Showing posts with label India Agricultural Cold Storage Market. Show all posts
Showing posts with label India Agricultural Cold Storage Market. Show all posts

Wednesday, July 12, 2023

How the Indian Government is securing the future of the Agricultural Cold Storage Market in India? : Ken Research

The agriculture sector in India has had consistent growth in production levels over time. This production level hasn't been matched appropriately in terms of food storage, which highlights the Indian Agricultural Cold Storage Industry's existing whitespace. Despite being an agricultural nation, India experiences significant food losses per year that range from INR 90,000 to INR 100,000 as a result of inadequate post-harvest management and a lack of adequate cold storage infrastructure.

The government has been developing numerous programs and giving grants to help, along with special preference to the states that are behind in terms of infrastructure, in an effort to foster development in the agricultural cold storage industry. Here is an overview of all those crucial steps taken by the government to level up the agricultural cold storage market in India.

1. Indian agricultural sector is growing due to favourable climatic and demographic conditions which is creating demand for cold storage facilities in the country

2. Setting up cold storage facilities could aid in development of food processing, packaging industries, coupled with increase in farmer’s income

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3. Indian Government is actively taking initiatives to establish a robust cold chain infrastructure to enhance the farmers’ income by preventing supply chain losses

4. Multiple schemes are implemented on ground to accelerate investment in the cold storage sector

5. Government is also offering support to Cold Storage Industry via Capital Investment Subsidy Scheme, Agricultural Marketing Infrastructure Scheme and Role of NCDC

6. The establishment of Mega Parks is expected to provide a boost to processing & cold storage services.

7. With support from the government and investors, the Indian Agricultural Cold Storage sector looks attractive in the long run

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India Agricultural Cold Storage Industry

Monday, June 12, 2023

With a project allocation of INR 9000 Cr by GOI, massive infrastructure development alongside technological push is expected to boost market growth in the next 5 years: Ken Research

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The Agri-tech market is expected to witness a growth of 32% indicating a well versed adoption rate of technology in cold storage units & modernization of existing ones, says a report by Ken Research

1. Opening up of the sector and technological push is gearing up for unleashing the potential

India Agricultural Cold Storage Sector

Recent Trends in India Agricultural Cold Chain Market

The market is currently experiencing a technological push in terms of increasing technology adoption & modernisation of existing cold storage facilities. Cold storage operators with sound capacity & sizeable operations expressed willingness to upgrade their cold storage rooms with Controlled Atmosphere technology. Given the inherent benefits of technology, cold storage operators are looking to diversify clientele to export partners; fetching higher returns than normal market prices. Moreover, trends like entry of foreign players & increase in contract farming are some of the other trends that are being currently witnessed by the industry.

2. Technological and Warehousing developments could revolutionize the way cold logistics work in India.

India Agricultural Cold Storage Sector

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The market has witnessed increased technology adoption rate with technologies such as Remote monitoring systems (RMS) wherein an all-round check and SLA fulfilment by cold storage operators could be enabled at Wi-Fi enabled smartphone & the system takes away the pain of keeping check of temperature and humidity conditions. Other features such as ‘Portable cold storage solutions’ are also becoming the new trend.

3. The opportunity for technological inclusion in agricultural cold storage sector is anticipated to witness a surge in upcoming years.

India Agricultural Cold Storage Sector

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Trends such as adoption of CA Technology solar power systems & RMS alongside push by COVID-19 has geared up momentum for next 5 years along with the creation of massive opportunity for market growth. Moreover, backward integration by incumbents & rise of agri-tech startups solving industry problems fosters support from ecosystem participants. All in all, rising technological adoption is going to be witnessed in the upcoming years which is then expected to boost industry growth.

Wednesday, June 7, 2023

Government initiatives such as PM-KSY are expected to result in the capacity expansion of 6.5 Mn MT in the next 5 years: Ken Research

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Total project Outlay of INR 9000 initiated by GOI towards infrastructure development is expected to boost the Indian Agricultural cold storage market growth in the next 5 years, says a report by Ken Research

1. “Favorable Policies:” Growth of agricultural sector is driven by favorable policies towards the farming population in India

Recent Trends in India Agricultural Cold Storage Industry

A massive stream of support has been given to the agricultural ecosystem in India including the cold chain industry via Capital Investment Subsidy Scheme, Agricultural Marketing Infrastructure Scheme and Role of NCDC. Government Schemes such as PM Kisan Sampada Yojana wherein integrated cold chain & value addition infrastructure have been added with the objective of reducing post-harvest losses of horticulture & non-horticulture produce & providing remunerative price to farmers for their produce. In a similar way, capital investment subsidy investment scheme has been introduced with the objective of creation of 12 lakh tonnes of new cold storages and modernization/rehabilitation of 8 lakh tonnes of existing cold storages.

