The rising demand for cold chain industry in India

The rising demand for cold chain industry in India

Share on twitter
Share on facebook
Share on linkedin

The cold chain industry in India is still at a nascent stage which makes it one of the promising fields in the warehousing and logistics industry. As per ISHRAE – Indian Cold Chain Industry Outlook 2024 Report, the Indian cold chain market was estimated to be worth USD 19.6 Billion in 2020 and is further projected to reach USD 36 Billion by 2024, growing at a CAGR of 16%.

This segment traditionally has seen limited infrastructure investments due to multiple factors including a fragmented distribution approach, low compliance and lack of awareness in handling perishables and lack of multi-commodity/multi-temperature storage facilities.

Thus far, the usage of cold storage facilities in India, has been largely limited to the storage of perishable horticulture produce such as fruits and vegetables. According to the Ministry of Agriculture & Farmers Welfare, of the 8,186 cold storage facilities with a capacity of 37.4 Million, approximately 83% are used for fruits and vegetables. However this is fast changing.

More recently, the growth of organized 3PLs, QSR, retail, e-commerce and food service industries due to changing consumption patterns have brought the cold chain segments in focus. Nowadays, consumers demand a large variety of fresh fruits and vegetables, dairy products, meat and poultry products and other temperature-sensitive commodities that require cold chain infrastructure, therefore setting up a strong cold chain infrastructure is a key step in efficiently managing their supply chains. The trend is now shifting towards establishing multipurpose cold storage and providing end-to-end services across the value chain.

Pharmaceutical products are also highly susceptible to temperature and time constraints, making cold chain a key requirement for this industry. In the present scenario where safe delivery of vaccines for mass immunization against COVID-19 is an absolute priority, the cold chain is in huge demand.

IndoSpace recently ventured into temperature-controlled warehousing space in partnership with Kool-ex, a leading Pharma Cold Chain Logistics Service Provider, to build customised, GDP/GWP-compliant, temperature-controlled pharma distribution centres across the country.

IndoSpace and Koolex are jointly designing and setting up three warehouses in proximity to Mumbai, Delhi and Bangalore, with each having 36,000 pallet positions. The work at IndoSpace’s Khopoli warehouse is in progress, and it will be India’s largest standalone temperature-controlled warehousing facility.

IndoSpace plans to develop around 10 such warehouses over the next few years. Along with developing the technology for temperature-controlled warehousing, IndoSpace parks also have the location advantage with respect to the pharmaceutical sector. The strategic locations of IndoSpace parks enables companies to reach 92% of the pharma manufacturing market and 85% of the consumption market.

Overall, the cold chain capacity in India, will continue to grow aggressively to reach 40.7 million metric tonnes of total perishables by 2023, rising 8.2% from 2020, according to a Colliers report. The segment is expected to become more organised and attract more institutional funds. Future trends in this sector may include built-to-suit assets with superior building specifications, diversity in cold storage offerings catering to higher-value commodities and use of sustainable solutions for reducing operational costs.

Phone
Toll Free No: 1800 267 4636