Cold Chain Logistics

Cold chain logistics companies provide distribution and storage services for products that are temperature sensitive.  At present, India is the largest producer of milk in the world and is second when it comes to growing fruits and vegetables. India also produces marine, meat and poultry products.

The Indian cold chain industry was valued at INR 1425.49 billion in 2020. It is expected that this market will grow at a CAGR rate of 14.6% during the 2021-2026 period.

  1. GROWTH IN DEMAND FOR FRESH PRODUCTS: More and more consumers are shifting to a healthier diet.  This will lead to an increased demand for specialty and fresh products.  Recent data has shown that the delivery of these products will depend on cold chain capacity.  With the increase in demand, cold chain companies in India will have to ensure that perishable products are fresh.

  1. GROWTH IN DEMAND FOR PROCESSED FOODS: The consumer demand for processed foods has increased.  The Indian government has made it clear to establish many mega food parks across the country.  This will boost the growth of cold supply chain companies in India.

  1. SHIFT TOWARDS CULTIVATION OF FRUITS AND VEGETABLES: Due to more money being invested in grain crops, more farmers are growing fruits and vegetables. These crops require refrigeration which will further aid the growth of cold storage facilities in India.

  1. GROWING DEMAND FROM THE HEALTHCARE SECTOR: Healthcare products like vaccines, biopharmaceuticals and clinical trial products are sensitive to heat and must be stored at low temperatures.  With these markets set to grow at double-digit figures, there will be an increased demand for cold chain logistics companies in India.

  1. NEW MARKET PLAYERS: Increased profitability has led to new players entering the market.  Investors who are new to this business but have good knowledge of supply chains are showing interest in this sector.

  1. MORE INCENTIVES FOR THE COLD CHAIN SECTOR: According to a recent report, the temperature-controlled storage sector will see increased investments due to cold and cold storage equipment subsidies.  Furthermore, this sector is unorganized, and the majority of the cold storage facilities in India are privately owned.

  1. SCOPE FOR FURTHER GROWTH: According to research, India’s retail sales contributed USD 630 billion in 2018.  The majority of these profits came from small and medium firms with limited cold storage equipment.

  1. BETTER INFRASTRUCTURE: The government of India has plans in place to improve the existing road infrastructure in the future. There will be more focus on developing infrastructures such as dedicated freight corridors and container freight stations. Poor road infrastructure decreases the distance covered by heavy vehicles in India. To overcome this, the government has decided to reduce the logistics cost of India’s GDP during the next two years with the help of various transport ministries.

  1. GROWTH IN 3PL AND 4PL PROVIDERS: While manufacturing has been one of the earliest industries to use 3PL and 4PL service providers, other sectors are now set to follow.  By outsourcing supply chain management, cold supply chain companies in India will get expert end-to-end solutions like documentation, tracking, warehousing, legal compliance, and kitting at competitive prices, which can help companies recover after the financial crisis.

  1. ADOPTION OF NEW TECHNOLOGY: More cold supply chain companies in India are beginning to adopt AI, ML and BIG DATA.  With newer technologies like the Internet of things, companies can make their supply chains more transparent, bringing visibility and enhancing customer experience.


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