Cold Chain Prospects in India

ice- polar cooking stove Prospects in IndiaA frozen memory board stove is a temperature-controlled hand over concatenation. An unbroken rimy scope is an uninterrupted series of w behouse and distri moreoverion activities which maintain a give temperature range. It is apply to help lengthen and make sure the shelf emotional state of products much(prenominal) as marine products, frozen, fresh agricultural produce, photographic film, pharmaceutic drugs and chemicals. The orbit needs to begin at the production/farm take aim (e.g. harvest methods, preprocessing, Pre-cooling) and cover up to the consumer level or at least to the retail level. A headspring managed nipping chain trim backs spoilage, retains the caliber of the spoilable products and guarantees a cost efficient deli real to the consumer given adequate maintenance for customer assistant. The main characteristic of the chain is that if any of the links is wanting or is weak, the whole system fails.The inse nsate chain logistics and offer chain management systems stem generally consists ofPre-cooling facilitiesRefrige consecrated Carrier dust-covered Storages entrepotPackagingInformation Management systems (Traceability and Tracking etc.)Fig Outline of a typical nippyness ChainSome Snaps of rawness shopsGlobal position AnalysisTo daytime shippers of destructible products face an array of challenges in acquire their products to grocery in the most efficient and cost effective manner, notwithstanding escape of substance in the logistics and w arhouse religious service manufacturing isnt mavin of them. The need for temperature controlled retentiveness systems for storing both solid sustenance for thought and non food is increasing in many an otherwise(prenominal) traditionalistic and emerging grocery stores worldwide. The producers and retailers argon moving to emerging markets desire Latin America and Asia, along with the changing preferences and tastes of custome rs in older market places, is having a strong impact on the logistics perseverance. This has led to amply levels of enthronement by logistics companies and their associated suppliers as they set outThey reserve gone for acquisition or entered into alliance with local companies for getting access to these marketsThey pull in realised frigidness transshipment center enabled operations in the atomic number 18as to serve the growth in rankness of local consumersSimultaneously, demand for destructible products from these emerging markets is increasing, with a higher level of both perishable food and non food products existence transported to the more traditional western markets of the US and Europe. This is causing problem on the already jam-packed rapture routes .Increasing volumes atomic number 18 leading to congestion issues at major ports of the world. common ice- coldness chain industry is presentation tremendous increase in France, Germany, the Nether enters, Spain and Brazil. Total message for these countries for 2008 is 6,350.32 cardinal cubic feet (179.82 one million million cubic meters).The industry is increment globally at approximately 15 percent (IARW Report 2009).The growth rate for China and India argon higher comp ard to global average. Both have nigh doubled their capacity in last ten social classsA phenomenal transformation is currently occurring that may epochally affect a multi-billion dollar global chilly chain industry. The projected annual wastage of perishable products worldwide is 35 billion dollars. There are enormous opportunities for companies to fork themselves in the market place through effectively leveraging the forth glide slope technologies that improve logistics and supply bonds. Most agri avocationes and Consumer Packaged Goods (CPG) companies are not vindicatory considering process improvements of their logistics and supply chains but they are investing in and overhauling the entire business model a nd strategies to survive in the continuously changing competitive environment. Especially for manufacturing and retailing companies handling temperature pure food and non food products, the substantial challenges may be empha size of itd by the additional cold-chain logistics winding with effectively preserving and handling these products. opposite converging and substantial problems such as fierce competition, strict government regulations and global standards for product identification, security, and tagging and the need for intensify traceability to improve quality and operations are influencing all important(predicate) transformation in the Retail and CPG industry. The implications of resisting these deepens and other related upcoming challenges are probablely upset delivery channels and a weakened competitive position. By al menialing culture computing power available anywhere and any term, companies can more readily adjust to these challenges and the continuously cha nging external environment. A constituent from this, they can intimately improve what they deliver, how they operate, and potentially their profitability.Indian Situation AnalysisThe Indian cold chain industry is very large and estimated to be well-nigh Rs 10,000 to 15,000crore, which is growing at a rate of about 20-25 percent and is expected to shade Rs 40,000crore by 2015.It was about a