Could empty China-bound trains be loaded with European fresh produce?
As demand for high quality fresh European produce continues to grow in China, one Netherlands-based Wageningen UR researcher is investigating the possibility of tapping into an existing rail route that could transform the cold supply chain between Rotterdam and the sprawling Chinese municipality of Chongqing. Research lead, Xiaoyong Zhang gives www.freshfruitportal.com. the lowdown.
European exports of fresh fruit and vegetables could be on the brink of a new frontier, with plans underway to utilize a rail route that crosses seven countries before reaching China.
Around a year ago Zhang was invited to attend the opening ceremony of the YuXinOu Railway between Rotterdam and Chongqing, where she learned how goods were transported along 11,000km of rail networks as part of a Trans-Eurasia network.
Trains packed with mainly laptops and other electrical items are now regularly transported from China to Europe along this route.
One important aspect struck her; the train was often empty or partially empty on the eastbound return journey along the route called the New Silk Road.
"I started thinking, what if we could make better use of this existing rail route that already connects the Netherlands, and parts of mainland Europe, with China," Zhang tells www.freshfruitportal.com.
"It seemed to me the train, that is often completely empty or not entirely full up, when it goes back to China, is not being used effectively as it could be and this presents an opportunity.
"So I started a research project and a few weeks ago I presented my results as part of a trade delegation in China, with the King of Holland, Willem-Alexander, and other dignitaries in attendance. It was attended by more than 200 CEOs and organizations. It's a real wake-up call for the agri-business industries."
Compared with sea shipping, the train is between 30-40 days faster and could pick up other produce en route as it takes in countries such as Germany, Poland, Belarus, Russia and Kazakhstan before reaching China.
The train journey would also be around five times cheaper than airfreight with current flight times approximately nine to ten hours.
Chinese consumers want European fresh produce
While there is no doubt Chinese consumers desire fresh European imports, says Zhang, much more work would be needed to handle and store the perishables during transportation, combined with improvements in the domestic cold chain infrastructure once produce arrives in China.
Zhang says perishable produce would obviously need reefer container storage to maintain temperature and quality, but this is an easy fix.
"Fitting the trains with reefer containers is one aspect which would be quite straightforward - another is getting all of the other infrastructure in place properly so fresh produce imports can be handled properly all the way along the supply chain.
"European produce, particularly Dutch fruit, vegetables and flowers, are in high demand amongst Chinese consumers. It got me thinking that the Netherlands has so much fruit and vegetables and agri products in general and with the Russian import ban, why not start using this empty train to supply China?
"Products from the Netherlands have a very high reputation in terms of quality and a good image amongst Chinese consumers."
As part of Zhang's presentation, she also described how the next steps are for government and private investments in the agri business sector, who should be looking into securing eastbound cargoes. She points towards 'massive opportunities' in the Netherlands, the second largest agri product exporter in the world ($84.5 billion worth of agri products exported by the Netherlands in 2014).
The fact that Chinese consumers rate Dutch produce highly (particularly cherries, pears, blueberries, sweet peppers and tomatoes), and currently less than 1% of China’s imported agri products are from the Netherlands, signal the train connection could be very a profitable reality.
"I got some very positive feedback and some interesting questions have been raised. Various agri business sectors have not, until now, realized the potential of this opportunity, but I hope that is now starting to change.
"People seem very interested in the idea of transporting Dutch produce to China using this route as it makes economic sense and would be a wise move.
"Someone has to make a move and I hope it will be the Dutch. The real question is, 'Can the Netherlands afford to lose this market?'"