Food Cold Chain Market Size, Share & Trends Analysis Report By Type (Cold Chain Storage, Cold Chain Transport, Monitoring Component), By Applications (Fruits and Vegetables, Meat and Sea Food, Dairy and Frozen Desserts, Bakery and Confectionery, Ready-to-eat Meals, Other Applications) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2023-2031

Market Overview

The food cold chain market size was valued at USD 317.50 billion in 2022. It is projected to reach USD 677.70 billion by 2031, growing at a CAGR of 8.79% during the forecast period (2023-2031). Concerns about food waste, supplier risks, system malfunctions, and security breaches are becoming more pressing. North America is the region that generates the most revenue and is predicted to expand at a compound annual growth rate of 8.19% over the anticipated period.

The cold chain is a practical method for protecting temperature-sensitive commodities during transport by using refrigerated and thermal packaging. Supply chain management now includes incorporating and processing temperature-sensitive products using cold chain solutions. Throughout the projected period, increased perishable goods commerce is anticipated to drive demand for these solutions. Cold chain companies are gradually implementing renewable energy options like wind and solar to reduce operational costs. The global food and beverage industry commonly uses the cold chain to protect products against thermal deterioration. 

Market Dynamics

Food cold chain market drivers

Heightening concerns related to food wastage

Around the world, food waste is becoming a big concern. The FAO estimates that nearly one-third of all food produced worldwide for human use is wasted each year. The loss of land, water, and biodiversity, as well as food production, are significantly influencing the environment. This, combined with the unfavorable effects of climate change, is pushing businesses to implement food cold chain solutions. The intensified usage of refrigerated rooms and transportation methods throughout the food supply chain is further compelled by the increased demand for food and the higher expectations consumers have for the quality of goods. 

Furthermore, the Global Food Security Program estimates that industrialized nations like Europe and North America produce 95 to 115 kilograms of food waste per person each year. The amount of consumer food waste produced in low-income countries, particularly in Sub-Saharan Africa and South/Southeast Asia, ranges from 6 to 11 kg per person yearly, or one-tenth of this level. Post-harvest losses are significant due to inadequate storage facilities, and frequent rat, pest, and disease infestations also contribute to such wastage to a greater extent. As a result, limited market access reduces potential, but on the other side, these easily fixable issues typically give the cold chain market a foundation to expand. These obstacles include a need for a contiguous cold chain, transportation, packaging, and distribution networks.

Food cold chain market restraint

Supplier risks, system failures, and security breaches

The complete architecture of cold chain solutions, starting with the producers of raw materials, suppliers, and logistic handlers, is included in the supply chain along with many different aspects, levels of authority, and participation from many parties. This creates many potential issues prior to shipping, particularly in the food and fresh produce industries, where damaged commodities are often packaged before being inspected for quality or spoilage. This is especially true when it comes to suppliers. 

On the other side, poor packing techniques harm the final items, and even following packaging regulations affect product consignment. It is typical to review the entire packing process at the origin of the cargo in a temperature-controlled environment to prevent temperature excursions at the start of the cold supply chain. However, in most situations, failure to take the necessary actions and a lack of knowledge of the authorities' established recommendations for best practices result in product losses.

Food cold chain market opportunities

Rising demand for convenient and frozen bakery options

Increased urbanization in the area, particularly in Europe and North America, has given foreign businesses great opportunities to operate there, driving up demand for frozen bakery goods. As frozen bakery products have a longer shelf life, maintain quality, and are generally less expensive than fresh bakery produce, producers have been forced to choose them due to the government's tough food restrictions to limit processed foods. Contrarily, consumer demand for baked goods that are additive-free, non-GMO, clean-label, and health-promoting necessitates sophisticated preservation techniques; as a result, expanding the cold chain environment is driving the market growth. It is well-recognized that frozen baked goods offer high-quality, secure, and nutrient-dense items at a reasonable cost. 

The market under study has been primarily driven by customers' growing awareness of the advantages of frozen baked goods. The growing health consciousness has significantly influenced the expanding popularity of frozen baked goods among the emerging middle class. Consumers can purchase more expensive frozen bakery goods with better nutritional profiles and longer shelf lives as discretionary expenditure rises. The market for frozen bakery items has been driven mainly by convenience and on-the-go snacking, keeping pace with the growth trajectory for cold chain storage in the long run.

