English
Emerging markets are a hot topic of discussion in the business world, and the cold storage industry is not excluded from that discussion. Countries like China and India are becoming key markets to the cold storage industry as their populations become more urban and the demand for refrigerated goods increases.
A trend can be observed in developing countries where population growth and economic advancement work together to bring people living in rural areas into urban areas. In China, this surge in urban population is very evident. Research from the World Bank projects urban populations in developing countries to far outnumber that of developed countries – reaching 4 billion people worldwide by 2020. This rapid urbanization is correlated with a rise in incomes and the emerging middle class. Given the pace of urbanization in countries like India and China, Ernst & Young project those countries to have the largest worldwide share of middle class by 2050.
This is crucial to the cold storage industry as the middle class is a key driver of refrigerated food consumption. As populations make the jump to middle class income levels, food options become diversified. Diets shift from relying mainly on inexpensive grains for sustenance to include proteins from meats and nutrients from other refrigerated foods, which are increasing coming from global suppliers. From 2004 to 2014, refrigerated food imports to developing countries doubled, increasing from 15% of worldwide import to 30%, according to the latest Drewry Maritime Research report. This growth is projected to continue, outpacing developed countries significantly.
Emerging markets opportunities require innovative cold chain solutions to best tackle unfamiliar challenges for an effective logistics model. AGRO’s strategy allows our customers to import their product into a single port, where it is then disbursed throughout the country using regional distribution centers and distributed locally via cross docks. This system balances the cost of facility size with the ability to keep products turning. It also allows for consolidation of different product categories, creating logistical efficiencies for our valued customers.
About AGRO Merchants Group
AGRO Merchants Group owns and operates 53 facilities in 8 countries across North America, Latin America and Europe, with more than 700,000 square meters of cold storage. The company is focused on providing innovative cold chain solutions on a global basis by partnering with the highest quality family businesses and creating new, reliable, and integrated trade networks to help its customers grow. AGRO invests in modern assets, industry-leading technologies, and value-added service offerings to ensure the highest quality supply chain management standards in the industry.