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Dive Brief:
Freight forwarders are working with shippers to strategize how to manage a shifting air cargo market landscape as peak season approaches, Xeneta’s Chief Airfreight Officer Niall van de Wouw said in a Sept. 5 report.
E-commerce volumes remain a major market indicator, with exported goods from China already up 30% this year, Xeneta reported. In July alone, there were reportedly 37 million downloads of the Temu app.
Van de Wouw said that shippers should be “nervous” for Q4. “We expect to see a seller’s market out of Asia and across the Atlantic due to the latter’s reduction in winter capacity. We’ve had a hot summer, and we may have an even hotter autumn ahead.”
Dive Insight:
The average air cargo spot rate reached its largest year-over-year growth of 24% to $2.68 per kilogram, Xeneta reported.
On a corridor level, rates on shipments bound for North America saw the largest monthly increase from July — which is typically regarded as the industry’s “slack season.”
Rates from Europe to North America, for instance, were up 7% month over month to $1.77 per kilogram in August, possibly due to the “surging transshipments originating from Asia,” according to the report. Meanwhile, Southeast and Northeast to North America rates were up 6% MoM and 4% MoM to $6.15 per kilogram and $4.68 per kilogram, respectively.
August air freight by the numbers
11%
YoY percentage increase in global air cargo demand
$2.68
The average spot rate per kilogram
30%
YoY growth of e-commerce and low-value shipments from China to the U.S. in the first seven months of the year
58%
The global dynamic load factor, which measures the volume and weight of cargo flown, as well as available capacity
While rates benefited from ongoing balance in supply and demand, global air cargo demand was impacted by the modal shift from ocean to air due to Red Sea disruptions in addition to strong e-commerce growth, per the report. In August, cargo demand was up 11% YoY.
“Rates we saw bottoming out in late July started picking up again in mid-August. This is too short a period to call a season,” said van de Wouw. “This has been a busy summer, and now we’re at the threshold of Q4, it will be interesting to see what will happen and if all the anticipation of a red hot peak season materialises.”
As preparations for peak season unfold, some companies announced surcharges as shippers and freight forwarders look to secure capacity. DHL Express, for instance, plans to implement surcharges starting Sept. 15, and van de Wouw speculated whether “the peak surcharges some carriers plan to implement will hold.
Other companies are creating more market capacity, including freight forwarder Dimerco Express Group which is launching a new weekly air freight charter service on Sept. 15 between Shanghai and Chicago. CMA CGM Air Cargo, meanwhile, recently launched its first Transpacific connection connecting Hong Kong and Chicago.
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In this installment of the ‘Agronometrics In Charts’ series, we look at the growth in Peruvian blueberry exports. Each week the series looks at a different horticultural commodity, focusing on a specific origin or topic visualizing the market factors that are driving change.
So far in 2024, the global industry has experienced growing uncertainty due to the slowdown in export volumes from Peru. Since the impact of the El Niño phenomenon in 2023, current climate issues and the drought in the northern part of the country have contributed to export volumes not surpassing last year’s levels up until week 34, resulting in a sluggish season.
However, week 35 marked a turning point in this trend, indicating the beginning of a recovery for the 2024 season. A shift in the slope of the export curve is expected, with peak volumes projected for weeks 43 to 46. This marks a significant recovery from earlier in the season and suggests that export volumes are now aligning with the projections made by Proarandanos for the 2024/25 campaign, which stand at 293,841 tons, a 27.67% increase compared to the 2023 export of 230,153 tons of fresh blueberries.”
Peru Fresh Export Volume By Partner | Cultivated Conventional
It is also important to highlight that prices in USD/Kg have remained high and continue to rise compared to previous seasons. However, it is unlikely they will reach the levels seen in 2023, which were inflated by the significant drop in export volumes due to the effects of El Niño. The global industry’s attention remains focused on Peru’s indicators, as the country continues to lead the world in exports.
Banning the use of foreign biofuel feedstocks such as used cooking oil for a new tax credit could result in retaliation against U.S. farm exports, Agriculture Secretary Tom Vilsack said Tuesday.
