Thursday, December 2, 2010

Oakland Port Signs Cold Supply Chain Development Agreement With Chinese Firm

The Port of Oakland, one of the leading export ports for US agriculture products, has signed an agreement with China Merchants Holdings International to strategically market and develop supply chain solutions for US exports, particularly agricultural commodities and perishable products.

Officially signed in a ceremony at China Merchants’ Hong Kong headquarters earlier this month, the agreement will focus on enhancing warehousing and logistics facilities and creating seamless cold chain services for US companies exporting their perishable products to China.

According to port officials, the agreement is part of the port's effort to "aggressively coordinating its activities" with the federal National Export Initiative. The NEI was signed by President Barack Obama in March and seeks to double US exports by 2015.

The first activity of the Oakland/China Merchants partnership was the Cold Chain and Logistics Seminar held shortly after the signing of the agreement earlier this month in Chengdu, in central China. The seminar focused on the demand for US products in the emerging markets of western China. Leading ocean carriers and logistics providers attending the event discussed distribution challenges in China's inland regions and offered case studies. The seminar was co-sponsored by the Port of Oakland, the US Foreign Agriculture Service, and the California Agriculture Export Council.

China Merchants is a public port operator in China with a network of ports in China's coastal regions, including the Bohai region, Yangtze River Delta, Xiamen Bay Economic Zone, Pearl River Delta, and the Southwest region. In the first six months of 2009, China Merchants handled almost 25 million TEUs at its ports, terminals and logistics facilities throughout China.

“The form and scale of this partnership is a first for the US port industry,” said Omar Benjamin, Port of Oakland Executive Director. “China is a significant and rapidly growing market for US food and agriculture products, but the lack of cold chain services is inhibiting the export potential. Our initiatives will help make it easier, safer and faster to export US commodities from California and distribute them throughout China.”

China Merchants recently formed a joint venture – China Merchants Americold Logistics – in partnership with US -based Americold, one of the largest cold chain providers in North America. According to Oakland port officials, this venture seeks to solidify the joint venture entity as China’s premier third-party temperature-controlled logistics provider, operating an integrated platform across 15 cities in China.