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Fruit and vegetable transport is once again facing high costs and increased concentration.

Fruit and vegetable transport in Spain is being affected by the unstoppable rise in costs, an inflationary scenario that everything indicates will continue throughout the year. Despite the difficulties, the market wants to continue to deepen its digitization and improve sustainability, while increasing concentration and purchasing operations to form large fleets with which to respond to stable demand for services.

15 Jul 2022

Alimarket Gran Consumo

The threat of uncertainty is once again hanging over the fruit and vegetable transport market. If the 2021 financial year was marked by a return to a certain normalization in terms of traffic and its forecast, this 2022 has started with an unprecedented increase in all costs and a new narrowing of margins. While costs rose by 9.6% for refrigerated vehicles up to January 2022, the average freight price for journeys of more than 300 km, the most frequent in the sector, stagnated at 150.4 €/km, just 0.9% more than in 2020, according to data from the Ministry of Transport, Mobility and Urban Agenda. This suffocating situation is compounded by the traditional lack of drivers at European level, with a deficit of 15,000 drivers for the national market, and the current bottlenecks in the supply chain, two additional situations that will require a redesign of the current business models and services provided in order to recover, as soon as possible, the situation of equilibrium.

In this already complicated scenario, the process of company concentration has also intensified, with a recent avalanche of acquisitions. This is the case of the purchase of the Alicante company Explotación Internacional de Transportes (Exit) by the Murcia company ESP Solutions (A.T. La Espada); or of the Murcia company Eurosol Cargo by the Navarra company Transportes Cruz. An industrial transformation that, in addition to a diversification of destinations, pick-up areas or transported goods, is shaping larger and larger fleets in response to the current difficulties in outsourcing traffic to other subcontracted carriers. "The sector is still a highly competitive area, although significant cost increases and the lack of drivers may change this situation. Competition will probably be less on price and more on capacity and performance," says the leader, Primafrio.

In fact, the search for new ways to continue expanding the business has also led Primafrio to open its capital to the American investment fund manager Apollo, which acquired 49% of the shares in March. The operation will help the company to accelerate its strategic plans, including investment in its infrastructure network and further international expansion, after having opened its first overseas operation, specifically in Portugal. Its founders, Executive Chairman Juan Conesa and CEO José Esteban Conesa, will remain majority shareholders and will continue to lead the growth of the company, which, in 2021, recorded a turnover of more than €500 million (+10.5%). Meanwhile, the market remained at an increase of 4.6% during the same period, with revenues close to €2.2 billion, according to data collected by Alimarket Logística. Planned investments in the expansion and opening of new facilities are also growing, especially those dedicated to groupage, which, in recent years, has become a perfect ally when it comes to better adjusting the cost of transport for customers compared to the cost of services. In total, around fifteen facilities will open their doors between 2021 and 2023.

Focus on digitalization and sustainability

Be that as it may, the specialists in fruit and vegetable transport also do not want to miss the opportunity to accompany the national field in its future development and, for this reason, they continue to go into digitization and improved sustainability to respond to customer demands. In the first field, initiatives such as 'Prima Long Life' have been launched, a system oriented to the creation of controlled atmospheres in trucks "capable of carrying products that require different temperatures, humidity, oxygen or CO2 levels in the same trip", explained Primafrio. It has also seen the light of day the API ecosystem 'Project44', which performs predictive analysis based on IoT and facilitates the communication of data to the entire supply chain, from the El Mosca group; or Trucksters, a startup with software based on Artificial Intelligence and Big Data, which offers road freight transport systems based on this technology and the use of relays in driving.

The other growing trend is the environmental commitment of the sector and, here, tests have multiplied with new less polluting vehicles such as megatrailers or plug-in hybrid trucks, by the hand of Acotral; electric distribution units and long-distance vehicles with hydrogen cells, for which Agustín Fuentes e Hijos is betting; and, finally, LNG tractors, which have been acquired by the companies Caudete, El Mosca and Caliche. Similarly, many others are betting on getting on the train and thus reducing their emissions, with the Alicante group Perea, Hermanos Mazo and Primafrio as great standard-bearers. The latter, together with the Caliche group, has embarked on the new weekly sea route in ropax ships between the port of Cartagena (Murcia) and the French town of Toulon, which makes it possible to optimize travel time by up to 15%.