Brazil’s Famosa to start using reefer vessels to export

Aug, 02, 2022 Posted by Gabriel Malheiros

Week 202231

In times of logistical obstacles marked by the pandemic and the war in Ukraine, Brazil’s fruit export company Agrícola Famosa decided to spend a few extra million dollars to guarantee the delivery of its melons and watermelons in Europe. The country’s largest fruit exporter inked a contract with GreenSea, a joint venture between Seatrade and Green Reefers in reefer vessels chartering, to transport its products beginning in August when the harvest begins.

Please find below the track record of melon exports from Brazil in the period between January 2021 and June 2022. The data is from DataLiner.

Melon exports | Jan 2021 – Jun 22 | TEUs

Source: DataLiner (click here to request a demo)

The arrangement will boost Famosa’s transportation expenses by roughly 30%, but it will ensure that the fruits are delivered on time and in excellent shape to clients. “We took this risky and costly action to guarantee supply to our European consumers. We took this move because of all the logistical issues we had last season,” explains Carlo Porro, the company’s CEO and commercial director. The contract’s exact value was not disclosed, but according to the executive, “it does not reach double digits.”

According to Porro, due to transportation delays last year, the fruit received discounts for reaching customers with a reduction in quality, a situation that should not occur this year. GreenSea’s first one of a set of reefer vessels is expected to sail from Fortaleza, where Famosa’s farm is based, during “week 35” of the regular calendar year, between August 29 and September 4. The service will be provided weekly until “week 8” of 2023.

The contract calls for six ships to circulate between Fortaleza and the ports of Vigo (Spain), Dover (England), and Rotterdam (Holland).

Changes and continuation

According to Porro, GreenSea will take between 30% and 35% of Famosa’s total exports. The rest, about 250 containers a week, will continue to be shipped to Europe by CMA CGM, with which Famosa has had contracts for 25 years and has no complaints.

Agrícola Famosa owns 30,000 hectares in the country’s Northeast region, 10,000 of which are arable, and produces around 200,000 tons of fruit per harvest. Last year, the company earned BRL 920 million, above Porro’s initial expectations, who expected around BRL 820 million and BRL 720 million for 2020.

In addition, Melon&Co, a company created by Famosa in August last year to operate in the United Kingdom, earned 50 million pounds (about R$315 million) in its first year of activity. This company sells fruits from Brazil, Central America, and Spain.

The expectation for the 2022/23 crop is a good production and high profitability due to the favorable climate in Brazil’s Northeast and the European heat. “The strong heat in Europe should bring the region’s harvest to the end of August, precisely when we arrive in the continent with Brazilian products. In addition, the hot climate encourages increased consumption of refreshing fruits such as melon and watermelon,” says Porro.

Source: Valor Econômico

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