2. “Investment boost:” Multiple schemes are implemented on ground to accelerate investment in the sector

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A total of 325 projects (214 completed and 111 on-going) are operational in various parts of India. With a total project outlay of INR 9000 Cr, government of India has approved a cumulative grant –in aid of INR 2,478 Cr via its various schemes under MOFPI & NHB. These projects are mainly being undertaken in Fruits & Vegetables, Marine, Fisheries, Diary and Irradiation sectors in Tier II/III cities of the country. Release of this type of data as well as positive feedback from new unit operators further emboldens the confidence in govt.

3. With increasing government initiatives & rising investment scenario from private entities, the sector looks attractive in the long run

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Cold storage units provide aid in getting better prices of crop produce to farmers by providing cooling solutions. Further, storage units near export zones has allowed generated export receipts from domestic crop produce. During 2010-20, establishments of new cold storage units led to substantial reduction in post-harvest losses. Presence of cold storage units has enabled backward integration by food processing firms undertaking massive contract farming of Potato. In the upcoming years, it is expected that an increased investment from government & private entities will boost the market growth. The market is expected to register a market growth of 3.2% in the upcoming years.

Wednesday, March 22, 2023

Growing food processing industry, shift in cropping patterns to horticulture, and Proactive Govt. Policies and Financing Support will propel the growth of the Indian Agricultural Cold Storage Market: Ken Research

 1. Cold storage capacity has increased year on year, however, there is a lack of modern storage facilities that hold back the industry’s extreme growth.

India Agricultural Cold Storage Market

The cold storage sector in India is driven by the increase in international trade because of liberalization in trade. Also, with the push by the government via various incentive-led schemes and recommendations of NCCD (2015), the number of cold storage units increased dynamically in August 2020. Although the highest number of units are concentrated in Uttar Pradesh, the top 5 states contribute >75% to total Indian capacity. This highlights the focus to ensure a well-distributed mechanism in India. Moreover, more than 80% of units are decades old in nature and lack modern techniques for storing more commodities, temperature control methods, etc. which inhibits the growth of the cold storage industry.

2. Inadequate capacity for multi-storage, high Opex, long gestation period & small unorganized players are some of the other pain points of this industry.

India Agricultural Cold Storage Market Revenue

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While the cold storage capacity has increased at a CAGR of ~4.8% during 2010-20, it is still behind the capacity of New Zealand, the USA, and Great Britain in terms of availability per urban resident in cubic meters. There can be many reasons for it. One of them is the inadequate capacity for multi-storage. Around 68% of its capacity is suitable for potato storage only which makes it an economically not so-viable option in bumper years of production.

Also, only 20% of revenues of the cold chain sector are generated from Potato while the multi-purpose sector increases the capacity utilization rate and contributes 54% to total revenue. Moreover, the presence of small independent private players has restricted the growth of the industry as these players do not possess the required monetary backing for undertaking capacity expansion, technological advancements across cold chains, procuring reefer trucks, setting up mobile units, etc. Also, the low availability of skilled staff at economically viable rates increases the Opex.

3. Opening up of the sector and technological push is gearing up for unleashing the potential of the cold storage market in India.

India Agricultural Cold Storage Market Share

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Despite having challenges, the industry is expected to grow in the future as multiple factors are working together to boost growth. One of them is the surge in the adoption of CA Technology. Cold storage operators with sound capacity & sizeable operations expressed willingness to upgrade their cold storage rooms with Controlled Atmosphere technology. Given the inherent benefits of technology, cold storage operators are looking to diversify clientele to export partners; fetching higher returns than normal market prices.

In addition to this, in 2020, Mumbai airport became the world’s largest airport-based temperature-controlled facility with a capacity of stock holding up to 700 tonnes at a time. Railways of India has been undertaking multiple steps via CONCOR & subsidiaries to establish/ operate cold storage units in various states. Entry of new players, increase in contract farming, and backward integration are some of the other trends and development in the industry.