The Treasury Department is under pressure from some lawmakers to limit eligibility for the new 45Z clean fuels tax incentive to fuels made from feedstocks sourced in the United States. The 45Z credit, which was created by the Inflation Reduction Act, takes effect in 2025.
“It’s a tough issue, because if you essentially create some kind of significant restriction in the effort of trying to protect commodities and items that are grown and raised here, you essentially invite the entire world to do the same thing,” Vilsack told members of Growth Energy, an ethanol industry group.
“So, when we try to export corn, or we try to export soybeans, or we try to export pork, or we try to export poultry or beef or whatever, or ethanol, other countries go, ‘Wait a minute. They’re restricting this over here to protect their industry. Okay? We’ll do the same.’”
In a letter to the Treasury Department last week, more than 40 lawmakers said the Biden administration should make it clear that the 45Z credit would only apply to biofuels produced from domestic feedstocks. The lawmakers say that state and federal policies are driving demand for used cooking oil and tallow sourced overseas.
The National Oilseed Processors Association and the American Soybean Association support the lawmakers’ request.
While warning against restrictions on foreign feedstocks, Vilsack said it was important to guard against fraudulent imports that are reported as used cooking oil but are actually palm oil.
Vilsack said the administration is working to issue regulations for the 45Z tax credit before Biden leaves office Jan. 20.
“There’s just a genuine effort and interest on behalf of the administration to get this done done before Jan. 20, and it’s on the top of my list,” he said. “So, everybody knows I’m very interested in this at the department.”
The value of the 45Z credit will vary depending on the carbon intensity of the biofuel. USDA has been providing input to Treasury on the agricultural practices that can lower the carbon score of feedstocks such as corn and soybeans.
Farm groups have complained that Treasury’s guidance for a temporary tax credit for sustainable aviation fuel is too restrictive.
This collaboration had overseen the safety review of hundreds of feed and pet food ingredients, allowing them to enter the market under a memorandum of understanding (MOU).
Due to several factors, the FDA is no longer able to maintain this partnership, prompting the need for a new system.
Although the American Feed Industry Association (AFIA) expressed disappointment over the dissolution of the relationship, it welcomed the FDA’s release of draft guidance outlining the transition.
Key Changes:
What’s ending?
The AAFCO ingredient review process, where the FDA acted as the safety reviewer, will cease. The FDA’s Food Additive Petition and Generally Recognized as Safe (GRAS) notification processes will remain unchanged.
What’s replacing it?
The FDA proposes a new system, the Animal Food Ingredient Consultation (AFIC), to replace the AAFCO review process. This consultation-based process is detailed in the FDA’s draft guidance (Industry 294) and is designed as an interim solution for companies developing new feed ingredients that would have otherwise used the AAFCO process.
What about previously reviewed ingredients?
The FDA has outlined in its draft guidance (Industry 293) that it will continue to exercise enforcement discretion for ingredients listed in the 2024 edition of the AAFCO Official Publication. These ingredients can continue to be marketed in interstate commerce, provided they meet safety standards.
What happens to AAFCO?
AAFCO’s current ingredient review process will end on October 1. However, AAFCO is exploring a new system for scientific review and approval of ingredients, potentially incorporating approvals from the Canadian Food Inspection Agency (CFIA) and the European Food Safety Authority (EFSA).
AFIA’s position:
The AFIA has submitted feedback to the FDA, advocating for clearer guidance in the draft documents (Industry 293 and 294) and establishing clear expectations for both ingredient submitters and the FDA.
Specifically, the AFIA wants to ensure that any ingredient previously reviewed under AAFCO can transition seamlessly to the new AFIC process. It also urged the FDA to accept future editions of the AAFCO Official Publication, which would include ingredients reviewed under the MOU but not yet published. This, it argues, would provide a clear pathway for ingredients still under review.
And the trade group urges the FDA to finalize these guidance documents swiftly so that the industry can continue delivering innovative solutions for both animal agriculture and companion animal markets, domestically and internationally.
