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ITE Transport and Logistics

What’s driving cold chain development in Russia?

Global cold chain and chilled logistics is expected to top out at $271.3 billion by 2022, expanding at a compound annual growth rate of 7% from 2017 onwards. Importantly, the BRICS countries are being eyed up as potential leaders too of this rapid growth.

Where does Russia fit into this? The world’s largest country is faced with daily transport and logistics challenges, thanks to its sheer size and diverse geography. But many aspects of Russia’s economic and societal health are dependent on temperature sensitive transport services.

There are many factors that are driving cold chain’s development in Russia – creating a stronger environment for chilled transporters, and smoother transit operations for logistics customers. Let’s take a look at some of them now.


5 factors fuelling Russia’s cold chain market growth


New rules for medicine transportation & storage

March 2017 welcomed a flurry of new nationwide regulations governing the transport and storage of medicines in Russia. Now, pharmaceutical companies must ensure their operations are in line with these requirements, which have been based on EU and US standards.

To ensure the quality of medicines across supply chains, warehousing and storage centres must be outfitted with the correct chilling equipment. Likewise, when pharmaceutical items are moved around Russia, they must travel in the proper conditions – i.e. be stored in transit in the proper temperature.

Russia’s pharmaceutical industry is predicted to double in value over the next four years, from $20.91 billion now to $38.5 billion by 2021. Higher levels of both chilled transport and logistics services, and the necessary equipment will be needed throughout Russia, to keep up.


Russia growing food exports
 

Ongoing sanctions on food imports have invigorated Russian agriculture to the point where the nation is getting ready to export record levels of food. It is already the largest exporter of grain in the world, and now exports of meat, seafood, and fruits and vegetables are scheduled to increase.

China, in particular, is getting ready to receive more Russian produce. By 2028, Russia is aiming at exporting 52 million tons worth of food and drink items to its neighbour, hinting at extensive cold chain operations necessary to supply the 1.3 billion-strong Chinese market.


Russian logistics firms offer more chilled transport options
 

The growth of Russia’s cold chain is being spurred on by major transport and logistics operators offering temperature controlled logistics services. RZD, Russia’s state railway monopoly, began development of dedicated temperature sensitive rail freight in 2014 – although that reveals the time it has taken Russia to hop aboard the cold chain train.

Likewise AirBridgeCargo (ABC), one of the leading lights of Russia’s air freight industry, has also noted a rise in the number of orders needing chilled transportation. Mostly, these are agricultural deliveries to Russian trade partners, or imports of goods, such as salmon, from non-embargoed countries. ABC is eyeing up increased pharmaceutical deliveries too. Sheremetyevo, Moscow’s chief airport, also now runs a dedicated 580sqm pharma facility. 

Majors such as the above two, stepping up their cold chain operations, is a solid indicator that chilled transport demand is growing throughout Russia.


Frozen food driving domestic cold chain demand
 

Russian revenues from frozen food exceed $4.9 billion a year. Tighter household budgets are predicted as cultivating even greater sales of frozen foodstuffs. Convenience and cost-effectiveness is a big trend amongst Russian consumers, which frozen meals offer in abundance. Shoppers’ tastes are having a knock-on effect on the transport and logistics sector.

Increasing sales of frozen foods, such as ready meals and deserts, is stoking up the need for more refrigerator trucks, warehousing, and storage facilities. For context, frozen products often must be kept at temperatures -18°C and -24°C, while fruits, vegetables, and chilled items should be stored at around 0°C to 5°C.
 

Electronics equipment imports shaping chilled transport options in Russia
 

Mirroring the Sino-Russian food trade, greater levels of electronic goods are moving across both states’ borders. Such cargoes might not be the type of temperature-controlled transport that normally springs to mind, but electronic components are normally very sensitive, even to the slightest environmental changes.

Part of the catalyst for RZD’s own cold chain development was heightened Chinese electronics shipments. Their destination is often a European endpoint, but to get their they must cover Russia first. Given the Russian weather can be quite extreme, especially in winter, transporting such goods in the proper atmosphere is integral to their final performance. 

It appears that China is actually a big player in fuelling Russian cold chain expansion – as food, drink, and electrical items continue to be top trade goods between the two countries.


Connect with the Russian cold chain at ITE transport & logistics events


If you are looking for the leading suppliers of chilledfrai transport services in Russia to move your cargoes, or you are a supplier of cold chain sector-related equipment and machinery, why not attend one of our Russian transport events?

CeMAT covers all aspects of intralogistics, including everything from forklift trucks through to tailor-made solutions for individual industries.

TransRussia is Russia’s biggest and best transport and logistics event. It’s the ideal place to grow your truck loads across the country, or to connect with Russia’s leading transportation operators.

Interested in getting involved? Contact us now for more information on our Russian transport and logistics exhibitions.

 

Related Events

Event15 Apr

TransRussia 2019..

15-17 April, 2019
RUSSIA

MOSCOW, RUSSIA
Venue: CROCUS EXHIBITION CENTRE

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