Determinants of Refrigerated Container Provisioning for Agricultural Exports

Rapid growth in global incomes and the world’s affluent population, coupled with changing consumer tastes and frequent shocks to food supplies, places unprecedented pressures on the world’s food demand and supply balance, and by extension, the worldwide “cold-chain” food transportation and logistic systems. Rising demand for perishable goods, along with the growth in containerized transportation systems, is leading to significant growth in the refrigerated containers trade (“reefers”). In fact, reefer traffic (sea, rail, and over-land) is projected to grow faster than the overall containerized food trade, and this trend is expected to continue into the foreseeable future.In this report, we study the factors that impact the provisioning of reefers for the movement of agricultural commodities through the major U.S. West Coast Ports. We study the historical reefer movements at these ports and delineate the seasonal patterns that lead to imbalances in demand and supply of reefer containers. We then construct a dynamic econometric model and identify the drivers of reefer exports from these ports. The model provides estimates of the impact of prices, U.S. dollar exchange rate, economic and political uncertainty, trade frictions, onset of infectious disease (COVID-19), and port efficiency metrics on volume and value of U.S. refrigerated exports