century ago this perseverance came into existence. In India majority of cold warehousing facilities are below-utilized or completely refreshing for most of the year. There is a large disturbance of rough 60% in cold storage radix and 80% in supple cold storage facilities analogous refrigerated trucks and rail wagons. By the year 2012, the cold chain industry expects to see a huge capacity addition as there is an expected increase in the cold storage investment.Current status of cold storages in IndiaThe cold storage infrastructure in India was built way back in mid-sixties mainly for p otatoes and potato seeds and even the investments in cold storage were very less during that time. Nationwide put forwardr of cold storage facilities is nonexistent at that time. The number of cold storages in India is about 5316 and the tot capacity is around 23333694 mTs. The number of Private sector cold storages in India narration for 4820 with a capacity of 222343607mTs, cooperative sector 363 numbers with 989445 mTs, Public sector account for 133 numbers with a capacity of 100642 mTs. The existent cold storage facilities mainly serve the potato products. There is a lack of facilities such as cold storage vegetable, cold storage fruits, cold storage tamarind, cold storage fish, cold storage meat, and cold storage take out and dairy farm products.. Cold storage services are available for only 10% of the produce. In India shipping of fruit and vegetables through cold chain is approximately negligible, whereas in US it is around 80-85% in the US and for Thailand it is around 30-40%. In India, due to the current inefficiencies in the supply chain around Rs 1 lakh crore value of fruits and vegetables are wasted every year.Cold chain in India -RealityModern Post Harvest Management is non existent neglect of World Class co-ordinated Cold Supply Chain crossways the Country and also Isolated Stores without Logistics SupportUsing Services of Cold Stores with Archaic Storage TechnologyThe cold storage facilities are used mainly for low value products like potatoesThe present cold storage facilities lead to Loss of quality and hence value of the perishablesThe duration time for storage largely influenced by the market imbalancesIndia cold chains potential and opportunitiesIndia is the second largest producer of fruits and vegetables in the world which contributes for about 10% of the total fruit production in the world. India is the largest producer of fruits (32mT anually) in the world, which is about 8 per cent of the global production India is also the se cond largest producer of vegetables in the world (first creation China), producing around 71 mT anually, which is about 15% share in the world market. The key area in India is forage processing and it processes about 1.3% of its total fruits and vegetable where as it is 80% in USA, 70% in France, 80% in Malaysia and 30% in Thailand. To cash in ones chips a top exporter and processor of fruits and vegetables, India needs a high quality cold chain. Due to lack of cold storage facilities and energy infrastructure about 40 percent of the fruits and vegetables grown in India (40 mT worth $13 billion) gets wasted every year, which is huge enough to feed countries like Brazil and Vietnam.The reason for this huge wastage is the wide gaps that are alert in the cold chain and there is no well equipped cold chain for the preservation of fruits and vegetables. The Infrastructure for Cold chain is not subsisting for the produced capacities and same is the case with storage, also these close storage facilities are not available close to the farms, in addition to these the superman (temperature controlled) is also inefficient. So it is important to establish world class cold storage logistics, which summercater a crucial role in reducing the global foods shortfall by eliminating wastages, which would provide us enough scope to feed many parts of the world.The major initiatives which government of India has taken to improve this sector areAllowing 100% Foreign direct InvestmentProvided full excise responsibility exemption on cold chain refrigeration equipment (consisting of compressor, condenser units, evaporator), which trim down the costs substantially by around 16%.These constitution initiatives taken by the government have signalled the existing cold chain big league in India to setup their own back-end logistics.Existing Players in IndiaThe Leading Cold chain companies in India with established cold chain infrastructure are as followsContainer Corporation of I ndia (Concor),Indraprastha Cold Chain,Glacio Cold Chain.Bulaki Deep FreezeSnowmanRefcon CarriersKausarGatia opening DistiparksR.K. FoodlandAdani convocationFuture GroupBhartiITCRelianceGodrejTataCochin. Mumbai, Delhi international dromesAditya Birla GroupApollo Everest kool SolutionsThe existing players are taking major pure tones in expanding their capacities, which are as followsSnowman and Kausar, two major names in the cold chain Industry have been bought over. Gatia ,a logistics company in Hyderabad acquired Kausar India, Gateway Distiparks, the Transportation logistics major acquired a controlling stake in Snowman Frozen Foods.The Future Group has carried receding(prenominal) integration, from food retailing to storage and transportation with the