b'32American Journal of TransportationNOVEMBER 20 - DECEMBER 17, 2023(REEFERScontinuedtheresilienceofthereefertoTuthill.Climatechangeis from page 28) tradereefersusuallyholdputtingalotofpressureon requiresanincreaseof20%- their freight rates better thangrowing regions. That in turn 30% of the vessels total powerdryboxesalthoughtheputspressureonsuppliersto consumptiontosupportthesurge in demand coming outfind alternative sourcing which reefersoperation.Forexam- ofCOVIDwastheexcep- often costs more. For instance, ple, aboard a 23,000 TEU vesseltion.Tuthillinhisanalysiscitrususedtobeprimarily withacapacityofover1,100ofreeferperformancesaid,coming from Florida and now reeferplugsat100%utiliza- 2021wasananomalyjustthere are sourcing options out tion, requires 30% more energybecause freight rates were soofSouthAfrica.Avocados demandofthevesselsmainhigh. But if you look acrossprimarilycomefromSouth operating plant.This results inthe last 10 years, in terms ofAmerica and Mexico, and now asignificantamountofaddi- ratestability,reeferdemandthere are sourcing options out tional fuel burn to maintain thecargogrowth,predictability,of Egypt. So, theres all these reefer operating requirements.andperishablecargoprofit- alternativesourcingoptions So, it makes for a compellingability for the (shipping) lines,thatarecreatingmoreand argument to make sure opera- the reefer trade held up betterexpansion in reefer traffic and torsfocusonmoreefficientthan most other commodities,longer transitsreeferoperationsandmakeand the reefer trades seem toHavingmoresourcing sure they arent increasing thebe more resilient.optionshasmadetheperish-powerconsumptionfromtheTuthilladdedthattheable sector able to better sur-[vessels] main plant to makepredictedgrowthrateforvive what Tuthill calls supply sure they hit their targets with2024 is about 4%. But stabil- shocks. Many of these supply theIMO[InternationalMari- itydoesntmeanthereisntshocksarenaturaldisasters, time Organization], Tuthill says. change in the reefer market.likedroughts,flooding,hur-The IMO targets are veryAs with the ships and thericanes,earthquakes,and muchinplayforboxshipreefers,climatechangeisalike. [Editors note: A recent operatorsandhavehelpedcausing more outsourcing now(REEFERScontinued on underwritethenewbuild- thaneverbefore,accordingpage 34)ing spree. It is estimated that over10,000vesselscould bescrappedasaresultof beingunabletomeetthe IMOtargets.[SeeAJOT https://www.ajot.com/news/over-10000-vessels-face-being-scrapped-within-three-years-after-pivotal-imo-ship-ping-announcement] WhiletheIMOformula is both complex and contro-versial,thereareanumber oftargetsthatarerapidly approachingwiththeenvi-ronmentalmandates.[See IMOChart].Comingupin 2025theEnergyEfficiency DesignIndex,betterknown asEEDIPhase3(onlyfor newships),willrequirea 30%reductionincarbon intensitytotakeeffect. The EEDI has different goals for differenttypesofships.In thecaseofmegacontainer ships (200,000 dwt built after April1,2022)itmustbe 50% more efficient than the baseline. In 2030 a reduction of CO2 emissions by at least 40% from the 2008 baseline. And by 2050 CO2 emissions must be cut by 79% and total GreenhouseGases(GHG) emissionsby50%fromthe 2008 baseline. But it isnt just ships that havetobecompliant.With reefers being such an impor-tant component of the power consumptioninthetransit, they too could be prematurely renderedobsoletebyIMO mandates. Tuthill believes this is happening with reefers like it has with ships, So, I think what were finding is refrig-eratedcontainerswillstart tohaveareplacementratio thatsprobablyshorterthan itwasorhasbeen,because ofthetechnologyefficiency and the demand on operators to make sure their operations from a reefer perspective are more compliant.t her eeferSe DgeAnotherreasonforthe uptick in reefer slots is simply'