According to the World Economic Forum, food crises is one of the top ten risks to the world now and for the next ten years.
While global economies spend billions of dollars on enhancing agricultural technology and processes to generate greater food yields, almost half of that food never makes it to consumers—an issue that is often overlooked.
That’s where cold chain systems can help. They play a crucial role in the development of global trade in perishable goods, food and health supplies.
Given the usefulness of cold chain technologies, the global market for cold chains is thriving in some respects (and will grow significantly within the next five years), and also faces challenges to growth.
Today’s blog provides a quick analysis of the cold chain market, focusing specifically on three important trends you need to know.
Cold Chains Defined
Before we delve into our analysis of the cold chain market, let’s define “cold chains” more clearly.
In our recent market research report, “Cold Chain: Market Overview and Top Ten Companies,” we define the word “cold chain” or “cool chain” as the sequence of actions and machinery used to preserve a food product or type of supplies, from harvest/production to consumption, within a defined low temperature range.
Essentially, a cold chain is a supply chain that is temperature-controlled, used for preserving and extending the shelf-life of goods such as fresh agricultural goods, seafood, frozen food, photographic film, chemicals and pharmaceutical drugs.
When cold chain systems work effectively, i.e. when they are unbroken, they provide a continuous sequence of refrigerated manufacturing, storage and distribution operations, along with related machinery and logistics, maintaining a required low temperature variety, enabling the movement of perishable goods to consumers.
However, billions of tons of fresh foods and millions of dollars are lost each year in developing economies owing to bad cold chain systems, which brings us to our analysis of the global cold chain market.
3 Cold Chain Market Trends You Need To Know
1. Many cold chain systems are ineffective.
When designed and executed correctly, cold chain facilities boost the quality of life of billions of individuals around the globe, especially those in less-developed economies suffering from malnutrition, elevated food spoilage rates and chronic disease.
But the sad reality is that many cold chain systems fail to achieve desired outcomes. Several factors contribute to the failure of cold chains, including:
- Instability in a country’s government and poor regulatory environment;
- Lack of skilled labor and inability to train unskilled labor;
- Poor infrastructure within a country;
- Low demand or need for cold chain services within a country.
2. The Asia-Pacific market will experience the most growth.
The Asia-Pacific region is also forecast to see considerable growth—9.2% annually through 2024. Specifically, China will see the most growth, thanks to rapidly growing demand, developments in cold chain infrastructure and a major transition from a construction-and manufacturing-led economy to a consumer-led economy.
The demand for transportation and storage of vaccines and seafood products at a specific or desired temperature is also fueling market growth in China.
With growing technological advancements in warehouse management and refrigerated transportation, along with growing government subsidies that enable to find innovative solutions to overcome complex transportation challenges, the global cold chain market is likely to witness expansion in other developing economies in the Asia-Pacific region.
3. Growth in biopharma will drive growth in cold chains.
The biopharmaceuticals market is expected to see significant growth in the next few years, thus impacting the growth of the cold chain market. For example, global sales of biotechnology medicinal products and biologics was estimated at over $300 billion in 2018. Most of these high-value pharmaceutical goods are transported through the cold chain through a global distribution network.
Additionally, about 95% of the shipments of blood, stem cells, disease biopsies and patient examples are dispatched at or below freezing temperatures, demonstrating that cold chain systems are currently needed for safe transport of these items and will be needed in the future.
Market data indicate that by 2021, the biopharma cold-chain logistics will be worth $16.6 billion while the non-cold chain market is expected to reach $76.5 billion.
Learn More About The Global Cold Chain Market
Download a free chapter of our recent report, “Cold Chain: Market Overview and Top Ten Companies.”
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