When you think of New York area transport, the first word that’s likely to come to mind is congestion.
If you’ve ever driven the Cross-Bronx Expressway (which mostly consists of the portion of Interstate 95 that runs through the borough), you’ll find it easy to believe that it is one of the most backed-up highways in the United States.
The Bruckner—the highway that’s closest to the terminal—isn’t exactly a drive down a pleasant country lane either. As part of New York governor Andrew Cuomo’s project for widespread infrastructure improvement, a new exit is due to be added to the Bruckner expressly to facilitate access to the terminal, but the project’s timetable is unclear.
Juan Garcia, president of Newark, NJ, based J C Produce Inc., BB #:168255 echoes a common sentiment when he says, “It’s hard to do business in the area. Every year the costs go up—insurance, labor.”
He sees an annual increase of 4 to 5 percent in these areas. The region’s high tolls add to transportation costs: “Five years ago,” says Garcia, “I spent $70,000 on E-Z Pass,” the state’s automated tolling system; “today I’m spending $140,000.”
For Garcia, these increases have been offset by comparatively low prices for diesel fuel. “Fuel costs have come down dramatically—diesel—helping our gross margins. I’m fortunate that fuel is so low,” he adds.
Garcia’s specialty is tropical fruit, so international transport is a major issue for him. He sees a better situation here than in the past: “Availability of imports in the United States are better than ever. We’re seeing a smoother flow of imports in the metro area.”
As in the industry nationwide, the difficulties surrounding the introduction of electronic logging devices (ELDs) have mostly subsided.
“ELDs have increased travel time,” admits Stefanie Katzman, executive manager of S. Katzman Produce Inc., BB #:103742. “However, all rules and regulations have been put in place to ensure safety, so it’s our job to support and work with the industry supply chain to follow these guidelines. In order to supply the freshest product possible, it’s important to limit the amount of pickups and dropoffs a truck has to make and utilize wholesale markets even more than before.”
Not everyone is so sanguine about the ELD situation. Charlie DiMaggio, president of Fres Co LLC, BB #:262433 said, “We believe trucking regulations and the way they were implemented have caused major difficulties for all business across the United States. The thought process behind it was not fully vetted. Truck availability has been scarce and increases to rates have not been proportional to the cost increase that truckers have had.
“Our business model in the Hunts Point market is truly based on a ‘free market pricing,’” DiMaggio points out. “That being said, it is ultimately hurting our shippers, growers, and distributors in Hunts Point, who very often end up subsidizing the cost increases. Eventually, as this process gets adjusted, the cost will as usual be passed on to the consumer, and to what end remains to be seen.”
Nevertheless, DiMaggio retains some optimism: “Once our government irons out the issue with ELD logs and clarifies rules, our ability to transport our products should be done with much more ease.”
This is a multi-part spotlight feature on New York produce adapted from the October 2019 issue of Produce Blueprints.