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ITE Transport and Logistics

Global cold chain to grow 13.9% by 2020, says new report

The global cold chain market is expected to grow at a compound annual growth rate (CAGR) of 13.9% between 2015 and 2020. According to a new report from Zion Research, the global cold chain market was valued at $110.20 billion. This is estimated to reach $271.9 billion by 2020.

Zion Research also noted that the total volume of the global cold chain network stood at 552.09 million cubic metres in 2014.

So what factors are behind this expected growth? There are a number at play. According to Zion Research, the primary driving force behind cold chain expansion is the increasing need for efficient storage systems to avoid food wastage.

This is integral to ensuring fresh produce reaches both international and domestic markets  - particularly those countries with huge distribution distances to cover such as Russia or Turkey. Greater efficiency in cold chain systems allows for perishable agriculture products, such as fruit and vegetables, to stay fresher for longer.

Another important factor, according to the report, is the rise of global populations. This has resulted in a surge in demand for frozen food. Rapid growth in these markets is expected to become one of the primary drivers of cold chain in the years to come.

This isn’t to say there will not be challenges for cold chain operators during the forecast period. Namely, the high costs of real estate and energy prices.

However, the growing export market for fish, meat and seafood, is likely to provide enough dividends to counteract these costs. Meat, fish and seafood dominated cold chain in 2014 with a 45% market share – only natural given the extremely perishable nature of these products.

South American countries, such as Chile, are hoping to increase sea food exports, as is Iran after international sectors pertaining to trade were lifted in January 2016. This will likely have a positive impact on cold chain’s market value.

Other sectors expected to boost global cold chain valuation include frozen desserts, dairy as well as fruit and vegetables. 

 

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