Air cargo exports of NZ's products severely impacted by shortage of liquid CO2 - Wellington News
by IANS | Updated Jan 16, 2023
According to the World Bank, exports account for about a quarter of New Zealand's gross domestic product (GDP).
The Customs Brokers and Freight Forwarders Federation of New Zealand (CBAFF) is calling on the government to investigate options to increase domestic production of food grade CO2, including the possibility of reopening the Marsden Point refinery, which produced CO2 as a by-product of its refining operation, reports Xinhua news agency.
Liquid CO2 is used to create dry ice, with many thousands of kilograms used weekly to fly high quality perishable goods, including meat, fish, dairy and pharmaceutical products, internationally.
New Zealand's food sector accounts for 46 per cent of all goods exported by New Zealand.
CBAFF Chief Executive Rosemarie Dawson said in a statement that many of its freight forwarder members are reporting difficulties with shipping customers' product out of New Zealand because they cannot source dry ice.
"Dry ice is an absolutely necessity for a lot of product that goes out of this country," said Dawson. "A number of our members are telling us they simply haven't been able to ship their customers' air freighted product."
"For instance, one company which would normally use seven to 10 tons of dry ice a week for air-freighting perishable goods, is currently only able to source about 200 kg and last week they could not source any dry ice in the North Island at all," Dawson said.
"Dry ice cannot be 'stockpiled' as it only has a shelf life of four to seven days. The cost of dry ice has also risen from four New Zealand dollars per kg to 18 New Zealand dollars per kg since October. There are two distributors of dry ice in New Zealand and they can import some liquid CO2 but it is nowhere near enough to meet demand."
"We are in competition with Australia, which has dry ice priced at around three New Zealand dollars per kg and is getting its air-freighted product to market reliably at a lesser cost," Dawson said.
Since the closure of Marsden Point last year, New Zealand has had just one domestic producer of food grade liquid CO2, Todd Energy's Kapuni plant in Taranaki. This closed in a safety-related shutdown in December with no current indication of when it will reopen.
Dawson said in the long term, delays in delivery and rising costs could result in New Zealand exporters losing market position.
The shortage can also affect movement of vaccines and other temperature controlled medical supplies. Many overseas customers of New Zealand product also purchase small samples for testing ahead of placing a large order, Dawson added.
"We have members who have been unable to ship even small 10 kg to 20 kg samples of items such as pharmaceutical products for testing. Those international customers could look elsewhere," said the chief executive.
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