Temperature-controlled Logistics: Cool Under Pressure
As demand for perishable products grows worldwide, efficient and effective cold chain management requires strong partnerships and quick reactions.
Shippers have been managing the challenge of transporting temperature-sensitive goods since the 1700s, when British fishermen began using ice to preserve their catch while at sea. Today, the global market for cold chain products is expanding rapidly.
Developing countries are driving some of the growth. "Even with the economic downturn, overall quality of life is improving globally," says Curtis Foltz, executive director of the Georgia Ports Authority. "People with more economic means are more likely to consume vegetables, fruits, and protein-based products, creating higher demand for these products worldwide."
Correctly maintaining the temperature of perishable products is necessary to preserve quality and safety from the point of harvest or manufacture through the supply chain to the consumer. For food products, failing to maintain proper shipment temperature can result in textural degradation, discoloring, bruising, and microbial growth.
Each step along the cold chain requires special care to ensure product quality and optimize shelf life.
"In the past 10 to 15 years, cold chain practices have improved," says Doug Stoiber, vice president of produce transportation operations for L&M Transportation Services Inc., a Raleigh, N.C.-based third-party logistics (3PL) provider specializing in produce. "For example, before refrigerated docks were common, produce often sat in the summer heat while waiting to be moved to a cold warehouse. Today, more docks are refrigerated.
"Some changes in cold chain processes have been mandated, and some are voluntary," he notes.
Different products require different temperature-level maintenance, but staying within proper temperatures is vital to the integrity of many shipments along the supply chain.
"In the past, fresh produce was often combined with dry and frozen products, which did not allow any of the products to be shipped under optimal temperatures," says Stoiber. "Today, shippers separate loads to make sure all products are transported at the right temperature."
Public Health Concerns
Temperature management throughout the food distribution process also helps reduce foodborne illnesses.
"Maintaining the cold chain is one of the most effective ways to ensure safe, quality food," says Jorge Hernandez, senior vice president of food safety and quality assurance at U.S. Foods. The Rosemont, Ill.-based distributor offers more than 350,000 national brand products, and its own private label items ranging from meats to produce to frozen foods.
The 2011 Food Safety Modernization Act authorizes the U.S. Food and Drug Administration to establish safety standards for food transportation. The agency is still developing those standards, however, and in the meantime, suppliers and distributors are responsible for managing themselves.
U.S. Foods, for example, takes detailed steps—ranging from cold storage in trucks to food safety training for all employees—to help prevent contamination during transport, and encourages other distributors to adopt verifiably safe transportation practices.
While the U.S. focus on cold chain safety is continuously evolving, some developing countries are not yet keeping pace. The United States imports about 30 percent of its fruits and vegetables, and foods imported from less mature markets—where access to refrigerated trucks may be limited, for instance—can present a challenge. For this reason, a holistic view of the cold chain is vital.
"Complete visibility and traceability is incredibly important in case of recalls," says Don Schoenl, president and chief executive officer of Nordic Cold Storage, an Atlanta-based warehouse operator specializing in cold storage and distribution services to food producers, distributors, and retailers. "Our ability to track a product from production or harvest all the way to consumption is critical for ensuring quality."
Technology plays a significant role in enabling cold chain traceability and data exchange. The new generation of reefers is equipped with an array of sensors to help improve temperature-control reliability and monitoring.
"Many containers today are equipped with devices—akin to the black boxes in airplanes—that track all cargo movements and temperature," says Rick Sharp, vice president at Seaonus LLC, a Jacksonville, Fla.-based 3PL that operates a cold storage facility providing 8.2 million cubic feet of racked, refrigerated, or frozen storage. "Any variables are cause for concern."
On the Record
U.S. Foods employs a variety of thermometers and time-temperature recorders in distribution vehicles to gather data that can be merged with GPS and IT systems to not only regulate product temperature in transit, but also manage the cold chain during loading, unloading, and delivery.
