[250213.EN.SEA] Maersk Moves Reefer Box Making To Chile - Where They Are Most Needed

MAERSK Container Industry (MCI), San Antonio, Chile, will create the first factory outside China making insulated reefer boxes when it opens in December because that is where they are most needed.

"There is a huge amount of food exported from the west coast of South America and every year and there is a significant shortage of reefers. Placing the factory in Chile will save reefer owners US$1,400, because they won't have to ship in empties," said MCI spokesman Erik Hogh-Sorensen.

Mr Hogh-Sorensen conceded the rising costs of Chinese producers - CIMC, MCI and Singamas - was a factor, but the main the reason for choosing Chile was changing trade patterns.

MCI's reefer box factory in Qingdao, in China's north-east, produces 40,000 containers and Star Cool reefer machines a year. The $170 million San Antonio factory will equal that output once production is fully underway.

"We will have two fully-fledged reefer factories once this is up," said Mr Hogh-Sorensen. "We're going to have the South American market to ourselves, and with current consumer trends, even when we reach 40,000 reefers at the new factory this will still not satisfy the market."

China is moving away from being a low-cost production centre, especially in well-established manufacturing areas, reports Lloyd's Loading List, which added that this was not sufficient reason to move out as the labour force become more demanding and expensive.

"What it means, however, is that it has become more difficult to attract labour in south China, where we have our dry box factory in Dongguan, on the Pearl River," he said.

"We're well-established in Dongguan and we'll deal with the challenges of the business environment. I think on that account we're doing pretty well. We also have a good co-operation with the Chinese authorities, who appreciate the fact that we have a good work environment at our factory," Mr Hogh-Sorensen said.

Source : HKSG.