Tuesday, November 9, 2021

India Agricultural Cold Storage Industry Outlook 2025: Ken Research

The publication titled Agricultural Cold Storage Industry of India depicts the snapshot of agriculture in India with core focus on identifying problems at the post-harvest management processes which costs around INR XX Billion (in economic value losses) per annum. Analysts have mapped out the landscape of cold storage industry, skewness in capacity concentration at certain regions, growth drivers, opportunities and challenges restraining the growth till full potential.

Overview of Cold Storage Industry

While the capacity of cold storage solutions has improved considerably at an aggregate level (XX Mn MT in 2020), there is a lack of cold chain infrastructure at farm-gate and transportation level.  Snapshots on cold storage solutions of top 5 capacity states – Uttar Pradesh, West Bengal, Gujarat, Punjab and Andhra Pradesh and certain select states – Maharashtra, J&K & Himachal Pradesh, further indicate the inefficiencies as a single commodity storage unit and emphasize on lack of modern technology (controlled atmosphere, pre-conditioning rooms) of such units.

Drivers and Impediments to growth

While growing food processing industry, rising urbanization and shift in cropping patterns to horticulture are key growth drivers for uptake in demand for cold storage solutions; challenges such as inadequate capacity for multi-storage, high opex, long gestation period & small unorganized players hinder the growth of industry. At a generic level, it takes 5+ years for a cold storage operator to break even with an initial investment of INR XX Mn to set up a unit of XX MT capacity.

Active Participation by Union and State Government

Being a capital-intensive business directly impacting 100 Mn+ farming households, Government of India along with state governments have taken pertinent steps to improve the ‘capacity availability’ situation of cold storage units via various schemes. These schemes include PM Kisan Sampada Yojana, Mission for Integrated Development of Horticulture, establishment of NCDC, schemes by APEDA for registered exporters, Capital Investment Subsidy Scheme for Horticulture, Agricultural Marketing Infrastructure Scheme, and Agri-reform laws - The Farmers’ Produce Trade and Commerce (Promotion and Facilitation, Essential Commodities Act (Amendment) and The Farmers Agreement of Price Assurance and Farm Services Act. As on 31st January 2021, XX cold storage projects (XX completed and XX on-going) were operational in various parts of India with Maharashtra having XX projects in pipeline.

A Promising Future Outlook

With maturing Agri-tech ecosystem, increasing traction from start-ups solving farm gate challenges and adoption of technological developments; analysts at Ken Research estimate an addition of XX Mn MT capacity in next five years with an aggregate capacity of XX Mn MT by 2025. The report concludes with highlighting attractiveness of opportunities at farm-gate level coupled with mitigation of short-term challenges which could result in a sound business model emanating from synergies in value chain ownership.

Key Topics Covered in the Report: -

Snapshot of Agriculture in India (State wise Production statistics of Cereals, Horticulture, Meat, Livestock and Poultry)

Situation of Farmers in India (Profile of Farmer, Role in Value Chain, Problems and Issues faced in storage of produce)

Overview and Segmentation of Cold Storage Units (By Storage Temperature, Technology, Regional & State wise Distribution)

Demand side and Supply side Indicators of Cold Storage Solutions

Growth Drivers and Challenges to growth of Cold Storage Industry

Cold Storage Demand-Supply Profile of Key States – Uttar Pradesh, West Bengal, Gujarat, Punjab and Andhra Pradesh, Maharashtra, J&K and Himachal Pradesh

Trends and Developments

Union and State Government Support to Cold Storage Sector

Impact of COVID-19 and Future Outlook of Industry

Business Attractiveness at Farm gate level

Recommendations for operating Sustainable Business

For More Information, refer to below link:-

India Agricultural Cold Storage Industry

Related Reports:-

India Agritech Market Outlook to FY’2025-By Nature of Services (Input Market Linkage & Farming as a Service, Supply Chain, Post-Harvest Management & Output Market Linkage, Precision Farming, Advisory & Analytics and Agri Fintech)

Business Potential for Cold Storage Facility in JNPT Outlook to FY25 – Driven by increasing Trade of Food Products and Pharmaceuticals along with growth in QSR

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