, India

APAC cold storage facilities in hot demand amidst vaccine rollouts

Cold chain storage remains undersupplied in Asia on a per capita basis.

The COVID-19 pandemic has accelerated many trends in our society and economy. Global supply chain management is one industry that is under transformation, with long-lasting implication for the provision of logistic real estate.

According to JLL, one of the most significant influences of COVID-19 on supply chain management will be the cold chain logistics – the infrastructure and process required to maintaining specific temperature bands under which perishables can be stored and transported. 

Demand for cold-storage warehousing has been rising globally due to the surge in online grocery shopping. The pandemic has accelerated this trend as consumers place increased emphasis on ready-made meal and online grocery ordering.

Here’s more from JLL:

Cold-storage uses also include pharmaceutical products and the sector is critical in getting COVID-19 vaccines that are rolling out this year. Due to variations in the storage temperature requirements of the different pandemic vaccines, governments and the private sector are mobilizing available cold chain capacity. Vaccines with an ultra-low storage temperatures (e.g. -70 °C +/-10 °C) pose severe challenges for many emerging countries. For example, the Pfizer-BioNTech COVID-19 vaccine represents a logistical challenge as shippers must keep it at an exceptionally cold minus-70 degrees Celsius.

Moreover, this vaccine is likely the first of what is expected to be many pandemic vaccines that have ultra-low temperature cold chain requirements. Because Initial batches of COVID-19 vaccines may be scarce, the World Health Organisation has issued guidance on cold chain and supply strategies to ensure that vaccines are deployed to the target populations efficiently. These mechanisms such as storage, repackaging, transportation and tracking of products should become standard protocols for many countries that receive COVID-19 vaccine even after the pandemic.

Compared with other products in the cold chain market, pharmaceutical products are generally high value-added commodities and with a short shelf life. With strong projected growth in medicine sales and wider uses of temperature-controlled medicines that require complex supply chains, the Asia Pacific region should see strong demand for cold storage industrial properties over the short to medium term.

As with other types of logistics infrastructure, the region has significant shortages of modern cold-storage assets. Historically, cold storage capacity in Asia Pacific has been limited due to the cost and complexity of construction. The total capacity of refrigerated warehouses worldwide was 719 million cubic meters in 2020, according to the Global Cold Chain Alliance (GCCA). The US, at 156 million cubic meters, was the single largest country market, followed by India at 150 million cubic meters and China at 131 million cubic meters. Recent increases in capacity was largely from North America and China.

Cold chain storage remains undersupplied in developing Asia on a per capita basis. According to GCCA, cold storage space in China and India average just 0.1 cubic meter per person in 2020, ranking behind most leading cold storage markets worldwide. In comparison, US lead on a per capita basis with 0.5 cubic meter.

As such, there is huge potential for operators to build new capacity in the region and develop new facilities such as fully automated cold storage warehouses. At the same time, this growing sector will create opportunities for investors to create partnerships with experienced operators. There is also large potential to convert existing warehouses into cold storage facilities or to upgrade older cold storages by adopting cost-effective technologies.


Figure 1: Cubic meter per person in the world’s top ten cold storage markets

Source: Global Cold Chain Alliance, Statista, Oxford Economics, 2021

Note: Capacity for US, China and India as of 2020, 2018 for the rest.


Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!

Get Realestate Asia in your inbox
Analysts revised up pricing outlook as the probability of cooling measures wanes.
JLL believes the market’[s rebound is gaining momentum after several false alarms.
These two projects will bring a total of 542 new rooms to the market.
The average market capital values are now below THB 127,000 per sqm.
Industrial stock is expected to reach a total of 571,100 sqm this year.
New launches increased 18.1% to 3,716 units, driving healthy sales figures.
Blame it on burgeoning vacancy rates and a heavy supply schedule.
Secondary vacancy from last year’s supply is likely to materialise later this year as office demand weakens.
The midscale segment will account for 42% of the new supply.
Blame it on weak expat demand and their shrinking housing budgets.
Vacancy rate reached 9.8% in Q1, the highest since 2009.
Rents and capital values are still under pressure as landlords drop asking rents.
New private home launches fell from 1,038 units in April to just 514 units in May. 
There were no new projects launched in Q1 as developers focus more on selling existing ones.