Cold storages; new business opportunity
Cold storage services will grow at a CAGR of 13–14% for the next five years.
Cold storage services will grow at a CAGR of 13–14% for the next five years.
Brief:
Business Standard reports that India will add cold storage facilities worth INR 21,000 crores.
It will involve setting up of new plants and upgrading the old ones.
What does it mean?
India Today reports that 50% of perishables food items such as fruits, vegetables and milk go waste every year. It is equal to $ 440bn.
India has 7,645 cold storage facilities.
They store about 11 per cent of the country’s total perishable produce.
There is a scope of huge growth in the coming years.
Why does it matter?
Food supply chain offers bigger opportunity than sunrise ones such as consumer internet.
There will be compounded annual growth rate of (CAGR) of 13–15% over fiscals 2019–23, mainly driven by rising demand for processed food, fresh fruits & vegetables, seafood and bio-pharmaceuticals in exports markets.
Government also offers subsidies to the entrepreneurs. For instance, the union ministry of food processing offered subsidy at 50 per cent of the project cost with a cap of Rs 10 crore.
How much does it cost to set up the storage?
It costs INR 20 crore to set up a multi commodity storage.
It can store meat & poultry, seafood, dairy products, fruits and vegetables, and pharmaceuticals.
A typical cold storage has a capacity of 10,000 tonnes.
It’s payback period is of 6–7 years.
The big picture for Delhi-NCR
The region’s nearby states are agricultural stars, such as Haryana, Punjab, Himachal, Uttar Pradesh.
Venture Capital has already started to invest in agricultural technology startups.
Coldex from Delhi-NCR is one of India’s biggest food logistics company.
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