India Cold Chain Logistics Market Assessment, By Type, By Temperature, By Reefer, By Application, By Region, Opportunities and Forecast, FY2018-FY2032F

India cold chain logistics market is projected to witness a CAGR of 16.34% during the forecast period FY2025-FY2032, growing from USD 12.68 billion in 2023 to USD 42.56 billion in FY2032. Several key factors drive the growth of India cold chain logistics market, primarily the growing demand for perishable products due to an increasingly higher population and a more urban population. Consumers demand fresher fruits, vegetables, dairy products, meat, and seafood, while efficiency in cold chain logistics becomes the prime requirement. Other factors in terms of commodity growth and increased demand for the availability of such perishable items in real-time will directly help the forward movement of the market. Initiatives such as Operation Greens and Pradhan Mantri Kisan Sampada Yojana provide the much-needed infrastructure support and subsidies to set up cold chain infrastructure in the country, thereby increasing its capacity to meet this demand.

Technological upgrades drive the growth of the market as the IoT, blockchain, and AI increase the efficiency and transparency of operations. The benefits of greater cold chain capacity stem from the upward trend in Indian pharmaceutical and food exports, which requires an advanced cold chain to ensure the export of quality products. With incomes increasingly disposable and the middle-class population growing, consumers' expectations of high-quality products will spur investments in cold chain logistics. All these factors combined are likely to propel the growth of India cold chain logistics market over the next few years.

For instance, in February 2022, Coldman Logistics entered the ambient warehousing market. Ambient warehousing refers to storing products at room temperature without refrigeration or other controlled temperatures. It is the opposite of the conventional Coldman, which usually deals with cold chain logistics, with most dealing with temperature-controlled storage and shipping. Also, Coldman Logistics expanded its services to include ambient-stored goods. This illustrates how the growth of e-commerce in India, undoubtedly, has pushed the demand for warehousing, especially modern warehouses for storing food products.

Rise in Demand for Perishable Goods to Drive Market Growth

The rise in demand for perishable goods in India can be attributed to several key factors, such as growing population, urbanization, rising incomes, health consciousness, and others. Combined with the rise in e-commerce, domestically and internationally, good storage facilities in terms of quality and volume are essential.

While India's perishable exports are significant, inefficient cold chain operations result in significant losses. Huge volumes of post-harvest losses occur in fruits and vegetables. As per the International Society for Horticultural Science, annually, 30% of the fruits and vegetables grown in India, amounting to 40 million tons, get wasted as there are gaps in the cold chain, such as poor infrastructure, insufficient cold storage capacity, unavailability of cold storage near farms, poor transportation infrastructure, etc. Similarly, the pharma industry, which relies heavily on an efficient cold supply chain network, suffers significantly in terms of financial losses due to improper storage and disrupted transportation of sensitive drugs, vaccines, and raw materials. Improving the infrastructural level of cold chains and post-harvesting will lead to a significant reduction in losses, generate a surplus for export, and increase farmers' incomes. This requires heavy investment, which will result in significant growth for this industry.

For instance, in May 2024, an Agritech startup Superplum announced that the company raised USD 15 million in its Series A funding round to expand its business. The company works with farmers across 22 states in India and runs modern sourcing and supply chains for 25 fruits across the year.

Government Measures Acting as a Catalyst to Drive Market Growth

The Government of India has implemented several measures to improve cold chain infrastructure. These measures are aimed at enhancing the efficiency and reach of cold chain logistics in India, ensuring the quality and availability of perishable goods. These include the Integrated Cold Chain and Value Addition Infrastructure Scheme, which aims to establish a comprehensive cold chain system from the farm gate to consumers, encompassing pre-cooling, sorting, grading, packing, and transportation facilities. The Pradhan Mantri Kisan Sampada Yojana (PMKSY) focuses on developing cold chain projects across sectors like fruits, vegetables, dairy, meat, and poultry. Both schemes provide financial support through subsidies, loans, and grants to encourage private investment in cold chain infrastructure, ultimately enhancing food supply chains and reducing post-harvest losses. The government also provides subsidies, loans, and grants to encourage private participation in developing cold chain infrastructure.

For instance, Operation Greens is a scheme launched by the Government of India under the Ministry of Food Processing Industries. The scheme aims to stabilize the supply of tomato, onion, and potato (TOP) crops and control their price volatility. The primary objective is to protect farmers from distress sales due to price fluctuations and reduce post-harvest losses.

