The global cold storage capacity report for 2016 is in and it shows that the cold storage industry is set to grow even further thanks to continually emerging markets.
With reefer containers, mega cold rooms and blast freezing popping up in all corners of the world, the cold storage market and its clients are seeing new business opportunities appear everywhere from Turkey to China.
According to the latest reports by the Global Cold Chain Alliance, global cold storage capacity grew to an impressive 600 million cubic metres in 2016.
The group, which represents temperature controlled logistics companies, found that much of the new development occurred in emerging markets like China, where the warehouse capacity for cold storage grew an incredible 41% between 2014 and 2016.
In countries with underdeveloped cold store facilities, their cold chain doesn’t offer nearly enough temperature controlled units to fulfil the needs of the fresh food chain in these areas. In emerging markets, wastage is highly likely and the problems that come with re-freezing and improper storage are having an impact on food businesses.
Nonetheless, this is slowly but steadily changing for most countries, with many areas that had almost no cold storage facilities seeing a huge rise in just a few years. Uzbekistan is one of the country’s leading the way with this growth, having more than tripled their cold store facilities to 3.5 million cubic meters since 2014.
The growth of disposable income is mainly responsible for this continuous increase in demand. As more people in developing countries see their wages increase, the demand for perishable goods such as meat, dairy, fish and fresh vegetables grows. This of course, has a knock on effect for the cold storage industry, as more food organisations look for ways to keep up with a growing demand.
Despite global cold storage growth remaining strong, it has certainly slowed down in the last two years. From 2014-2016, growth stood at 8.6%, however previous to this it had been at an impressive 20%.
Whilst emerging countries like China and India continue to grow, almost all European countries have seen a fall in the demand for cold storage. An exception to this rule is Turkey, which actually saw a capacity increase of 36% from 2014-2016, making it one of most rapidly expanding countries surveyed in this report.
The decline in capacity may have something to do with increasing food costs and falling wages in many European areas, but the reasons are not entirely clear.
A bright future
Whilst the global market has slowed down from previous years, it still shows no real signs of stopping, especially in emerging markets where wages and demand continue to increase.
An increase in demand has created more reliable, high quality cold storage and in turn, this has encouraged food companies to expand or even set up new businesses across the globe.