September 23, 2022

Chile undertakes public-private effort to solve ports crisis

Five key industry associations in Chile’s export and import sectors recently announced a collaborative public-private effort to address a logistics crisis in Chile that has resulted in increased costs and delays in shipments of sea ​​freight of foodstuffs and other goods.

A joint press release identified the relevant industry associations as the National Chamber of Commerce, the National Association of Consumers and Users (Conadecus), the Food Export Council, the Chilean Association of Fruit Exporters (ASOEX) and the Federation of Fruit Growers of Chile (Fedefruta), which, together with port logistics operators, “works with transporters, drivers and workers at the ports of Valparaíso and San Antonio”. Meetings had already been convened with the Chilean Ministry of Economy, Development and Tourism and the Ministry of Transport and Telecommunications.

According to Claudio Cilveti, president of the Food Export Council, Chile exports around $18 billion worth of food each year. About a quarter of this value in value is made up of fresh fruit. Chilean fresh fruit exporters rely on maritime transport to maintain cost competitiveness in export markets. However, with shipping times already stretching to weeks or more than a month for vital Northern Hemisphere markets, fresh fruit is particularly vulnerable to delays during the shipping process.

In May this year, the president of Fedefruta reference the 2021/22 Chilean fruit export season as one of the most complex in the past 25 years due to port congestion and other logistical issues.

While acknowledging that some of the issues such as high costs and delays stem from global factors such as the COVID-19 pandemic and the war in Ukraine, industry associations say there is still a lot of work to do. to undertake in Chile to try to ease the crisis:

The national solution to the problem is to take short and medium-term measures to improve the efficiency of Chilean ports, solve the shortage of workers throughout the supply chain and find a way to mitigate the rising shipping rates. , among other problems.

One of the measures envisaged is the authorization of the port of Ventanas to receive cargoes. Other measures include prioritizing food and strategic supplies in port operations, making rooming ships available at Valparaíso and Coquimbo terminals and ports in the eighth region, and changing restrictions of wave height in the port of San Antonio, which would facilitate the arrival and departure of more ships.

Chilean Economy Minister Nicolás Grau said that “there is ongoing coordination with the Ministry of Transport and Telecommunications to address these challenges ahead of the months of greatest demand between November 2022 and April 2023.” He added that “we are working to relaunch the Collaborative Logistics Plan for Foreign Trade (PLC)”, which involves the main industry associations and foresees “the participation of several actors throughout the supply chain”.

According to Ronald Bown, President of ASOEX, “The loss of fruit and the uncertainty generated by the inability to get the fruit to international customers on time are generating a crisis that is affecting Chile’s image as the world’s leading supplier. This seriously jeopardizes Chile’s place as the main producer-exporter of fresh fruit in the southern hemisphere and fifth in the world. Therefore, we seek urgent solutions from the joint efforts of the public and private sectors. We are off to a good start. We have all the right partners sitting at the table to resolve key issues, and we are confident that in the coming season we will return to pre-pandemic service levels.

Image: Luigi bosca at Wikimedia Commons, distributed under a CC BY-SA 3.0 Licence