Projected Market Value of the Vietnam Cold Chain Market over US $ 440 Mn by 2025.
- Vietnam’s cold storage industry to achieve over US $ 440 market value.
- Limited cold storage warehouses, low adoption by domestic food manufacturers.
- Agricultural growth and post-harvest losses drive demand.
- As per Ken Research, Promising future with potential for transformative expansion.
According to Cushman & Wakefield, Vietnam’s cold storage logistics industry is poised to achieve a market value over US $ 440 Mn by 2025. Despite this rapid expansion assumption, the cold storage sector remains considerably below its full potential. As of May 2021, Vietnam possessed a mere 48 cold storage warehouses, encompassing a capacity of approximately 700,000 pallets. Notably, only 8.2 percent of domestic food manufacturers implemented cold chain systems, whereas export manufacturers constituted 66.7% in 2020.
This situation presents an opportunity for reframing. Vietnam’s cold storage logistics industry can be said to be to an untapped resource, awaiting exploration & expansion. The projected growth trajectory signifies a promising future, yet the existing state calls for transformative measures. The limited number of cold storage warehouses and the relatively low adoption of cold chain systems by domestic food manufacturers highlight the significant scope for improvement.
1. What’s the current scenario?
In 2019, Vietnam had a total of 48 cold storage locations with a capacity of 600,000 pallets, 700 refrigerated trucks and vans, and 450 refrigerated container railcars with facilities meeting only 30-35% of the demand for the preservation of food, agricultural, and aquatic products. As the year 2020 unfolded, only 8.2% of domestic food producers were using a cold chain system, while export manufacturers accounted for 66.7%. Furthermore, distribution networks remain underdeveloped to provide a safe and efficient service creating a gap for potential suppliers to fill. But even though the market grew at a steady pace, alongside the disruption brought by COVID-19, new cold storage facilities continued to be built and upgraded in late 2020 due to rising demand.
2. What about the growth?
To learn more about this report Download a Free Sample Report
Vietnam’s agriculture sector has witnessed a robust growth, with the real GDP expanding by 5% annually to USD 41 Bn in 2020 from USD 31 Bn in 2015. High-value perishable products like meat and milk witnessed even faster growth rates. This surge in production led to a considerable increase in demand for cold supply chain logistics.
3. Post harvest Losses
Visit this Link: – Request for custom report
Post-harvest losses in Vietnam represent around 20-25% of total losses, equivalent to an estimated USD 3.9 Bn annually. To address this issue, the Vietnamese government aims to decrease the loss rate to less than 10%. Implementing a cold chain system presents a convenient solution to extend the shelf life of perishable products, minimizing losses and maximizing the value of agricultural goods.
4. The future to be an even pathway.
As per Ken Research, the cold storage market is expected to experience explosive growth alongside the latest advancements in vaccine development. Even after the pandemic is over, this growth rate will continue to be sustained by several factors including increasing consumer demand for perishable foods and the advent of new and more advanced pharmaceuticals. While the industry is nascent and still considered a niche market, perhaps that will change in the next few years and will become a key sector,” concludes Cushman & Wakefield.