Global Reefer Truck Industry- The Market Overview

Global Reefer Truck Industry- The Market Overview          

Product Overview: Most of the healthcare and pharmaceutical products need protection from light and heat to maintain their chemical formulation. Reefer Trucks are mainly designed to carry consumable goods at specific temperatures. Dairy products, fresh fruits and vegetables requires cold storage and transportation for their sustainability. A reefer truck is a van or truck designed to carry consumable products at specific temperatures.

Reefer Truck Market is growing as the demand of ready to eat, dairy products and pharma items is increasing globally. The demand for short and mid haul reefer truck is also in increasing as it is mainly coming from Fish and Milk products which need to travel faster within or outside the cities and demand for these products is expected to grow over the next five years which will drive the reefer truck market.

Some of the major players operating globally in Reefer Truck are Mercedes-Benz, Volvo, MAN, Tata Motors, DAF Truck, Isuzu, Freighliner Truck, Mitsubishi Fuso, Ashok Leyland, Eicher etc.

What is the need of reefer trucks?

Tobacco Products: Cigarettes and other high-value tobacco items require stringently controlled temperature levels to preserve freshness and quality among them.

Pharmaceuticals: Insulin and the seasonal virus vaccine must be stored at temperatures between 35˚F and 46˚F to prevent spoilage and contamination and should be transferred from one place to another under the same temperature range.

Chemicals: There are chances of a chemical reaction that could result in an explosion during transportation due to bad weather conditions, climate control helps in reducing the affect and helps in the preventions of these chemicals.

Personal care products: Lipstick can easily melt unless proper trailer temperatures are maintained. Moreover, perfumes, cosmetics and other personal care products must be protected against the possibility of decomposition during the transportation from factory to warehouse to store.

What are the key growth drivers for reefer truck market?

·         Growing pharma industry:

According to Cold chain organization, the future of pharma cold chain logistics is in good shape and the industry is expected to grow at a higher rate over the next five years. The growth in pharma cold chain logistics will affect the sales of global reefer truck market. Governments across globe provide key services, such as public infrastructure and legislation, which help in facilitating the refrigerated storage development.

·         Growing Food Industry in India:

Indian customers are rapidly shifting towards frozen and processed products backed by various socio-economic factors such as changing lifestyle supported by improving per capita disposable income, increasing product visibility across modern retail formats. Thus, it has become necessary for suppliers to make processed and frozen products available in every retail format, especially in Tier I, II, III cities. Therefore, demand for refrigerators that are used in trucks, tempos and mini vans, to maintain the product’s temperature during road transportation, is continuously increasing in India.

In India, there are 6891 cold storage facilities, having an installed or storage capacity of 31.82 million metric tons, while only 11% of the country’s total production of perishable products can be stored in cold storage chains. Moreover, only 105 million metric tons of the total produce of perishable goods in the country is transported throughout India annually, and only 4 million metric tons is transported via road reefers.

Storage Temperature Requirements in India, By application:

                                                                                                                                                                                                          Source: Techsci Research

       Growing Organic meat, poultry and dairy products Market:

     Organic meat, poultry and dairy products include organic eggs, chicken, pork, beef, milk, cheese, yogurt, etc. Organic meat, poultry and dairy products garnered a revenue share of 27.87% in global organic food market in 2016. Increasing value share of organic meat, poultry and dairy products in global organic food market can be attributed to rising demand for organic milk and organic eggs over conventional milk and poultry products. Organic food requires temperature maintenance during transportation to preserve it from heat and bad weather conditions. To transport organic food from one place to another, the reefer trucks are in great demand. The growth in the organic food industry will drive the reefer truck market over the next five years.

·         Hot weather is rising demand for reefer trucks:

Countries like India, Sudan, Oman, Libya, Mexico, Saudi Arabia, Malaysia etc. are experiencing extremely hot weather due to which the consumable products require favourable temperature during transportation. This is further fuelling the demand for reefer trucks in the countries which are facing hot weather conditions.

·         Growing Milk and Milk Products:

According to Food and Agriculture Organization of the United Nation, World milk production is forecast to grow by 1.4 percent to 831 million tonnes in 2017. Global trade in dairy products is projected to register a second year of modest growth in 2017, rising by 1 percent to 71.8 million tonnes of milk equivalent. The growing milk and milk products market will fuel the demand for global reefer truck market.

Conclusion:  Global Reefer Truck market is expected to grow at a CAGR of over 3%, in volume terms, over next 5 years, on the back of transportation of food, pharmaceuticals and healthcare products. Moreover, the demand for food products is also increasing across the globe which would further create demands for the reefer trucks during the forecast period. 

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