That technology alone, however, is not sufficient to protect the cold chain. Human judgment is often required, as well. For example, alarms on U.S. Foods’ sensors trigger if temperatures move outside a specified range during transport. When the company first implemented the sensors, it was overwhelmed by the number of alarms that sounded.
"The sensors were picking up the air temperature when the doors were opened, for example," says Hernandez. "For a while, we’d have the driver stop and check the inventory each time we got an alarm, which quickly became time-consuming and expensive. We later realized that an alarm didn’t always mean the product was compromised."
Fortunately, the company devised improved ways to utilize sensors, so alarms sound only when there is an actual product issue.
"With 22,000 trucks running, technology becomes a key tool in operating efficiently," says Hernandez. "But technology won’t make the critical decisions on product issues. You still need someone to make those judgment calls."
Key Considerations and Best Practices
Because cold chain logistics requires maintaining temperature integrity, controlling all the processes involved means high levels of integration and coordination. Each supply chain partner—from harvester or producer to the ultimate seller—shares responsibility.
For example, cold chain transportation units are commonly designed to keep ambient temperature constant, but not to bring a shipment to the optimal temperature. But if a shipment is not adequately prepared and conditioned, its quality may be compromised.
Further, if a shipment will be exposed to extreme cold or heat along the transport route, considerations should be made to protect the products in transit. Transportation that extends over multiple days provides a host of opportunities for breaking the cold chain.
"Route selection is important in order to maximize cold chain performance, especially in winter and summer," says Hernandez. "In extreme temperatures, companies should select routes that minimize the number of times doors must be opened.
"A lot of monitoring and management goes into handling cold chain shipments," he continues. "Knowing about extreme weather conditions in advance helps optimize equipment use and better protect products."
Contingency planning is also important. If a truck breaks down, or a refrigeration unit stops working, the carrier or 3PL must be ready to respond. Even with the best systems and monitoring technology, an unplanned delay or rerouting could potentially jeopardize shipment stability. Shippers should work with their transportation partners to develop contingency plans that clearly map out a strategy in the event of a delay.
Checks and Balances
If problems or anomalies that compromise a shipment occur in transit, all trading partners must act to identify the source and find corrective actions. Manufacturers, 3PLs, and carriers should all have checklists for documenting procedures for every step of the delivery process, because a solid system of checks and balances can help reduce the risks.
"Shippers have to double-check the work of their supply chain partners, and understand the processes they put the product through," says Stoiber. "When the shipper hands a product off, for example, it is up to the transportation provider to ensure the product has been handled at the proper temperatures. The use of checks and balances for all partners helps ensure the cold chain hasn’t been disrupted along the way."
The final transfer of a shipment into the storage facility presents another potential integrity breach. Key considerations when arranging final product delivery include not only the destination, but also timing. If the warehouse stages too early or too late, product temperature can stray outside the appropriate range. Warehouse employees should also be familiar with the product and the best way to handle it.
"When a product is stripped and taken into cold storage, it loses integrity at that point," says Sharp. "It is then up to the warehouse facility and managers to ensure they handle the shipment properly. Education and training are very important."
While customers will dictate some product storage and handling conditions, equipping warehouse workers with specific product knowledge is a best practice.
"Several factors are important to ensure integrity of the cold chain once a shipment arrives at the warehouse," says Lowell Randel, director of government affairs for Global Cold Chain Alliance, an Alexandria, Va.-based organization that acts as a platform for communication, networking, and education for each link of the cold chain.
"For example, what is the temperature requirement for each product?" he continues. "How long can it stay frozen and still maintain quality? What is the best way to store it? Does it contain allergens that require other products are not placed next to it?"
Everyone involved must be dedicated to handling the products appropriately, monitoring the equipment, and ensuring proper storage. "Unlike dry goods that do not require further concern until they are shipped, refrigerated products require 24/7 attention," says Foltz.
Hernandez recommends shippers be very clear about product expectations before a carrier or 3PL accepts the shipment. U.S. Foods devised an expectations manual that specifies its requirements in areas ranging from time and temperature control to cleanliness.