Dairy and Frozen Desserts to Dominate Market Share

The dairy and frozen desserts segment is the most consumed and, hence, the largest in the cold chain logistics market. The demand for dairy products and frozen desserts is huge, and their perishable nature requires tight temperature control to remain fresh and of quality. The dairy industry generates vast volumes of milk, cheese, yogurt, and so on, hence requiring wide-ranging cold storage and transport infrastructure. These temperature-sensitive products, in turn, require effective cold chain logistics, and therefore, their market demand is massive. Dairies produce milk, cheese, and yogurts, which are made with several processes in strict temperature control for quality, safety, and shelf life; ice cream and sorbets are frozen desserts of this category. This is one portion that requires strong refrigeration and freezing capabilities, which will maintain the freshness of the product while at the same time offering the needed control to enhance health and safety considerations. Inside such sophisticated cold chain solutions of the dairy and frozen desserts market, there would be absolute control over temperature along with real-time monitoring of the product from production to further handling, distribution, and retail.

For instance, the Board of Directors of Vadilal Industries Limited (Company), at its meeting held on 25 May 2024, approved the shifting of Bareilly Plant to a new place with a bigger capacity at an estimated cost of USD 4.62 billion (INR 385 Crores). This reflects that the company is quite aggressive in increasing its production capacity to meet the surging demand for its products. Moving the Bareilly plant to a new location of bigger capacity will enable the company to enhance its production efficiency as well as the quality of the offerings it makes available.

Northern Region to Dominate the Cold Chain Logistics Market Share

In India, states in the northern region hold the highest number of completed and ongoing cold chain projects. Uttar Pradesh holds the highest number of cold chain storage as the state is a significant producer of agricultural products and needs effective cold storage to ensure the preservation of perishable products. The state government has, therefore, been enthusiastic about the development of cold chain infrastructure as a means of reducing post-harvest losses, enhancing the general efficiency of the supply chain, and increasing technology usage, which plays a huge role. This dominance is because of the agricultural supremacy of that region, friendly government policies, and a strategic location for cold storage.

For instance, the Uttar Pradesh government, under Uttar Pradesh Food Processing Industry Policy 2023, offers a subsidy of 35% for infrastructure pertaining to Cold Chain and Value Addition and a subsidy of 50% up to USD 1.19 million (INR 10 Crores) for frozen storage/deep freezer, value addition and processing infrastructure. This subsidy aims to reduce the financial burden on businesses investing in cold chain infrastructure, encouraging the development of advanced storage solutions to preserve perishable goods and enhance the overall efficiency of the supply chain.

Future Market Scenario (FY2025 - FY2032F)

Cold chain logistics will continue to be influenced by the growing demand for perishable products, which is borne by an increasing population and urbanization, in addition to growth in incomes.

The market will grow strongly based on continued government support and incentives for developing cold chain infrastructure.

The demand for cold chain logistics will continue to expand further with the growth of e-commerce since perishable products are increasingly bought over the internet.

The advancement of technologies, such as IoT, Blockchain, and AI, will make cold chain logistics operations more efficient and transparent.

Key Players Landscape and Outlook

The cold chain logistics market in India is highly competitive, besides being constantly influenced by many factors such as service quality and pricing, competitive technological advancements, and geographies. Some of the expanding factors for this market are the developing middle class with rising disposable incomes and the urbanization of India. Major players seek some unique quality wherein they can excel and provide high-end services, such as firms offering cost-effective warehousing and transportation services for perishable goods, some specializing in temperature-controlled logistics, some specializing in a specific domain, such as pharmaceuticals, and others.

In January 2024, Snowman Logistics Limited began its operations at a newly leased multi-temperature-controlled warehouse in Guwahati, Assam. The total capacity is 5,152 pallets within an eight-chamber facility with four loading bays equipped with the latest infrastructural facilities. The warehouse will be specifically designed to stock products from ambient temperatures to minus 25 degrees Celsius and primarily engaged in providing storage, handling, and transportation services of ice cream, poultry, ready-to-eat food, dairy products, confectionery, bakery products, seafood, fruits, and vegetables.

In December 2023, CEVA Logistics representatives received the award of Top Green Company in Asia during the gala ceremony of the 2023 Asia Corporate Excellence and Sustainability (ACES) Awards held in Kuala Lumpur. The ACES Awards recognize successful companies and individuals in Asia across the domains of leadership and corporate social responsibility. The awards value and appreciate the services and achievements of the businesses, small and large, national and international, for their very crucial contributions to their communities and the world.