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Target didn’t always play music, and Georganne Bender remembers the day that changed at her local store when it reopened following a remodel.
When the music came on, “it was night and day. It was a more comfortable feeling. … It changed the atmosphere,” she said.
A retail store without music is like a scary movie with the music turned off, said Bender, who is a retail consultant: “It doesn’t feel as good or as scary or as impactful.”
Music might be in the background in grocery stores, but it’s far from an afterthought. The music and messaging customers hear are part of how groceries establish and solidify their brands and encourage sales, sources said. With increasing interest in retail media, grocers are figuring out how to add in-store messaging to the mix.
Customers have high expectations for in-store audio. The best playlists are even getting attention on social media, where influencers say grocery stores are the hottest club in town, with only a hint of irony. Or show up on Spotify or YouTube, where customers upload playlists from local supermarkets.
Sources weighed in on how grocers can select the right music for customers and determine the appropriate mix of marketing and music.
The perfect playlist
Music can help set the tone for a shopping experience, grocers say, and the playlist should change based on who your audience is and the vibe of the store.
Customers at Heritage Grocers Group stores hear music based on what’s popular in that region and with the grocers’ mainly Hispanic customers. The group’s store banners include Tony’s Fresh Market and Cardenas Markets.
“Although we’re 115 locations, we do believe in that whole local approach,” said Adam Salgado, Heritage’s CMO. “Our customers, although mostly Hispanic, they vary by location and region. So perhaps in Nevada, where there’s more of a Central American and Caribbean presence, there’s a little more salsa and more Merengue playlists.”
“If you look at the heart of NorCal, where there’s the farm growers and the pickers, et cetera, that’s more regional Mexican music, so you may go in, and you may be hearing Mariachi music,” Salgado continued. “Tony’s in Illinois is a little bit more English-speaking forward. So, probably a little bit of top 40 hits.”
In general, grocers can’t go wrong with classic music from a few decades back, Bender said. And don’t discount disco. “We like to say disco is the sound of money,” she said.
Albertsons considers dayparts when creating store playlists, said Angela Moore, the grocer’s director of sales, planning, and business integration. “Music during the day tends to be more mellow, whereas music at night is modified to be more upbeat,” she said.
When SiriusXM starts working with a brand, Radhika Giri, SVP of emerging business, begins with a survey to understand the environment a retailer wants to provide for their customers.
“Could a high-tempo audio increase the speed at which people shop in the store when there is a lot of traffic in the store?” she said. “Or are there certain times of the day they want to have folks meander around and walk the aisles of the store?” That might call for mellower music.
When creating a brand’s playlist, SiriusXM, which works with retailers like ShopRite, considers the weather, time of day and what’s on display. For example, Giri said Christmas music should “align” with when a store sets up its holiday displays.
Some grocers have also begun to recognize that some customers react negatively to music and other in-store noises and have implemented sensory-friendly hours. At New Seasons Market, a chain in the Pacific Northwest, stores refrain from making announcements and playing music during sensory-friendly hours, and they reduce the volume of walkie-talkies. At Walmart, in-store TVs are turned off, and when available, lights are lowered during sensory-friendly hours.
While music tastes differ and there are plenty of companies to work with to create playlists and other audio options for grocers, grocers and industry experts agreed on one thing — the importance of licensing music. Because of laws that protect artists, retailers can be fined for playing copyrighted music without permission.
Mixing messaging with music
As retail media becomes increasingly important to grocers’ bottom lines, in-store audio has become another way to communicate ads.
RockBot, which works with retailers like Walmart, aims to provide in-store audio that combines music with marketing.
“We have a full production team that can both advise on the scripting and create the scripting of messaging and do end-to-end audio production, such that we would work with that grocers marketing team,” said Jon Cassell, COO of RockBot.
Cassell views audio as part of a larger in-store retail media solution from grocers, which includes digital signage and in-store TV screens, which RockBot also offers retailers.
