Shipping is undoubtedly one of the most expensive parts of the supply chain. If you regularly ship your cargo in 20 or 40 foot General Purpose containers (or GPs) it may be time to speak to your forwarder to understand if using a non-operating reefer could be an option to reduce your costs.
In this article, we will help you understand what a non-operating reefer is and how it may benefit your supply chain. Below we’ll take a look at how the reefer works and also some differences between them and your regular shipping container.
What is a non-operating reefer?
Reefers are containers used to transport cargo that have temperature control limitations – perishable goods like fruit, vegetables, meat and dairy products. Other goods that may need temperature control could include chemicals or pharmaceutical goods. Reefers are smaller than regular containers due to the requirement for a refrigeration unit.
Non-operating reefers (NOR) are reefers that serve as dry boxes by disabling the refrigeration unit for a journey. A reefer container can be used as an operating reefer to one destination and a non-operating reefer on the next.
Reefers are designed to ensure there is accurate control of temperature and airflow whilst meeting satisfactory hygiene standards for goods such as food or pharmaceutical goods.
How can a NOR save me money?
Using a NOR as opposed to a standard container can be cost-effective for your supply chain, if equipment is available at your port of origin. This is driven by the container imbalance created when a country imports more perishable products than it exports. The cost of re-positioning empty containers is significant and therefore shipping lines offer reduced rates for NORs to incentivise customers to reposition the container on their behalf.
Case study: empty containers in Tasmania
For the 2014-15 financial year, Tasmania reported that the State’s economy spent $34 million on empty shipping containers. Whilst these were not just limited to NORs or even reefers generally, this case study shows the financial impact of shipping empty containers. The Tasmanian Chamber of Commerce and Industry chief executive commented that: “it’s a significant problem and our biggest export is fresh air”.
The chairman of SeaRoad said that businesses “needed to work together to help cut the number of empty containers shipped. He went on to say that more needs to be “be understood about freight movements … in order to improve efficiency”.
This would suggest that using NORs for the right cargo is a useful step towards cutting the number of empty containers shipped internationally. Maersk Line’s Head of Cargo Management agreed and commented that on busy trade lanes, “empty reefers are competing for slot space with revenue-earning dry cargo, so the NOR solution is attractive”.
The difference between NOR and Full Container Loads
Whilst financially you may be able to secure a discounted rate for shipping in NORs, there are some limitations compared to using a standard shipping container.
Losing this space can have a significant impact on your shipping load and may make the savings achieved with a discounted NOR rate of little benefit.
Furthermore, whilst a NOR is carrying dry goods with the refrigeration turned off, there’s the chance that it will capture hot temperatures outside if the ship is travelling through warm climate. As it retains the heat, condensation will begin to form once the refrigeration is turned on. The result is that goods that are loaded may make contact with moisture, causing damage or mould to the packaging.
It is advisable not to use a NOR when transporting goods that are not moisture-resistant, and instead use a standard FCL shipping container. NORs will not save you money if you’re forced to throw away what otherwise would have been a perfectly good load due to due to moisture damage or wet packaging.
Carrying cargo in NOR containers
It is vital that, before you approve the carriage of cargo in an NOR container, the following steps are taken to ensure your shipping transaction occurs smoothly.
1. Consider the interior design
Because NOR interiors are smaller than regular FCL containers, you’ll need to pay close attention when developing your packing plan. You’ll need to take steps such as:
- making sure the weight of your cargo is distributed across the reefer adequately;
- taking into account the fact that the materials used to construct NORs aren’t as robust and are more susceptible to stress and piercing to ensure you do not damage the reefer;
- consider how you intend to load the cargo and ensure that any fork trucks are sized so they can accommodate the lower height and narrower width of the reefer
Consider the cargo
Importantly, you must carefully assess the nature of all NOR cargo that gets loaded into the container. Some packing guidelines include:
- ensuring that your NOR cargo is clearly marked “NOR Cargo”;
- positioning the cargo uniformly over the container’s floor;
- ensuring your cargo can fit through reefer door openings, which are about 2290mm. This is about 50mm narrower than a dry container; and
- configurating the pallets taking into account that the floor area of an NOR is smaller than the floor of a dry container.
Some goods are not appropriate to ship in a NOR. The below list is not exhaustive so you’ll need to contact your forwarder to confirm whether or not your goods are suitable:
- Dangerous goods;
- Fertiliser products;
- Raw hides;
- Grain or wheat (unless packed in FIBCs – flexible intermediate bulk containers);
- Used batteries;
- Used cars; and
- Car batteries.
The Container Owners Association have published a comprehensive guide on carrying cargo in NORs.
Final tip – container recycling
If you both import and export goods around the world, another concept you may have heard of is container recycling. This is an excellent option for large volume importers/exporters, where efficiencies can be gained by reusing containers.
For example, you may bring packaging in from one country and then ship your final product (once packaged) to another country in the same container.
For this to work, you’ll need to agree on the container recycling process with a shipping line that will handle both import cargo and export cargo.
This is another great way to introduce efficiencies into your supply chain and is worth discussing with your forwarder.
If you have any further queries about how you can make use of non-operating reefers in your supply chain, don’t hesitate to contact us for an obligation-free consultation or leave a comment below.