Research: Cold storage market worth $212.54B by 2025
Compared to the traditional stores, the organized retail stores use better refrigeration and improved storage technology.
The global cold storage market is anticipated to reach $212.54 billion by 2025, growing at a CAGR of 12.4%, according to a new report by Grand View Research, Inc., San Francisco. The retail sector in emerging economies, such as India and China, are becoming increasingly organized, and is expected to augment the cold storage market demand over the forecast period. Government policies to deregulate the entry of foreign player has increased the foreign direct investment (FDI) in the organized retail sector.
The report, “Cold Storage Market Analysis By Warehouse Type (Private & Semi-Private, Public), By Temperature Type (Chilled, Frozen), By Construction Type, By Application, And Segment Forecasts, 2014 – 2025," discusses organized retailing, where the licensed retailers sell products of various categories. Compared to the traditional stores, the organized retail stores use better refrigeration and improved storage technology. Consumers are increasingly purchasing frozen foods from the organized retail stores. The organized retail supports different outlet formats depending on the proximity from residential and consumption cluster and spending power. The offline mode of the organized retailing is categorized into convenience stores, supermarket and hypermarket based on the product range and surface coverage.
Given massive investments necessary for setting up the refrigerated warehouse business, the cold chain operator must make significant volumes to attain the break-even point in a stipulated period. As a result, the growth of the cold chain services translates into the growth of the international organized retail market.
Lack of infrastructure necessary to sustain the cold chain is a major challenge for industry players to expand cold chain in the emerging markets. Additionally, lack of power hookups for reefer trailers at transportation hubs and ports coupled with the lack of reliable power supply for cold warehouses further increases the operation costs. However, this also opens opportunities for industry players to develop unique solutions or leverage alternative energy sources that can overcome the unreliable power supply in emerging markets. Furthermore, new transportation means, such as versatile refrigerated containers, are being developed to overcome the lack of adequate transportation facility. These solutions can provide access to international markets and open opportunities for farmers and small businesses in these regions.
Further key findings from the report suggest:
- Low carbon design, environmental auditing and construction of energy efficient cold storage warehouses is anticipated to fuel market demand.
- Growing supermarket-shopping culture and rising consumer preference toward private labels are the key factors for the expansion of food retail chains across the globe.
- The public warehouse segment was valued at $48.70 billion in 2016.
- The frozen segment is anticipated to grow at a CAGR of 11.4%. The growth is attributed to the significant changes in living standards and food consumption behavior of consumers.
- The processed food application is anticipated to witness a high growth rate growing at a CAGR of 16.1% over the projected period.
- Asia Pacific dominated the market in terms of refrigerated storage capacity in 2016, with India leading the market with a cold storage capacity of around 131 cubic meters.
- The global refrigerated warehouse capacity was estimated at 600 million cubic meters in 2016.
- Having realized that the cold storage market in Japan is increasingly being saturated, the cold storage operators in the country would be looking for opportunities to increase the international trade.