Albertsons also offers in-store audio marketing options to vendors and brands as part of their omnichannel promotional packages. The grocer is part of Stingray’s Audio Advertising Network, which “enables us to secure incremental support from national brands,” Moore said.
Stingray also helps schedule audio messaging for Albertsons. “We strive to have two to three songs play before an ad and try not to have two ads running back-to-back if possible. On average, we have 50 minutes of music and 10 minutes of messages per hour,” Moore said.
Audio can reach employees, too
Music and messaging can also be an important way to build company culture. Employees are an “often overlooked audience for in-store media, music included,” Cassell said.
At New Season, each store’s operations team chooses the music. “This musical independence is very much a part of the New Seasons Market culture,” said Amy Wolf, the company’s director of operations.
Consider how often songs are replayed, and give employees the ability to increase the volume of music when the store is closed and employees are restocking. These are great ways to use audio to benefit employees, Cassell said. Audio announcements, like highlighting an employee’s great work over the loudspeaker, can foster comradery.
“Employees are working eight hours — whereas a shopper might be there for a 15-minute, 30-minute or 45-minute experience. They’re sort of living their life in this environment. And the employees play a huge role in the impact on the customer,” Cassell said. “And so even incrementally changing how your entire in-store workforce feels on a day-to-day basis makes a huge difference.”
As the swine industry evolves, the need for advanced technology that enhances efficiency and profitability becomes increasingly crucial. One such technology is the sorter, a device that automates the sorting of pigs based on weight, ensuring uniform groups for feeding or market sale. This automation not only streamlines workflows but also significantly reduces labor costs, a critical factor in an industry where margins can be tight.
The ProSort system from NuEra Enterprises is a standout in this category, offering advanced features designed to meet the diverse needs of modern swine operations. Unlike traditional sorting methods, the ProSort system uses sophisticated sensors and software to accurately weigh and sort pigs, providing data that can be used to optimize feeding regimens and improve overall herd management.
Key Features and Benefits:
Enhanced Precision and Accuracy: ProSort’s advanced sensors ensure precise sorting, reducing the likelihood of errors that can occur with manual sorting. This precision leads to more consistent weight groups, which is crucial for maximizing market value.
Labor Efficiency: By automating the sorting process, ProSort reduces the need for manual labor, allowing farm workers to focus on other critical tasks. This not only cuts labor costs but also improves worker safety by reducing physical strain and exposure to animals.
Data-Driven Management: The system’s data analytics capabilities provide valuable insights into herd performance, enabling producers to make informed decisions about feed distribution, health monitoring, and overall herd management. This data-driven approach helps in identifying trends and making proactive adjustments to improve productivity.
Durability and Adaptability: Designed for harsh environments, ProSort is built to last, with materials and construction that withstand the rigors of daily farm operations. Additionally, the system can be customized to fit the specific needs of different farm layouts and herd sizes, making it a versatile choice for a wide range of producers.
Real-World Applications:
Several farms that have integrated ProSort into their operations report significant improvements in efficiency and profitability. For instance, a large-scale operation in the Midwest saw a 20% reduction in labor costs and improved consistency in market weights, leading to better prices and reduced feed costs. These tangible benefits demonstrate the value of investing in advanced sorting technology.
Conclusion:
In an industry where efficiency and precision are paramount, investing in a sorter like the ProSort system offers significant advantages. It not only enhances operational efficiency and reduces costs but also supports better animal welfare and provides valuable data for continuous improvement. For swine producers looking to stay competitive and profitable, the ProSort system represents a smart investment in the future of their operations.
For more information on ProSort and how it can benefit your farm, visit the NuEra Enterprises website.
UK plant-based brand Fry’s Family Food has launched its plant-based mince in supermarket retailer Tesco. Its Shape & Sizzle Mince, according to the brand, is high in fibre, low in saturated fat and a good source of protein.
The mince is made from non-GM soya and is, according to the brand, ‘shapeable’, which means that it has a lot of versatility.
