Moving TEMPERATURE sensitive cargo responsibly
Maintaining the quality of temperature sensitive and perishable cargo across the cold chain is challenging in India owing to several issues relating to infrastructure, efficiency of human resources and geographical distribution of cold storage systems
Maintaining the quality of temperature sensitive and perishable cargo across the cold chain is challenging in India
Cold chain industry has evolved over the years and has played a crucial role in helping other industries thrive, ultimately boosting the Indian economy. Indian Cold Chain industry is expected to grow at a CAGR of 28 per cent, over the next 4 years and reach a market size of $13 billion in 2017 – 2018, through increased investments, modernization of existing facilities, and establishment of new ventures, via private and government partnerships. The Indian cold chain market is highly fragmented with more than 3,500 companies in the whole value system, with organized players contributing 8–10 per cent of the cold chain industry market. However, the market is gradually
getting organised and focus towards multi-purpose cold storages is rising.
Indian cold chain sector – Expected growth
A fast-paced lifestyle, changing eating habits, higher purchasing power of consumers are not only fuelling expansion and growth of quick service restaurants (QSRS) across India, but also of the cold chain logistics industry, which helps food reach fast and fresh. The market for chain restaurants including cafes and QSR is expected to grow at 20 per cent a year to reach `51,000 crore ($8bn) by 2021. Cold Chain plays a key role in supplying food quick and fresh, enabling QSR Industry to meet the growing demand. The biggest challenge faced by any
QSR in Indian market, be it a domestic or an international player is to maintain consistency of the product and quality of service across various outlets. The QSR focuses on providing standardization in both product and experience.
Challenges in the reefer transportation
One of the crucial aspects of cold chain logistics is to have a seamless refrigerated transportation network. 32 per cent of refrigerated cargo loaded onto refrigerated vehicles is at the wrong temperature at the time of loading. Many times, cargo is left sitting too long on the loading dock, and the carrier runs the risk of the load being rejected by the receiver. Transport refrigeration units are not designed to alter the temperature of the cargo; they are designed to maintain the cargo at the loaded temperature. If transport refrigeration unit fails, the sensitive cargo is at risk.
Quality cold warehouse infrastructure
Nearly 75 per cent of the cold storage infrastructure created in the past is suitable only to store single commodity, rendering them futile for utilizing for the multi temperature and multi commodity storage.
In India, the supply chain of products is quite long and fragmented, given the lack of awareness of labourers in handling temperature-controlled products. Most resources are not suitably trained. Cold chain industry consists of multiple players, of which, 85 per cent constitute the unorganized players, who are unable to invest much in the technology required, to build high quality cold storages, along with reefer trucks.
Uneven distribution of cold storage
The uneven distribution of capacities of the existing cold storages, where only single commodities can be stored are a major issue. The majority of cold storages in India have been established in states like Uttar Pradesh, Uttarakhand, Maharashtra, Gujarat, Punjab and West Bengal. But the establishment of such cold storages needs to be more geographically diverse and uniform.
Electricity availability & Pan-india supply
Currently, India faces about 9 per cent of peak power deficit, which enforces the use of fuel based operations, leading to a marked increase in operating costs. The majority of electricity deficiency and unavailability could be found in the major agrarian states of the country, having a significant percentage of cold storages.
Recommendations for way forward Infrastructure creation & management
Infrastructure creation in the cold chain sector has been identified as an important factor for growth and is receiving a fair amount of support from the government. A holistic approach to addressing all the stages of the supply chain needs to be considered. India has a well-connected railway network, with a fair share of it, covered under stable power grid. This can be used for increasing the connectivity of the reefer transportation. Development of more perishable cargo centres in the key localities, making available enough reefer containers with grid connectivity and priority in clearing the trains carrying perishable cargo are the key intents required to make this actionable.
Cold chain companies are instrumental in adopting the latest technologies, but the lack of prior data about produce with the fragmented supply chain, is hindering in realizing the advantage of cold chain completely. On technology front, the following aspects are to be taken up:
• Promotion of research and development of low cost technologies to address the glitches of local supply chains.
• Developing the monitoring and tracking models with technologies like WSN and IOT, representing the local conditions, is the need of the hour.
• Low cost and small capacity reefer trucks with technologies like PCM’S are to be developed to connect the difficult areas.
• Transfer of technology should be assisted with small and large scale demonstration projects and fiscal incentives.
Cold chain sector is receiving the best policy support from multiple agencies like MOFPI, NHB, APEDA, State governments etc. It is immensely important that a focused effort is required on part of the government to encourage the use of cold chain, among market participants. Fine tuning of support is required on the following aspects:
• Provide required support like funds for setting up cold chain infrastructure facilities.
• Creating awareness campaign and educating market participant about the importance of cold chain facilities.
• State governments can encourage setting up of cold storage facilities by providing subsidized power tariff, as power forms a significant proportion of the operating cost.
• Support should be extended to local companies in the development of technologies like RFID, WSN, and IOT.
Food safety regulation
Product and storage standards are clearly laid for frozen foods and other temperature sensitive foods by FSSAI. But there is no clear understanding about the food safety risks of frozen or temperature sensitive foods in the supply chain. There is a need for developing product/ product group specific guidelines and importantly, risk mitigation plans for food safety hazards arising from supply chain failures.