14 Jun 2016

General Queries on Cold-chain


1. What are the components of well-designed cold-chain system?
Simply explained, a good cold-chain is one that is designed to integrate the entire set of activities needed to transfer the harvested or produced value from source to consumer, while ensuring all climate controls for the value under its care. Such a system would also safeguard the environment, be efficient in managing waste and comply with food safety standards.

A cold-chain is a modern agri-logistics system and therefore must, at a minimum, incorporate the following infrastructure components:
  1. Modern pack-house at (or in proximity) to farm-gate
  2. Transport from pack-house to next stage in the supply chain
  3. Cold storage (hub) in proximity to market
  4. Cold storage (bulk) when storing at farm-gate
  5. Ripening units (in case of select produce only)
  6. Merchandising platforms (last mile retail units)
A well-designed cold-chain system will incorporate synergy in throughput capacity to maintain seamless connectivity. A cold-chain system will also maintain links with food processing and non-food processing facilities to divert capacity and extract maximum value for the produce owners. It may be noted, globally the various infrastructure components are usually delinked from single operational ownership and the operational or business processes fully integrate the value chain. Attention is also drawn to the following documents:
  • Operational Guidelines of the Mission for Integrated Development of Horticulture (MIDH)- Various missing links in the total supply chain and components that alleviate some of the pain points to holistic development have been considered and included in the MIDH Operational Guidelines.
  • Guidelines & Minimum System Standards for Implementation in Cold-chain Components- This document defines & describes the concept and application of cold-chain components supported by the Government and provides remarks & recommendations for the users.
2. How can cold-chain reduce food loss?
Cold-chain systems reduce food loss by ensuring that the perishable produce finds an avenue or physical access to consumption centres. Food loss occurs primarily because food perishes before being brought into consumption. This happens because access to market is beyond the normal lifespan or marketable holding life of the food item.

Cold-chain applies technology to first extend the holding life of the produce, and secondly by providing a mode to transfer to market within this extended time period. In a few cases, where the food item or crop is hardy and its life span can be extended over months, temperature controlled storage allows for commodity like time arbitrage while drip feeding the market in that duration. Perishable fruits and vegetables have a limited life span in normal conditions. However, unless the selling cycle will fall within this natural period, cold-chain intervention is required to mitigate food losses when markets are concentrated over distance.

Cold-chain does not preserve food, but extends life for a predetermined duration, within which period the food must reach shelves for consumption. Food preservation is the domain of food processing, wherein a new food product is prepared, and the harvested produce does not remain in its original whole format. The cold-chain not only extends the marketable life span of whole produce, it also brings organisation and standardisation to post harvest food handling. This ensures that fresh produce is packages to withstand road stress or damage, allows for modern material handling practices to reduce damage, provides relief from damage due to uncontrolled exposure and safety from external diseases. All of this also mitigates loss and allows more quantum to reach consumers, to reduce loss.

3. How does cold chain system maintain the safety and quality of produce at the desired level?
  1. Organised handling to bring about compliance with food safety standards.
  2. Reduced exposure to external microbial load with packaging and controlled ambient.
  3. Grading by size enables for safe handling practices.
  4. Use of dock levellers promotes good practices of palletised or unit load handling in cold-chain.
  5. In case of inanimate or post-mortem foods, cold-chain maintains the correct temperature to minimise decomposing influence of bacteria and other enzymatic activities.
  6. In case of living fresh produce, cold-chain manages the living condition (humidity, replenishes air, monitors & controls degenerative gases), segregates to avoid tainting between living tissues, and maintains optimal temperatures.
All of above helps to maintain the safety and quality of fresh produce and other products under care of the cold-chain.

4. How does cold-chain increase the productivity and income of farmers?
Farm productivity is a direct result of production processes, which include quality planting material, farming practices, INM/IPM, irrigation/fertigation, mechanisation, and other farming aspects. Cold-chain does not directly increase productivity of farmers.

However, cold-chain helps connect farmers to connect with more distant markets and can directly extend their selling radius. This extension of their market radius, indirectly impacts on farm productivity. With gainful value realization and greater market capture, farm level productivity is inherently promoted.