“We believe our Shape & Sizzle Mince is the first ever shapeable plant-based mince in UK supermarkets, which means consumers will now have a lot more versatility when it comes to making their favourite family meals. The mince works well for meatballs, burgers and koftas as well as other classics such as Bolognese, shepherd’s pie and lasagna”, says Emma Herring, head of marketing at Fry’s.
The mince is available in Tesco at an RRP of £2.50 for 300g.
Müller teams up with Myprotein for protein-filled yoghurts
Sports nutrition brand Myprotein is collaborating with dessert company Müller to create protein-filled yoghurts, aiming to tap into surging demand for protein-rich products.
The range, according to the brands, is HFSS-compliant. Each 500g yoghurt pot contains 49g of protein in natural flavours and 45g in vanilla. The range also includes 200g low-fat puddings and low-fat mouse, both containing 20g protein. The mouse comes in chocolate and salted caramel flavours, while the puddings come in chocolate and vanilla.
“The question we’ve been asking ourselves is how do we continue to optimise our health and nutrition range, while bringing something to the dairy aisle that is unique, appeals to expanding shopper needs, and drives further protein category growth,” said Richard Williams, CEO of Müller Yogurt & Desserts.
“What we found is that existing and new protein yogurt shoppers have some concerns around taste, credibility in terms of sports nutrition, and many can be intimidated by brand positioning which focuses on elite sports.
Image Source: Myprotein
“So, by expanding our range and bringing together Myprotein, who are the experts in sports nutrition with Müller’s reputation for outstanding taste, we are confident that we have found the perfect pairing for shoppers.”
The range will be available from 11 September. The yoghurt pots will be sold at an RRP of £3, the puddings at £1.95, and the mouse at £2.50.
Birds Eye expands chicken shop range
International food brand Birds Eye has announced the release of seven new products in its Chicken Shop range. The range, which aims to take advantage of the ‘fakeaway’ trend, provides consumers with classic chicken shop dishes at a retail level.
The range includes Loaded Burgers, which are available in Tennessee Style BBQ and American Style Gravy; Hickory BBQ Chicken Wings; Buttermilk Chicken Tenders; Hot & Fiery Chicken Chunks and Honey Sriracha Chicken Wings. Alongside the chicken products, the range also includes Crispy Potato Ridges.
The new items in the range are accompanied by a packaging redesign, which aims to appeal to younger consumers.
Image Source: Birds Eye
“Our Chicken Shop brand is worth over £20m RSV and having grown +30% in the past two years there is a huge opportunity beyond this for retailers. With Birds Eye’s Chicken Shop range driving incremental sales to the total frozen chicken category by bringing in younger shoppers, and with a focus on taste and inspiration from the Quick Service Restaurant sector, we’re sure that the new products in the range will help shoppers indulge in that Friday night feeling any night of the week,” said Charlotte Vause-Cross, brand manager for Chicken Shop and Birds Eye.
The range will be available in supermarket retailers from 9 September.
Subway launches new menu
Sandwich chain Subway is launching a new menu. The Wild & Mild menu will include spicy items, including the Furious Chicken Sub and the returning Jalapeno Cheese Bread, and milder items, such as the Steak Texicana sub. Subway’s saver menu will also see the addition of the fiery X-Spicy Nacho Chicken Sub, and, on the mild side, Subway’s first Ham and Cheese Toastie.
Subway is also releasing a new Wild & Mild sauce, which will be available as an option for those creating their own subs.
“We’ve added a number of new Subs to both our Signature Series range and our great-value Saver Subs menu that highlight our signature sauces – plus after a five-year hiatus, we’ve finally brought back our much-loved Jalapeno Cheese Bread!” said Deniz Safa, director of regional culinary and innovation, EMEA at Subway.
Image Source: Subway
“From our latest Wild & Mild Subs to our signature sauces, we’ve really dialled up the spice levels, so whether you want fiery hot with our x-spicy chipotle Southwest sauce, or tingly mild with our mango habanero, we’ve got something to ignite your taste buds.”
All these new items are available now.
S’mores flavour muscle milk
Sports brand Muscle Milk is releasing s’mores flavoured shakes. Available for a limited time, the shakes will include notes of chocolate, marshmallow and graham crackers.
