capabilities in its Anchorage warehouse.
There are advantages and disadvantages to each mode of transportation.
"Shipping vessels depart every Wednesday and Friday night from Tacoma to Anchorage, but Carlile's OTR service going either north or south has the capability to depart every day of the week, which offers a lot more flexibility," says Umatum. "When we get fresh fish in from Bristol Bay or Dutch Harbor, we can load the trailer at the dock and run down the highway. This gives us a real competitive advantage."
American Fast Freight (AFF), a subsidiary of Odyssey Logistics & Technology, provides services to grocery stores, distribution centers, and restaurants, among other customers who appreciate knowing exactly when a shipment will arrive. "Our clients like the predictability of a one-hour delivery window, knowing that they'll receive their shipment every Monday at 1 p.m.," says Craig Forbes, vice president of operations at AFF for Alaska, who adds that the majority of the cargo is transported on TOTE Maritime or Matson steamship lines. "This enables our customers to reduce inventory costs."
Lynden utilizes all modes of transportation to cover Alaska, including barge, ship, plane, and truck. Typically barge and ship services are used for frozen loads that are less time-sensitive, and a combination of ship, truck, or air is used for chill/fresh loads.
"Fresh fish can be flown to markets around the world, maintaining top quality, while products with fewer time restrictions can be moved more cost-effectively on the barge," says Hartmann.
And while keeping things cold in the summer months requires attentive care, it doesn't end there. "As Alaskans know, it can get cold up here. And during the winter months, sometimes the challenge isn't keeping products chilled but ensuring that they don't freeze when they shouldn't," says Hartmann. "This is appropriately called our 'keep from freezing' service."
"Though Lynden moves finished products ready for the grocery store, we also have specialty services for moving bulk commodities such as milk, wine, and fruit juices which have temperature control requirements," he adds. "The most important thing we do is work closely with our customers to fully understand their products and their businesses, so we can develop and provide transportation solutions that meet or exceed their needs."
Technology for Temperature Control
Lynden's Standard Freeze services move goods at -10[degrees]F, while Standard Chill Services will move at 34[degrees]F to 36[degrees]F depending on the time of the year. Full truckloads move at temperatures required by the customer.
"Temperatures can vary depending on the specific product; bananas, for example, often move at around 55[degrees]F, warmer than a typical chill load, in order to best maintain product quality," explains Hartmann, adding that the company typically moves more frozen loads than chilled loads.
These services require tight temperature control with small to minimum variances. Lynden combines its extensive refrigerated equipment fleet with state-of-the-art technology and monitoring tools to ensure exact temperatures are maintained throughout the entire life of the shipment. These standards are important to customers and to regulatory agencies such as the Food and Drug Administration.
"This is one of Lynden's real strengths, whether it be refrigerated semi-trailer equipment or refrigerated container equipment," says Hartmann. "We have the equipment that generates the most value for the customer or the biggest bang for the dollars spent."
Proper packaging is also a very important part of the process. Bags, boxes, and other containers may be used in combination with things like ice, gel packs, and insulation blankets, depending on the product and the shipping mode.
"It's important that good pallets and proper loading practices are used to help ensure a free flow of air, so the temperature is maintained consistently throughout the entire unit," Hartmann adds.
Because ship and barge services both require significant electric generation equipment to power the refrigeration units, the vessels are equipped with monitoring technology to ensure proper temperatures are maintained. "Air service typically does not provide any real type of temperature control, so goods needing the speed of air service need to be packaged in a way to self-maintain the needed temperature, such as fresh fish on ice in totes," adds Hartmann.
Carlile has its own specialized equipment, including customized refrigeration units. "Unlike our dry vans, the refrigerated units have a separate motorized refrigeration system on the nose of the trailer, as well as specialized curtains, skirting, and floors," says Felix. "These trucks are heavier than dry vans because they require more steel and aluminum to build them to our specifications, which include fully insulated walls designed to handle the rigors of ambient external temperatures."
Carlile's multimodal trailers can maintain different temperatures in a single trailer. "A single temperature trailer can regulate from 0[degrees]F to -20[degrees]F; a single temperature refrigerated trailer keeps products between 34[degrees]F and 44[degrees]F," says Umatum.
AFF runs numerous dual temperature and tri-temperature deliveries in Alaska, which allows them to deliver chill and frozen freight in a single trip. "We can transport dry, freeze, and chill all in one trailer, separating them with bulkheads and partitions to preserve different temperatures," says Forbes. "This allows us to deliver items more quickly and places less burden on the customer."
Because a consistent temperature is so important, AFF takes an added step. The company receives chilled and frozen items at its state-of-the-art facility in Fife, Washington, where items are unloaded into a specially designed, temperature-controlled environment. When the goods arrive in Anchorage, they are delivered via refrigerated containers to another temperature-controlled facility there.
"The products never leave a temperature-controlled environment, so the cold chain isn't broken." says Forbes, adding that AFF is the only freight forwarder in the industry with this capability. "With such a focus on food quality these days, we thought it was important to make this investment in infrastructure at our origin and destination points to protect food safety and our customers."
The Law of Supply and Demand
There are many factors that affect shipping costs, ranging from the time of year, to product shipped, to timeline, capacity, and volume.
"If a customer does a lot of volume in a given lane, they may be able to negotiate a discounted rate based on repeat, sustainable business volume," says Felix, giving the example of a large grocery retailer that moves more than 90 percent of its products from Washington to Alaska. "For an infrequent shipper, it's going to be more of a challenge to negotiate a discount because you pay more of a premium for inconsistency.
"The market is also driven by asset utilization; for example, how many trailers there are in the state at any given time," he adds. "During fishing season when they're harvesting salmon, it's a melee going southbound. The sheer volume of product coupled with a lack of transportation assets makes the price go up, and smaller competitors that are not necessarily asset-based sometimes have a hard time controlling services during the surge in summer months."
Whether going north or south, shippers who take on the challenge of Alaska's chill and frozen freight make it a priority to provide the fastest, most efficient mode of transport while preserving food safety.
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|Comment:||Cold Cargo: Expertise and careful planning are required to keep things exactly cold enough.(TRANSPORTATION)|
|Publication:||Alaska Business Monthly|
|Date:||Aug 1, 2019|
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