The CEO of the Citrus Growers Association (CGA), Justin Chadwick’s recently published his weekly update, and Mark Cairns, Head of Cold Chain for Maersk Africa, had something to say about claims that were made. His statement is as follows:
"There is much that is encouraging in the content by Chadwick, which summarises the results of the CGA’s two-day strategic planning session. The CGA update outlines nine projects aimed at helping citrus growers to overcome some of their challenges. The projects range from improving port efficiency, investment in road and rail infrastructure and building better relations with stakeholders.
However, when discussing one particular “project” in the plan – the shipping industry – the CGA singles out shipping lines, asserting that they “destroy” citrus growers’ businesses and warning that more businesses will fail next year. Speaking only for Maersk, not for the shipping industry, we believe this claim is erroneous and unfair.
Getting oranges from a farm in South Africa onto a supermarket shelf in Europe currently involves multiple stakeholders and relies upon many interdependencies. The shipping industry is a key enabler in helping South African growers and exporters get their fruit onto shelves in supermarkets abroad. Given the multiple stakeholders and interdependencies, and that there are nine projects in the CGA plan – not one – how then can one player, the shipping industry, be responsible for the failure of a citrus grower’s business?
Like any of our customers, Maersk is subject to external conditions and shocks that impact our business. Such shocks sometimes curtail the service levels we are able to provide our customers and affect our freight rates. When there is a global pandemic, congestion, a strike at a port, floods or riots – all of which we have seen over the past few years – we at Maersk try our very best to minimise the disruption for our customers and their supply chains. While we do this, we also need to maintain our business and remain competitive. What is important is that we have open and constructive dialogue with our customers and the industry associations that represent them, on how we can best serve their businesses within the external reality and the constraints that affect us all.
As the CGA specifically calls out freight rates, equipment availability and scheduling as having had a “devastating” impact on supply chains since 2021, I would like to provide some context on each of these. As in any other industry, supply and demand drives prices. The pandemic prompted the global supply chain crisis. Some of the impact of this on Maersk was having to deal with severe port congestion. The result of this on our equipment, including vessels and containers, was that these resources were physically not where we needed them to be, and these challenges in turn affected scheduling. Despite these shocks and challenges, our focus remained on reliable cargo delivery for our customers. As Maersk we maintained our overall capacity in the South African market across our services.
The pandemic underscored the importance of building supply chain resilience and Maersk is focusing on the ways in which we can achieve this for our customers. Consequently, we are on a journey to becoming a leading integrated, end-to-end logistics company. We focus on new ways of providing logistics services to make our customers more resilient to external shocks. Far from negatively impacting our customers and their businesses, Maersk has addressed the challenges and pitfalls in logistics that contributed to the global supply chain crisis. We have invested heavily in technology and created new digital platforms. Our integrated end-to-end logistics offering gives our customers more visibility. It removes touchpoints and complexities in their supply chains, which in turn reduces cost. Around the world, partnership with our customers is the cornerstone of our operations. Maersk wants to work with our customers – and their industry associations – not only to build more resilience in their supply chains, but to explore the ways in which integrated logistics can unlock growth for their businesses.
We will continue to develop partnerships with clients, and I look forward to developing a partnership with the CGA that will help our customers and their businesses to become more competitive and achieve growth through optimising their supply chains."
Mark Cairns is the Head of Cold Chain for A.P. Moller - Maersk’s Africa Region
For more information:
A.P. Moller - Maersk
Tel: +27 82 889 1518
Email: bonita.dordel@maersk.com
www.maersk.com