Each container, according to the brand, has only 170 calories, and includes 25 grams of protein, is a good source of vitamin A and fibre, and has no sugar.
Image Source: Muscle Milk
“With active adults seeking more protein, the limited-batch Muscle Milk S’mores Protein Shakes deliver a delicious s’mores taste with 25 grams of protein, all in a convenient grab-and-go package,” said Marissa Pines, senior marketing director at Gatorade, parent line of CytoSport, which owns Muscle Milk.
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In the waning months of President Joe Biden’s administration, there are still several pending regulatory, policy and strategy actions with potential implications for packaging on the docket. Some of these updates have been a long time coming, including next steps for the Green Guides and the National Strategy to Prevent Plastic Pollution, both of which had public comment periods that closed more than a year ago.
The spring 2024 unified agenda is the federal road map for upcoming agency rulemaking and guidance development. The fall 2024 unified agenda has not yet been published.
These are some of the updates that industry is still waiting for clarity on in 2024:
EPA
The U.S. Environmental Protection Agency plans to release the finalized National Strategy to Prevent Plastic Pollution “later this year,” an agency spokesperson recently told Packaging Dive.
The draft was released in April 2023 and called for reducing pollution in the plastic production process and at the end of life for products like packaging. At the time, EPA expected to finalize the document by year’s end. The agency said it is still revising the strategy based on nearly 92,000 comments received during last year’s public comment period, including from packaging groups and brands.
Also related to packaging, EPA is expected to take steps to revise the existing Organic Chemicals, Plastics, and Synthetic Fibers Effluent Limitations Guidelines and Standards, according to the unified agenda. Specifically, EPA will address PFAS, or per- and polyfluoroalkyl substances, discharged from facilities manufacturing these “forever chemicals.” This is in the proposed rulemaking stage.
EPA is also developing “significant new use” rules related to phthalates, a class of chemicals used to make plastics more flexible. The agency is focusing on “conditions of use identified as not currently ongoing in the final scope documents for the High Priority Substances undergoing [the Toxic Substances Control Act] section 6 risk evaluations.”
USDA
The U.S. Department of Agriculture is expected to issue updates soon related to its BioPreferred Program, which aims to increase the purchase and use of biobased products. It includes mandatory federal purchasing requirements as well as a voluntary labeling initiative for biobased products.
The program was created by the 2002 farm bill and reauthorized and expanded in the 2018 farm bill. With the rule, USDA intends to add provisions for the Biobased Markets Program, codifying program guidance into the regulations. A public comment period was open from January to March of this year. The update also addresses how the USDA Certified Biobased Product Label may be used on packaging.
According to a USDA spokesperson, the agency has completed the updated regulation, which will be published as part of its fall 2024 regulatory agenda and take effect 30 days later.
Separately, the definition of “compost” is still under consideration following a petition last year from the Biodegradable Products Institute. BPI wanted to modernize the definition so that it accounts for composting not just as a primarily on-farm activity, but also as a commercial-scale activity that brings in food scraps and food-soiled packaging.
USDA said it referred the petition on Oct. 11, 2023, to the National Organic Standards Board for consultation. The NOSB Crops Subcommittee published a discussion document, which included requests for information, as part of its spring 2024 meeting agenda. It then gathered public comments, USDA noted. NOSB’s spring meeting featured technical presentations and discussions on compost regulations. The issue will again be discussed at NOSB’s fall meeting in Portland, Oregon, from Oct. 22-24, USDA said.
FDA, FTC and State Department
The U.S. Food and Drug Administration is pursuing front-of-package nutrition labeling, according to the unified agenda, which could mean design changes for packaged foods. Regulators say that the reason for this would be “to help consumers, including those who are busy and those with lower nutrition knowledge, make more informed dietary choices.” Additionally, the proposed rule “is being developed as part of a broader, whole-of-government approach to help reduce the burden of chronic disease and advance health equity by helping to improve dietary patterns in the United States.” FDA launched research to inform effective design in 2023.
