Air cargo, trade and transportation costs of perishables and exotics from South America

Exporting time-sensitive perishable and exotic products is one of few alternatives that producers in less-developed countries have to compete in international markets. While export performance is generally linked to these producers' ability to take advantage of their geographic location and access to low labor costs, concerns about the sustainability of these economic activities encompass complex supply chains and high transportation costs. There is an increasing interest in understanding the reliability of such supply chains and the implications of high transportation costs, particularly airfreight costs. Using South America as a case study, we investigate trade and air transportation costs of perishables between 2000 and 2006. Descriptive trade statistics are complemented by an assessment and comparison of airfreight rates. The results are mostly consistent with producers' concerns. Among the inconsistencies, producers in some countries face higher transportation costs than far more distant neighbors; while in others transportation costs have decreased in the period of time examined.