Regional Analysis

North america dominates the global market

The global food cold chain market is divided into four regions: North America, Europe, Asia-Pacific, and LAMEA. 

North America is the most significant revenue contributor and is expected to grow at a CAGR of 8.19% during the forecast period. The cold supply chain sector will be able to expand during the forecast period thanks to rising demand for and adoption of cold chain products in retail stores, as well as storage and transportation from farms to stores and from stores to customers. Companies are also concentrating on technological developments, such as real-time data trackers, blockchain for traceability, and others. SensiWatch, a new supply chain sensor platform established by software companies like Sensitech, could deliver information on temperature, light, humidity, and location of fresh food every five minutes. However, the necessity for a cold food chain is growing in the US market due to the demand for fresh organic food products like dairy, fruits, vegetables, meat, and other perishable goods. 
Some reasons boosting the need for food cold chains in the Canadian market include seasonality, time-temperature variance, and year-round road accessibility. A cold supply chain with improved technology is also gaining traction as consumers switch from highly processed, unhealthy foods with a long shelf life to temperature-sensitive, perishable food goods. The Canadian food cold chain is also constrained by issues with fraud management, dependable sourcing, and temperature control; as a result, several businesses are emerging to fill the gap. Chainvu and Peer Ledger are two examples of companies offering blockchain solutions. Additionally, as the industry experiences a desire for more frozen goods, corporations are investing in AI, IoT, and data collection.

Europe is expected to grow at a CAGR of 8.03% during the forecast period. Most of the food consumed in the United Kingdom is imported, and the cold chain market strongly depends on EU nations like Spain for ambient goods like tinned tomatoes and pasta and Italy for ambient goods like vegetables and salads. Due to the need for frozen/chilled pork, poultry, and other products, the market's players have also hit their maximum capacity. As a result, the global players are using this chance to grow their market share. In addition, Spain is one of the top exporters of fresh produce in the world, primarily to Europe, and it is diversifying into farther-flung consumer markets. As a result, the market for the cold chain for food is expected to grow throughout the forecast period. Companies are entering new markets to suit the high demand for frozen dinners and fruit and vegetable goods. For example, Fruveco announced the opening a cold storage facility in Alabama with a capacity of 200,000 pallets. For onion rings, the player is the sole provider to international chains like McDonald's, Burger King, and Foster's Hollywood.

China is one of the biggest producers of agricultural and animal products; for instance, the country's agricultural production was worth over 6.15 trillion yuan in 2018 (as per the National Bureau of Statistics of China). However, there have been more instances of vegetable and animal produce losses related to insufficient transportation procedures and other food restoration facilities in the nation because of the inadequate chill facilities and the unsound cold-chains system. China is one of the market leaders in the international commerce of various food and beverage items, and this feature has led to an increase in demand for better cold-chain facilities and services, which has helped the market grow. 

Additionally, Chinese e-commerce giant JD partnered with Mengniu Dairy Co Ltd, China's largest dairy producer, in the cold chain logistics industry in anticipation of the boom anticipated in the Chinese food cold chain market during the projection period. The Japanese logistics industry's modernization has contributed to the market's upward trend. The distribution of food items is quickly moving away from traditional markets and mom-and-pop shops and toward supermarkets and convenience stores. Due to the availability of insulated truck shipments from large distributors, the market for refrigerated and frozen items is now easier to obtain.

Brazil is a significant beef producer and exports a sizeable amount of its agricultural products to other countries, which is greatly aided by the cold chain market. However, in recent years, the meat industry has suffered from possible cold chain failures, forcing the players to struggle to find a solution and develop better services, opening the door for new companies to enter the market and offer improved services. In Brazil, such as SuperFrio and others, cold chain companies specialize in storing and distributing chilled goods. Businesses frequently upgrade their distribution facilities to gain a competitive edge as they grow their firm. International corporations are investing in the developing Argentina cold chain sector because it has the potential to enhance the region's food supply chain, particularly for blueberries and other fruits. Additionally, the Argentine government has strict regulations surrounding food safety, which increases the need for cold chains in the nation to preserve the quality of food goods.