The U.S. Federal Trade Commission has offered no public updates on its review of the Green Guides, which are guidelines for environmental marketing intended to guide companies’ acceptable use of labels like “recyclable” or “compostable” on product packaging.
Clarity on the FTC’s position could be especially important as companies seek to comply with different states’ labeling laws and emerging state extended producer responsibility laws create more rules. The FTC was considering updating the guides for the first time since 2012. An agency spokesperson told Packaging Dive this summer that the agency was still working to develop the draft updated Green Guides, analyzing numerous comments and public hearing feedback from over a year ago.
In addition to developing plastic pollution strategy domestically, the U.S. is engaged in plastic pollution policy abroad. A fifth meeting scheduled to negotiate an international agreement to limit plastic pollution by the end of 2024 is slated for Nov. 25 to Dec. 1 in Busan, Korea.
The Biden administration previously faced criticism from environmental groups for focusing on strategies around end-of-life management like recycling versus capping plastic production. But it recently evolved its position to support targets for decreasing overall plastic production and potentially negotiating a list of chemicals and problematic or avoidable plastics to phase out, a U.S. State Department spokesperson confirmed.
Congress
Aside from federal regulation, two notable bipartisan bills in Congress with implications for how packaging is handled at end of life remain stalled in the House.
The Recycling Infrastructure and Accessibility Act and the Recycling and Composting Accountability Act were passed by the Senate in March; they were previously introduced in 2022 and passed the Senate but not the House. They would establish a recycling infrastructure pilot to increase access and collect more data on recycling and composting, respectively. The bills have been supported this year by packaging trade groups including Ameripen, the American Forest & Paper Association, the Plastics Industry Association and the Can Manufacturers Institute.
HMM maps out a mid-to-long-term strategy to expand its business portfolio for future growth and proceed with global green initiatives.
Under the sustainable growth plan, the South Korean ocean carrier will invest a total of US$170 million by 2030, with US$93 million focussing on the container business, US$40 million on the bulk business, US$30 million on the integrated logistics business and US$7 million on the competitiveness enhancement.
HMM said it will enhance its capacity to deal with global environmental regulations, while it aims to achieve Net Zero carbon emissions by the target year 2045. HMM announced it will allocate US$110 million over 60% of the total investment to sustainable management initiatives, including low-carbon ships and green facilities.
Container transportation business
HMM plans to secure an operational fleet of 1.55 million TEUs (130 vessels) to prepare for the reorganization of global shipping alliances and strengthen its competitiveness. Considering the increasing fleet size, HMM will also invest US$13 million in container boxes to enhance operational efficiency.
To meet the market’s demand for eco-friendly transportation, HMM aims to acquire around 70 green vessels by 2030 and establish a carbon-neutral ecosystem across all transportation segments by 2045.
Bulk transportation business
HMM plans to extend its bulk carrier fleet to 110 vessels (12.56 million DWT) from the current 36 ships. The company also intends to diversify its business by establishing a presence in the eco-friendly energy transportation sector and gaining a significant market share at an early stage.
Integrated logistics business
HMM plans to enhance its shipping and logistics infrastructure. To improve customer service, the South Korean firm will extend terminals and acquire additional port terminals for important bases to accommodate the growing capacity. Furthermore, the company aims to expand its Off Dock Container Yard (ODCY) business and integrated logistics business to provide end-to-end services.
Competitiveness enhancement
HMM is actively moving toward Net Zero 2045 to strengthen its response to environmental regulations and achieve carbon neutrality. To reach this goal, HMM will make investments on retrofitting ship engines, securing a supply chain for green fuels, and improving operational stability and efficiency through digitalization.
Moreover, the carrier plans to develop new sustainable businesses and strengthen the organization and human resources that will execute the 2030 mid-to-long-term strategy.
Kim Kyung Bae, HMM President and CEO, commented, “By strengthening partnerships founded on trust, we are enhancing the quality of service we deliver to our customers. We remain committed to developing a resilient business portfolio and positioning ourselves as a global leader in eco-friendly shipping for the future.”
