The transportation industry juggles shortages, inflation and scheduling.

The key between field and fork is transportation. In the U.S., trucks are responsible for 83% of agricultural freight movements by tonnage, including fresh fruits and vegetables, according to a 2020 U.S. Department of Agriculture report. Trucking also serves as the essential “first and last mile” transport to other modes such as rail, sea and air.

Looking ahead, here are six challenges in produce transportation for this fall and into 2025:

1. AVAILABILITY

Produce has always been the most challenging aspect of the transportation industry, as it’s truly a “just in time” inventory system.

“The number of carriers in this group is smaller and exceptionally specialized,” says Bob Rose, vice president of national accounts for the Allen Lund Company, in La Canada, CA. “Many refrigerated carriers are not cut out to be produce haulers. The old-timer produce haulers of my youth are now out of the business, and it takes years to train great drivers for this industry.”

In addition, there was a net loss of carriers in 2022-23. Nearly 88,000 trucking companies and some 8,000 freight brokerages closed up shop during this time, according to data from CarrierOK, based in Chicago, IL.

“Many refrigerated carriers are not cut out to be produce haulers. The old-timer produce haulers of my youth are now out of the business, and it takes years to train great drivers for this industry.”
— Bob Rose, Allen Lund Company, La Canada, CA

Plus, the actual flow of truck capacity in the market is inconsistent, says Evan Kazan, logistics specialist for Target Interstate Systems, Inc., in Bronx, NY.

“Because of the slow economy, we are unable to get freight to reposition our trucks back to the produce-growing regions, which is creating significant swings and gaps in capacity,” he notes. “Seasonal trends are punctuated by spot shortages, making scheduling loads with carriers problematic.”

On top of all the produce aspects, the trucking industry has been hit with many more claims and thefts in the last 18 months, adds Rose. “Our vetting process has become much more robust, and we are very picky about the carriers that enter our network, thus producing a better pool of carriers, but less overall volume.”

Rose predicts produce truck rates will increase over the next six months as fewer carriers enter the marketplace.

Overall, a foremost hurdle is the “trucking recession” following the good times of 2020-2022, that is “suppressing rates, increasing equipment prices, and making it harder to find quality long-term labor,” says Pete Amundson, director of business development for Minuteman Transport, in City of Industry, CA.

2. LABOR SHORTAGES

The transportation industry has been managing labor shortages for quite some time. Due to a scarcity of truck companies, it ultimately creates bottlenecks in the produce supply chain, bringing about delays and higher costs, according to Chris Bueso, public relations coordinator for Curv Logistics, in Cutler Bay, FL.

“Labor shortages are an ongoing problem, which can slowly improve,” Bueso says. “We feel that offering a better system of incentivized work conditions can help ease labor inconsistencies.”

However, overall improvements would be found well beyond a short-term outcome, Bueso adds. “Automation can be the alternative to providing needed support, but integration will take time.”

3. COSTS & INFLATION

The overall economy always impacts the movement of fresh fruits and vegetables, since so much of what is purchased beyond produce staples — “the items that you grab because they look, smell, or taste good” — relies more on impulse purchases, says Target Interstate Systems’ Kazan.

“In tough economic times, these purchases drop significantly, and some fresh purchases are curtailed in favor of frozen foods. This naturally affects the entire supply chain, creates less demand for trucks, and causes an overcapacity of equipment,” Kazan explains. “Inflation naturally affects all aspects of transportation, as the rates do not cover the additional costs incurred by the carriers due to inflation.”

At the same time, a challenge is companies flood the market with bad rates.

“The barrier to entry is fairly low, and some companies will issue bad rates to get business,” says Robert Platschek, chief executive officer and founder of TOV Logistics and U.S. Freight LLC, in Cleveland, OH.“The two challenges that result are either the company will go out of business, or some buyers will ask us to match the bad rate, and that’s not good for business.”

Trucks are not making much money right now, and inflation has hit all carriers with increased costs for drivers, insurance, fuel, parts, you name it, adds Allen Lunds’ Rose. “The more inflation hits our industry, the more product costs rise, making it harder for us to buy more produce at the supermarket. These cycles have been in the produce industry for decades, but the cycles seem to be getting shorter and shorter overall.”

The solution is setting yourself up for success every day, which means strategizing ahead of time, not at the last minute, says Curv Logistics’ Bueso, and by “establishing new relationships each morning with truck carriers. Combine this with negotiating competitive, fair pricing rates to always maintain a surplus of transportation drivers ready, which can help alleviate the bottleneck effect.”

4. SCHEDULING

The biggest produce transportation challenge is scheduling in a secure, on-time manner before the perishable factor sets in. “There are many circumstances we can encounter that cause delays, and any logistical errors can increase cost and waste,” says Bueso. “The solution is real-time tracking systems and predictive analytical systems, and it’s how we optimize routing and scheduling. The extensive detail and collaborative efforts between our team and farmers, distributors, and retailers are paramount to successful produce delivery.”

Target Interstate Systems has recently launched ProduceTrak. This online tool allows all to see their produce shipments in near real time, regardless of the system used to track the produce shipments.

“It essentially aggregates all the location notifications a customer receives from all their vendors and puts it on an interactive Google map with easy and actionable data. This information can be sorted by commodity, shipper, and ETA of delivery. It alerts the customer to loads that are on time, behind or not making delivery by color coding the pushpins that represent each load,” says Kazan.

5. TEMPERATURE CONTROL

New systems that Curv Logistics has implemented, and mandatory for its drivers, are to run multiple detailed checks during the loading process. This is to confirm the temperature of the product before departing with the shipment, to verify the produce is within the temperature range.

“This is imperative because the trailer refrigeration system is meant to maintain precise temperature conditions. If the product is either too warm or cold before loading, it will affect the quality of what our customers are selling to the consumer. It’s an essential step to prevent waste and unnecessary cost,” says Roger Moreno, intermodal/flatbed division, Curv Logistics.

Shippers’ guidelines that allow the loading of too-warm produce can be problematic at the point of receipt and a liability for transportation companies, says TOV Logistics and U.S. Freight’s Platschek. “This happens with fruit more than vegetables, and high-value fruit where supplies are tight.”

Strawberries or cherries are an example. “Shippers’ guidelines allow a certain loading temperature that may be higher than we have on the truck. Our temperature refer download report shows we maintained 34 degrees continuously, but the retailer may refuse the load after doing internal temperature checks of the fruit on delivery. Who pays for that? I’ve had 20 claims in the last six to seven weeks, when normally we get maybe three claims a year tops,” says Platschek.

6. LAND, SEA & AIR OUTLOOK

“We predict the cost for rates in the trucking industry is certainly going to rise through 2024, influenced by the influx of high demand and minimal available capacity,” says Curv Logistics Bueso. “Spot rates may remain lower than contracted rates initially, but could eventually pass contract rates as the year continues. Many of these circumstances are due to a lack of needed truck drivers.”

Ocean transport will experience a lower projection on rates, due to an overabundance of shipment capacity in 2024, adds Bueso. This is “since a staggering amount of ocean shipping services have not met the demand to keep up with the pace needed, forcing carriers to utilize more economical approaches, such as slower speeds to reduce fuel consumption. Overall, providing more agreeable pricing arrangements for companies to ship by ocean freight may help.”

Finally, the cost associated with air freight transport may remain steady. On the other hand, geopolitical conditions in fuel resource pricing may cause fluctuations.

“The year 2024 may show signs of recovery in the air freight demand, but much depends on economic conditions, along with fuel price trends,” says Bueso.