AirAsia eyes durian flights as part of farm-to-table food push

KUALA LUMPUR (June 17): Asia’s biggest budget airline AirAsia Group Bhd is mulling flying thorny, pungent durians around the region as part of a plan to use its trucks and planes to send food straight from farms to restaurants.

The Malaysia-based airline’s agriculture e-commerce platform Ourfarm has a network of 7,000 trucks for pickups and deliveries in the Kuala Lumpur area, and is readying planes to quickly transport fresh produce including fruit, vegetables, meat and fish, into Singapore and Malaysia’s Sabah and Sarawak in the next three to four months.

“It’s the durian season now and we’re working very hard to get them on board,” Ourfarm Chief Executive Officer Lalitha Sivanaser said in a phone interview. “The Singaporeans, the Thais, as well Indonesians have reached out for durian exports using our platform.”

The coronavirus pandemic triggered disruptions in food supply chains around the world, snarling logistical operations and choking transport of fresh produce as multiple government lockdowns shut borders, closed ports and curbed trade.

The crisis has also roiled the airline industry. AirAsia is among many global airlines facing financial difficulties because of widespread flight cancellations. It plans to reduce costs by at least 30% this year by deferring aircraft deliveries, cutting salaries and reworking fuel hedging, and is in talks for possible joint ventures for additional investment.

The carrier, which has posted losses for three of the past five quarters and is due to report first-quarter results later this month, has resumed some flights in Malaysia after suspending all services for much of April.

“From an AirAsia perspective, the crisis has created an opportunity for us, by looking at a way for us to utilize our airlines facilities to build traffic for us,” Sivanaser said. The agriculture industry is a business that’s “forever green,” but could get easily disrupted by connectivity issues and even the weather. “We want to come in and help connect those dots,” she said.

Ourfarm will cut fresh produce procurement costs by as much as 25%, the company said, as small businesses can source directly from farmers, breeders and fishermen.

Source: TheEdgeMarkets