This is explained as follows-
  1. Cold-chain counters inherent perishability and thereby provides option of more time to handle perishable food items.
  2. This extension of handling time, directly addresses ability to extend connectivity from farm-gate to consumers, over longer distances than normally possible.
  3. Cold-chain can therefore open or extend market footprint of farmers and help to seamlessly communicate the value harvested by farmer to more consumption centres.
  4. By empowering farmers with the ability to capture a larger buyer base, cold-chain results in an increase in the total volume of sales of produce.
  5. Not merely, extending the reach of farmers market across geographies, the cold-chain also serves as the custodian of quality and value that is produced their effort.
  6. This in turn, feeds and justifies efforts to increase productivity. Without market reach, the higher productivity results in food loss, as has been periodically evidenced.
Physical access to more markets, adds to the revenue options of the producer, and in turn substantiates greater and gainful productivity and production.

5. How does cold-chain add value and to what extent?
Cold-chain does not directly add value to the produce, but merely safe-guards the value under its custody. Cold-chain is a market linkage mechanism and protects the value entrusted in its care. Value addition occurs at production end of the food chain.

A farmer produces value by converting raw inputs (water, fertilizer, labour, energy, etc.) into a final product. This is akin to the value created by any manufacturer of marketable goods. For this purpose, cold-chain activities are not subject to value-added-taxes.

Nevertheless, since cold-chain extends the marketable life of the produce under care or assists to maintain the sell-by/expiry life of a processed product, it is considered as a market linking set of activities, that brings value to the producers. For all purposes (legal, taxation and domain terms), cold-chain does not add value to the product but only empowers the producer/owners to connect with more markets and increases their ability to capture greater value for their produce/product.

6. How does cold-chain support the development of diversified food industry? Cold-chain is a specialized logistic system that serves as a conduit to carry and safeguard value, which was either manufactured or harvested, from source to end consumers.
  • The modern Pack-house, is the nerve centre for cold-chain and initiates multiple market routing or value realisation opportunities.
  • A pack house unit allows to selectively channelize the following market destinations:
  1. Direct to local market channels, packaged or non-packaged (value realisation)...
  2. Localized storing of selected produce for off-seasonal supply (delayed value realisation)...
  3. Channelize into cold-supply-chain for distant markets or cold stores (value realisation)...
  4. Selected produce routed to food processing units (value-addition to culled or specially produced crops)...
  5. Management of waste by routing to non-food processing uses (value-addition to waste)...
All of these market destinations is a point of gainful value realization, and helps optimize upon the harvest. Depending on quality, food can be throughput in organized fashion to local consumers, distant consumers, value-adding processing units, or to other non-food processing or other uses. A diversified food industry would optimize upon all such end-uses and cold-chain is probably the only logistics sector that serves as the root cause of such industry specific development.
Cold-chain is the only logistics arena to become the root cause of the domain it serves.
7. What are the new technologies in cold chain management system for perishable food in India?
Cold-chain involves preconditioning, transport, warehousing, distribution and retail and hence a list of technologies would be varied. Technology is primarily needed in cold-chain to manage activities involving the Product Life Cycle, Packaging, Labelling Cooling, Transport, Storage, Distribution, Monitoring, FEFO, Atmosphere, Vibration, Refrigeration, Energy, Food safety and Trade Processes.

 

Besides the commonly understood technologies of mechanical refrigeration, electric motors, insulation, etc., the following list is of certain technologies and applications that help manage and improve operational concerns in cold-chain management. These technologies are not necessarily new:

◾Warehouse management system (WMS) ◾Transport or Fleet management system (TMS) ◾Food Traceability system (FTS) ◾Thermochromatic inks ◾Photo-catalytic equipment ◾MAP packaging ◾Organic packaging ◾Dynamic racking ◾Portable CA Tents ◾Multi-modal transport ◾PLC / Automation ◾Alternate Cooling (Mag-lev, Vapour Absorption, Thermal banks, Liquid Air, etc.) ◾Various Hybrid application in energy sourcing This list is not comprehensive and the technologies may be deployed across the various equipment or infrastructure components in the cold-chain.