launch of Future Logistics. Ahmadabad base Adani Group revamped its cold chain logistics facilities recently. Major players like Bharti, ITC, Reliance, Aditya Birla Group, Bharti the Godrejs, the Tatas and the Future Group has announced billion dollar investments which offer a ready market for third-party cold chain logistics players. Apart from the Global giants and the Indian corporate the airport infrastructure companies and the railways are also readiness to build refrigerated warehouses and perishable products cargo centres across the country in capture the share in the booming retail sector.The major airports like Cochin International Airport, Mumbai International Airport, Delhi International Airport and Greenfield international airport projects such as Bangalore and Hyderabad are also setting up refrigerated warehouses for perishable cargoes next to the airports and started to beleaguer the cold chain market. Cochin International Airport is building a state-of-the-art centre for perishable cargo, which can handle about 40,000 million tonnes perishable cargo annually and which would help the farmers of the state who are cultivating such products.Apollo Everest Kool Solutions, which is a joint vent ure of spire Group and Apollo has plans to set up at least 15 temperature-controlled warehouses in India. The other major companies showing interest in cold chain market in India entangle Snowman Frozen Foods (sold out), a joint venture between, Nichirei Logistics Group, Mitsubishi Corp Gateway Distiparks. angelical and Healthy Enterprises has set up a 100 per cent underling for cold chain logistics with an initial capacity of 12,000 tonnes at Rai in Sonepat, Haryana and has pass on plans to expand it to over a dozen cold storages in the skilful future, Apollo-Everest Cool Solutions a joint venture formed by the Delhi-based Apollo Tyres and the Spire Group of Canada have plans to construct 15 temperature-controlled warehouses in India with an investment of $250 million Adani Agrifresh one of the Top retail chain sold its retail business to start a cold storage supply chain for fruits and vegetables in over a dozen top cities of the country.Cold Chains in Different IndustriesS pecial features of Indian Cold chain market for important product segments are given in the table below.ProductCharacteristics murphy Amounts upto 90% of existing cold storage capacityChocolate extravagantly outsourcing demand. Seasonal-Large variation in peak and non-peak demand. No dominant player among service providers bird All the market is captured by Snowman and RK Food-both pan India playersFruits Vegetables Predictable, Stable and heights demand end-to-end the year. No dominant player in the market. merchandise dominated by Domestic players. More than 60% demand met by slight/ local/regional playersDairy products(Butter Cheese) High demand throughout the year. Major players not very active Significant share of beautiful playersIce Cream-Seasonal High demand in peak assuage High growth 35% demand shared by small playersThe major products are Potato, apple which contributes Rs 16050 million to the cold chain market.Other products areSegmentValue(Million)Imported Fres h Fruits Vegetables1.67Exports By sea (Seafood, Meat, Poultry, Fruits Vegetables)46Chocolate Industry2Dairy Industry2.67Meat Poultry ( municipal)1.33Ice-cream Industry4.9 offshooted potato4.45Emerging segments (flavoured milk/yoghurt)13.33Cool Chain Transportation40Source Global AgriSystem LtdCold Chain in Pharmaceutical IndustryIn the pharmaceutic supply chain, the chain members have antithetical requirements to meet for material handling, warehousing, storing, packaging and distributing the pharmaceutical products which are sensitive to the environment. The ideal pharmaceutical cold chain should be capable of transaction with changing product portfolios, the requirements for Good Storage and dissemination Practices, current restrictive trends, quality management, risk assessment factors, and temperature observe.Pharmaceutical cold chain trendsManufacturers are being held responsible for any defects in the product in cold chain management. E.g. determining, maintaining and m onitoring temperature levels during encumbrance.The management and control of environmental factors across the supply chain is being given greater emphasis. E.g. Vacuum packaging , Transportation choices in cold chain, etc.Temperature control and monitoring is being diligent to reduce the risks and increase efficiency. 36% of all major and critical defects registered by the Medicines and Healthcare Products Regulatory Agency during 2003/2004 were related to the control and monitoring of storage and transportation temperatures.Heightened priority of patient safety due to the presence of binary uncontrolled variables in the distribution process, spliting an appropriate temperature and humidity monitoring program is essential to protect the quality of environmentally sensitive pharmaceutical product and ensure patient safety.Increased Importance of the Pharmaceutical Cold ChainIn 2003, out of the $400 billion products, 10% were biopharmaceuticals.The biopharmaceutical markets shar pen annual growth rate(CAGR) was 21% which was notably more than the roughly 11% CAGR of the traditional pharmaceutical market in the period 1999 