Segmental Analysis

The global food cold chain market is segmented by type and application.

Based on type, the global food cold chain market is bifurcated into cold chain storage, cold chain transport, and monitoring component. 

The cold chain storage segment is the highest contributor to the market and is estimated to grow at a CAGR of 8.57% during the forecast period. Due to the growing worries about food waste, the cold chain has been one of the solutions sought by farmers and agribusinesses. In addition, the storage section of the market analyzed has seen continued expansion. The giant refrigerated warehouse in developing economies is found in India, China, and the United States. These three nations control a large portion of the worldwide cold storage warehousing sector. The expanding prevalence of retail stores in metropolitan areas satisfies the majority of the demand for storage; likewise, the significant presence of warehouses explains the potential export of perishable goods from the nations mentioned above. The rise of the free movement of perishable food goods worldwide has been further boosted by the trend of perishable commodities trade and the governments of numerous economies eliminating trade barriers. However, since developed economies have a high need for cold chains and the environment poses a manufacturing hurdle, imports will continue to be a constant over the foreseeable future.

There is a growing demand for some trade routes that are solely dependent on products with a long cold chain, such as frozen food, seafood, and agricultural produce. On the other hand, the transportation industry has included specialized and potent technology that provides shippers greater sight into their cargo while also considering humidity, light, and other factors in addition to temperature. The transport industry will experience operations using GPS and remote temperature monitoring devices, as well as the integration of AI, as a means of constructing the machine learning infrastructure in the cold chain space as the sector expands. In the long run, automation in the cold chain transportation sector will increase, and services may look to drones as a viable alternative for high-value commodities. Most developing countries are increasing spending on revamping and modernizing their cold chain infrastructure to better safeguard against food losses throughout the production and consumption processes. This is expected to increase demand for logistics services like trucks, cargo, and airplanes, among other things. Additionally, frozen food will compete for shelf space with fresh and natural products due to shifting consumer preferences, making it fully dependent on transportation for timely deliveries.

Based on application, the global food cold chain market is bifurcated into fruits and vegetables, meat and seafood, dairy and frozen desserts, bakery and confectionery, ready-to-eat meals, and other applications. 
The meat and seafood segment owns the highest market and is estimated to grow at a CAGR of 7.96% during the forecast period. The OECD predicts that by 2028, the average global meat consumption per person will rise to 35.1 kg retail weight equivalent, an increase of 0.4 kg from the current situation. To fulfill the anticipated demand, however, export-oriented nations are more likely to invest significantly in cold chain solutions. Although a large population depending on animal protein, such as those living in China, Brazil, and the United States, will be able to meet the demand, the slowdown is expected to come from the expanding vegan and flexitarian populations. The use of cold chain management in meat supply is crucial when considering the maintenance of quality and prolonged safety of such items in shelf spaces because meat and seafood are considered perishable products with limited shelf lives and, consequently, short selling times.

Cold chain solutions are a barrier to perishability for fruits and vegetables during processing, storage, transportation, distribution, and retail. In contrast, such solutions provide appropriate temperatures to ensure quality and reduce loss as much as feasible. China and India, two nations that rely heavily on agricultural exports, have been at the forefront of post-harvest losses for export-driven fruits and vegetables. This is primarily due to relative logistics backwardness, which causes a higher decay rate and fewer circulations. Numerous stakeholders are active in the fruits and vegetable sector in nations like India, but they work alone because the infrastructure to link these partners needs to be fixed. Further, the industry expects this segment to have greater export potential due to rising consumer interest in plant-based products and the importance of cold storage and transportation for perishable foods like fruits and vegetables due to their short shelf lives and need for controlled temperature.

Recent Developments

• April 2022- Lineage Logistics announced the next-generation automated cold storage facility to provide a global food chain hub for JBS USA.
• August 2022- Niagro Nichirei do Brasil Agricola Ltd introduced a New “Acerola Powder” production line —providing markets with fully traceable raw materials.