Latin American exporters of perishable products are feeling the squeeze as higher jet fuel costs drive up the price of the expedited service prized for their goods. So much so that exporters of fresh flowers, fish, fruits and vegetables could be priced out of the market for air cargo, airline executives say.
"Sixty-five percent of the exports coming from Latin America are perishables," says Tom O'Malley, UPS vice president of air cargo for Latin America. "How long will exporters of low-value perishable goods be able to sustain the high prices (for air cargo service) due to the high cost of fuel? It's a big concern."
Says Des Vertannes, executive vice president, cargo, of Abu Dhabi-based Etihad Airways: "We're all into consuming fresh, organic food."
But some Latin American exporters of perishables are struggling to help airlines cover the ever-increasing price of jet fuel.
The fuel cost problem is compounded in Latin American countries and puts foreign carriers at an official disadvantage, says Peter Scholten, vice president and general manager of the Americas for Martinair. "There are countries in Latin America where the local carriers get subsidized fuel," Scholten says, so "there is not always a level playing field."
Because of "the high cost of fuel--we think we are coming close to perhaps pricing certain perishable products out of the market," says Robert Rozek, global director of perishables for Martinair and its Colombia-based subsidiary airline, Tampa.
Source: Air Cargo World, http://www.aircargoworld.com