to 2003The biopharmaceuticals are exceedingly sensitive to temperature. This increases the importance of the pharmaceutical cold chain.The standard procedures normally followed in the cold chain areInformation of shipping configuration and the figure of packaging used, should be declared.In the labeling part, the storage rules and particular precaution that should be taken should be included.Mode of transportation should be approved by respective authorities.The finished products in the shipment are verified to hold up any tampering or damaging of the containers.The manufacturer should obtain the certify that the requirements for shipping e.g. temperature control have been fulfill.Some important aspects of Pharmaceutical cold chain areSome leading logistics companies and carriers which have sophisticated infrastructure e.g. electronic tracking, online export documentation provide can assists the shipping party.In cold chain, the use of refrigerated warehouses, refrigerator trucks, refrigerated containers, refrigerated ships and refrigerator cars is common.Another important facility required is the insulated shipping containers or other specialized packaging.The role of Temperature data loggers and RFID tags is to help monitor the temperature history of the warehouse or truck etc. and also the temperature history of the product being shipped. They also help in determination of the remaining shelf sustenance of product.The key part is documentation. There are set of rules for each step in the chain to maintain proper ledgers. Incomplete or outside paperwork in customs can lead to delays. So all the established protocols should be followed e.g. number of copies and other information details.Quality Management Process (QMP) and Risk Assessment Process (RAP)Factors to be considered for the QMP may include but are n ot limited to the Organization, roles and responsibilities, process, trained resources, implementation plan, compliance change control, on-time delivery of right product, quality metrics, continuous enhancements, and monitoring customer satisfaction.Areas to be assessed in RAP include Compliance with regulations, guidances and quality standards product profile, physiological and chemical stability environment (temperatureMapping, temperature control, temperature and humidity monitoring), mode of transportation (ground, air, sea), shipment destination (domestic, export), package (primary and secondary), people (standard operating procedure, training, communication, documentation, recognizing, addressing, correcting adverse events, and change controls).TMS- Temperature monitor SystemThe determining factor of a temperature monitoring system (chemical, mechanic or electronic) is the amount of information required. Generally the temperature monitor equipment is the main part of the Col d chain system. If the suppliers are having the infrastructure for high quality checks, the flying may use more complex, precise and sophisticated temperature data loggers which provide all the relevant information in prescribed format. The data includes record of temperature and humidity including time and date as well as special(prenominal) identification.All equipment used for recording, monitoring and maintaining temperature and humidity conditions should initially be formalise and thereafter calibrated on a regular basis. The certifications are provided by the leading suppliers in the industry indicating the grades about the quality required for the monitoring.Cold Chain in Floriculture IndustryFlowers are perishable in nature. It is observed that small temperature differences can bring about very significant flower quality changes. There is a negative effect on the useful life of the flowers with the increase in temperature in transportation. It is further unnatural by inc rease in the duration for which the flowers were exposed to such high temperature. In India, due to inadequate cold-chain management, the postharvest losings are very high. The estimated losses are 40%, depending upon the commodity at various stages. Flowers should be cooled to temperature ranging in 330 F to 410 F without any delay. Higher temperatures not only reduce the useful-life but also increase the respiration-rate. It is found that the respiration of cut flowers increase exponentially with increase in storage temperature. Proper cold-chain management of flowers improves the flowers marketability. Cold storage enables quality stems to be held for endless periods before sale and ensures that the flowers steady have a good shelf life(called as vase life ) when they range the market-place.Cold Chain in Dairy Industry Amul Case interpretLife cycles of various product lines of Amul are different, for example products like milk, lassi and flavored milk needs to be refrigerated from procurement, processing to end distribution stage. take out is procured from regional cooperative societies or contract procurers. Pasteurization, refrigeration and packaging are done in regional centers itself. These centers are fully owned by Amul in some places and outsourced in other places. Thirty to forty SKUs of box milk, flavored milk and other similar products are supplied in plastic crates filled with ice for end mile distribution to the nearest market i.e. different parts of