Furthermore, it’s not just increased freight volumes from the Panama Canal expansion that ports and railroads are eyeing, says Yoshimura. When it comes to perishable goods imports from South America to the U.S., changes in sourcing and logistics strategies are also resulting in more freight volumes for Florida East Coast Railway, says Yoshimura.
“A lot more food retailers are starting to buy direct from farmers in South America instead of going through importers and brokers,” he says. “Traditionally, third parties in the U.S. or Latin America would book the freight from Latin America and use over-the-road trucking and local distribution to get the goods from the Port of Miami and Port Everglades up north. Increasingly, we’re seeing retailers take control of the supply chain, running direct container shipments from Latin America all the way north. Part of that strategy is to reduce costs and carbon emissions, as well as lead times, and rail plays a big part in that strategy.”
Another crucial development includes the South Florida Logistics Center, a 400-acre logistics complex that will be located adjacent to the Miami International Airport at the Hialeah Rail Yard Site.
Florida commercial real estate company Flagler is leading the project, and Florida East Coast Railway is partnering with them, says Yoshimura.
“We believe the project is going to drive consolidation in the market, from the mom and pop operations to the fragmented commodity dealers and brokers who offer various services, and put everything, including Customs, fumigation, distribution and fulfillment all under one roof.”
Developments in other key gateways
Bob Moran, CEO of Sataria Group, a 3PL and distribution firm, also sees a lot of potential for cold chain projects in Florida and elsewhere.
Discussions have already taken place with the Port of Oakland (California) and Port Manatee (on Florida’s Gulf Coast), to build refrigerated facilities on port property, he says, which would target floral imports, in particular. Another project in the works includes a plan to build a perishable distribution center at Chicago’s O’Hare airport.
The O’Hare project would provide a Midwest gateway for air imports of floral products from the Netherlands and Latin America, says Moran.
And, like the executives of Florida East Coast Railway, Moran is also an advocate of on-dock rail.
“If you’re going to put a facility on the port, you had better make it rail served, and you’d better make sure it has easy access to air freight,” he emphasizes.
Moran is a proponent of using rail for freight, and acknowledges the great strides the industry has made in recent years to improve service.
“In large part, that’s because railroads started to work closer with ports. The combination of the two creates a lot of synergy.”
The role of railroads in the cold chain is only going to become more significant as better technology coupled with driver shortages in the trucking sector push more freight to railroads, adds Moran.
“Better rail cars and tracking technology, improvements in refrigeration technology, and more efficient reefer units are making it possible for shippers to move perishables on rail with confidence,” he says.