The Global Cold Chain Expo, held for the first time in Chicago last 20-22 June, was the one’stop shop for innovation, education and business-to-business networking for the global food industry cold chain.
Organised by the Global Cold Chain Alliance (GCCA), the event attracted more than 165 exhibitors and 15,000 key decision makers from retail, foodservice, processing, production, distribution, logistics and transportation. The attendees represented frozen, refrigerated, ambient and fresh operations, while the educational conference brought together innovators and experts with senior management and rising managers from all sectors of the industry.
As a partnership between GCCA and United Fresh, the GCCE was co-located with FMI Connect, the International Floriculture Expo, and the United Fresh Show. For the first time, the GCCE gave the perfect opportunity to spotlight the cold chain industry and its role as a critical component in feeding the world’s ever-growing population, all while maintaining food safety and quality between farmers and consumers.
Top 25 cold store operators handle 85% of the capacity
According to Corey Rosenbusch, GCCA president and CEO, the top 25 cold store operators represent about 85% of the storage capacity in the US, while another 300 operators take up the remaining 15%. Among the fastest’growing groups is Agro-Merchants, which has acquired 19 independent family businesses around the world over the last 3 years. Its total capacity comes to 219 million square feet.
Overall occupancy of cold stores around the world reached 83% in 2015, which is considered by GCCA to be quite high. Quizzed during the panel session of the conference about where the growing opportunities are, Rosenbusch considers the immense potential demand outside US such as China, despite local traditional facilities having a cost of just 30% of modern facilities. “80% of global growth in cold storage is outside the US,” said Rosenbusch. Indeed, 44% of US cold chain operators have operations outside the US and are slowly growing.
Panama Canal open since 26 June
According to a joint study by The Boston Consulting Group and CH Robinson, about 10%-15% of the traffic in produce shipments is due to move from the west coast to the east coast in the years up to 2020. West coast ports will still handle more traffic than they do today, but their market share will likely fall. A battleground representing 15% of GDP will be in play between the west coast and east coast ports, from New Orleans in the south to Chicago in the north.
Stable growth in the rest of the world
According to Manuel Cabrera-Kábana, GCCA board member and director of Friopuerto, the other continents are facing slow but stable growth in cold storage and transport activities. “Europe is mainly renovating its cold store facilities for more efficiency, due to high energy and labour costs,” Cabrera said.
Poland is a particular case where we shall see more consolidation, since there is over-capacity and high fragmentation among the operators. “In Africa, we see growth in more stable countries like Morocco and Senegal, while in Algeria a new financial programme is being applied to incentivize business.”
Cabrera confirms growth with Latin America, both on the east and west coast, since a lot of fruit and protein is coming from those countries. “Mexico is still investing in more capacity, but not exporting as much as they could,” says Cabrera. He concludes that a free trade agreement between Europe and the US would have a big impact on perishable trade, since milk, meat and poultry markets are still protected.
Asia’s big potential: the case of the Philippines
The Asia trade agreement in place within 26 countries will help to fuel growth in the Asian region. Anthony Dizon, president of CCAP and Kolstor Centre Philippines, confirms the tremendous potential in the Philippines, which has 8% annual growth in its cold store capacities. Ongoing projects come to 20,000 tons.
The population has a projection of 108 million by 2020, due to annual growth of 1.8%. The GDP has one of the highest growth rates in South East Asia: around 6%. Frozen items like beef have big growth potential, since its per capita consumption is just 5 kg, compared to 25 kg for chicken. Nonetheless, the complexity of operations limits automation and flexibility, when more than 7,000 different temperature-controlled items are distributed in the country.