cities, suburbs and even to rural areas. Since crates are small loading and set down is done manually, so it does not require complex equipments. Empty crates are brought back as a part of Reverse Logistics for next day dispatching of milk. For ice creams, Srikhand, Butter and other such products High-Tech refrigerated transportation system is used. Amul is first mover in India for tetra packed milk products. It sells these under the brands Amul Sakthi and Nutramul. It has also introduced prod ucts like cold coffe, butter milk and Lassi in tetra packs. These have a life span of six months to one year. These do not require cold storage facilities and delivered in corrugated boxes in combine with stretched plastic. Amul has the largest cold storage network in India (more than 18000 facilities).Challenges IssuesCold storage industry is facing following challenges1. Lack of Uniform Technology standards There is lack of reproducible electronic and bar code standards. International standards vary widely, and domestic standards are almost as disparate, creating unnecessary paperwork and profit-eating delays.2. Consolidation The trend toward desegregation sprung from the growing tendency for warehouses to act as shipping venues, as well as the entry into the market by warehouse holders. Though desegregation spurred overall industry growth, smaller warehouses have struggled to compete with larger industry players.3. bang-up Investment and Technology The cold chain Storage an d logistics is a capital-intensive industry (investment for refrigeration equipments and real estate) with a large capacity cold storage chain has a high payback period of around five years. 4. Incumbency advantages independent of size Existing players like Snowman have built expertise by operating in this industry for longer periods in time use imported hi-tech equipment, which new entrants materialize difficult.5. Economies of scales It is a largely untapped, fragmented full of unorganized small size players. No player has achieved economies of scale and thus a new a new entrant with deep pockets can enter this industry and hitherto be at a major cost advantage.6. Human Capital and Domain Skills It requires skilled human resources for operating and controlling the cold storage facilities. Lack of technically qualified employees is also one of the hindering factors for Indian cold storage industry.7. Lack of logistical Support Small land holdings remain a challenge because it r equires multiple farm gate accrual centers. Also Fragmented cold chain industry has not back up the growth of cold logistics for horticulture produce. Standard refrigerated systems are inefficient and gravely designed. Also, domestic market for fresh perishable produce is underdeveloped.8. Uneven Distribution of cold stores Available capacity is mostly focused on mavin commodities. Problem of financial viability is also their due to seasonality.Other pertinent issues are1. Erratic power supply2. High operational costs and low yield models.3. High insurance/ Risk coverage premiums.4. Large gap in demand supply conducive to small unorganized service providers.5. Government tax and commercial regulations.Role of GovernmentGovernment policy acts as a catalyst in this industry. Following are the striking features of Government policies for cold storage sector1. Encourages Investments Agri food is identified as priority sector.2. Encourages organized sector- ECB route opened, Impor t duty relaxed.3. Liberalizes Marketing Norms- snap on increased retail, improved supply chain.4. Rationalizes Tax Laws- Moving towards uniform VAT/GST.5. Provides Grants and subsidies- VG funding, Grants, Infrastructure status6. Eases foreign investment- 100% FDI in food sector. ECB for cold chain.Government of India Initiatives1. Excised waved on FV, meat preparations, ice-cream, other RTE food mixes.2. robotic approval for 100% foreign equity in processed food items. External commercial borrowing opened (except in beer, alcohol etc.)3. precedence lending status Duties reduced on imports Zero service tax on installations.4. EOI floated for 30 mega food parks- allocated US $ 1.02 billion by 2012. bearing of the scheme is to provide backward and forward linkages as well develop reliable and sustainable supply chain.5. GOI initiating National Highway growing computer program and partnering with Indian railways to establish cold chain infrastructure. Indian railway is planning t o invite private parties to run refrigerated container trains for transporting agricultural products across the country.6. Integrated food law(FSSA) notified and ready for implementation.7. Task force on Development of cold chain established and national centre for Cold Chain Development (NCCD).In Budget 2011- Cold chain IndustryIndustries like fertiliser and cold-storage chains will benefit, with capital investment in fertilizer being treated as infrastructure investment. Hyderabad based express distribution and supply chain solutions provider Gati logistics has said the endowment of infrastructure status to cold-storage chains logistics in the Budget will help in realizing its plans to build cold storage units across the country. Gati is setting up 10 cold storage plants across the India at an investment of about Rs 200 crore in the coming four years.