"We also use technology while shipments are in transit, so we can check these stipulations automatically," he says. "We then load the data on our Web site so it can be monitored remotely. These steps allow us to react to issues before spoilage and waste occurs."
Preparing for Problems
If product spoilage does occur, the companies involved should have agreements in place to establish responsibility for damage.
"The end customer often determines whether there has been a breach, and whether they will accept the product with conditions," says Stoiber. "Supply chain partners should also agree on how to dispose of a product if a problem occurs."
Many ports now have U.S. Department of Agriculture inspection facilities onsite to address concerns about food shipment temperature, quality, or conditions, which can be especially important for companies shipping a large volume of meat or poultry. Trucks or containers arriving at facilities without inspection capabilities onsite may be held until an inspector is available, or the receiving company may choose to accept a load on condition.
"One seafood customer has its own room set up to collect samples for testing when seafood shipments arrive at our facility," says Sharp. "Because the customer does its own testing and inspections as the products come in, the process runs faster and more smoothly."
If freight crosses international borders, knowledge of customs procedures can become very important because cold chain shipments tend to be time-sensitive and more subject to inspection than regular freight. Understanding local rules, customs, and environmental conditions—as well as estimating the length and time of a distribution route—are important factors in global cold chain shipments.
"Knowing the export and import requirements and regulations is critical," says Randel.
"Cold chain management is challenging," says Hernandez. "Shippers have to view it through a lens of food safety and quality. They must constantly review how they can improve processes, and whether they have the right practices in place throughout the supply chain.
"Consumers must know that, no matter where a product came from, it complies with food safety and regulatory requirements," he adds. "This is not the place to take shortcuts."
Guarding Against Vulnerabilities
The entire cold chain process should be about minimizing the time it takes to move a product through the system. "Efficiency is key," says Randel. "Vulnerabilities occur if there are delays in handing product off from one facility or stage to another."
"To manage cold chain shipments well, all parties must foster a strong partnership," adds Stoiber. "Everyone needs a good working knowledge of best practices for cold chain handling and transportation. Food products have to move as fast as possible to give consumers the most valuable, nutritious, wholesome product, with as much shelf life as possible."
Increased globalization and demand for perishable goods are driving significant cold chain market growth. The tasks involved in handling and transporting perishable products, as well as the energy required for refrigeration, make cold chain operations expensive. As the market grows, companies that understand cold chain distribution, and utilize best practices to improve efficiencies and reduce spoilage, stand to gain the most.
Ports Hot to Handle Cold Chain Growth
With reefer exports and imports both on the rise, ports throughout the nation are gearing up to handle additional loads.
“Some companies that were looking to expand or upgrade at ports a few years ago put plans on hold during the global economic downturn,” says Lowell Randel of the Global Cold Chain Alliance. “Today, in anticipation of growth, many are going forward with plans to open additional facilities or update existing ones.”
For example, the Port of Miami, already a major gateway for perishable imports from South America, and the gateway for one-third of total U.S./Latin American trade, expects additional significant growth once the Panama Canal expansion is completed.
Meanwhile, warehousing provider Nordic Cold Storage is expanding operations at the Port of Savannah, Ga., the second-busiest U.S. container port for the export of American goods by tonnage in fiscal 2011. The port handles nearly 40 percent of the nation’s containerized poultry exports, supplied largely by Georgia’s farms.
Nordic recently opened a new convertible temperature-controlled storage and blast (quick freeze) facility expected to give shippers more cost-effective options for moving refrigerated commodities to and from international markets.
The new site features more than 200,000 square feet of convertible temperature-controlled storage space, and is capable of blasting more than 10 million pounds of product per week, ranging from fresh poultry to produce. The $30-million facility currently employs 150 workers, but Nordic plans to start a second phase by the end of 2013.
“Right now, we have more demand for refrigerated warehousing than we have facilities,” says Curtis Foltz, executive director of the Georgia Ports Authority. “The cold chain works best when you have a balance of imports and exports, and this new facility will be great for both. That balance helps allow producers to be competitive and provide their products cost effectively.”
The new cold storage warehouse began receiving its first shipments in April 2013.