8. Categories of Cold chains?
Cold-chain may be broadly classified on the basis of temperature and total holding life into:-

a) Chill- (0°C to 10°C) - temperate Fresh fruits & vegetables, fresh meats, milk, butter, etc.
b) Mild Chill (10°C to 20°C) - Sub-tropical Fresh fruits & vegetables, chocolates and seeds and some milk products.
c) Frozen (below-18°C) - frozen ingredients, processed fruits & vegetables, Ice Cream, frozen meats (fish, poultry, livestock), etc.
d) Normal (>20°C) - Whole Onion, Dehydrated Foods, Pickle, Jams and Oils and extracts.

Cold-chain may also be categorised on the basis of infrastructure type, such as:-

a) Static– Cold storages, pack-houses, Ripening Units etc.
b) Mobile- Mobile Precooling, Reefer Vehicles, containers.

9. Major Cold-chain infrastructure Components? Major cold-chain infrastructure components have been highlighted in the MIDH guidelines and NCCD.2015 study and are namely:-
a. Modern Pack-house- source point at farm-gate (for fresh Produce preconditioning) 
b. Long Haul Transport- Transport from source to wholesale buyer 
c. Cold Storage Hubs – Close to consumption/ distribution centre 
d. Cold Storage Bulk- At farm-gate/food processing premises 
e. Ripening Chamber- Close to consumption/distribution centre 
f. Last Mile Transport- Within distribution city 
g. Retail/Front end – Last mile Merchandising 
h. Kitchen or consumer level – domestic fridges

There will be product specific variations. It must also be remembered that pharmaceuticals, electronics and chemicals will also have unique requirements. However, the above will apply broadly to all.

10. Role of various Ministries?
Ministry of Commerce and Industries, (through APEDA) promotes development of cold-chain for agricultural produce for purpose of export (agricultural produce is defined as per the Finance Act). Similarly MPEDA has also been supporting certain needs of marine produce exporters.

Ministry of Agriculture & Farmers Welfare provides the maximum capital support for cold-chain development, through DAHDF and MIDH. DAHDF provides support to Animal Husbandry, Dairy & Fishery sector while MIDH promotes cold-chain for horticultural produce. MIDH is the world's largest such intervention with budget of Rs. 16000 crores (nearly USD 2.6 billion) for 3 years. 

Ministry of Food Processing Industries (MoFPI) also supports cold-chain creation for both agricultural produce and for processed products. However, besides cold-chain, MoFPI also incorporates support for developing infrastructure exclusively used in value-addition and preservation activities (cold-chain and value addition & preservation industries).

Ministry of Finance through DEA also supports PPP ventures in cold-chain. Besides, tax and duty exemptions to support cold-chain are supported through this Ministry.

Due to certain commonality in the use of refrigeration systems, there is a resultant overlap between cold-chain and food processing technologies though both are distinctly different domains.

11. What is the cold-chain infrastructure requirement vs availability in India?
This information is a matter of scientific research and answers cannot be expected from general opinion based enquiry. The “All India Cold-chain Infrastructure Capacity (Assessment of Status & Gap)” report by NCCD is the only comprehensive study. The field work and data collation was done by NABCONS. The published report may be reviewed for understanding and information on requirement and availability.

12. Can energy requirement for cold chains be reduced by use of superior technology, alternative energy sources, etc.?
All technology based applications can help reduce energy load in the cold-chain. At first step, the insulation is an important barrier to heat load. Secondly, the type of refrigeration can reduce energy load. Technology that hastens operations and minimize breaches in thermal integrity like dock shelters also reduce energy consumption. Similarly, various thermal barriers, automation and efficient facility designs also reduce energy requirement. It is to be noted that the energy to counter field heat, and respiratory load cannot be reduced.

Good operational and design practices can reduce energy leakage. On the other hand, alternate energy sources cannot reduce the energy requirement. Instead, they only replace the energy source. Usually dual energy sources are used for cold stores and diesel based systems for periodic and/or transport based systems.


It may also be understood that in the complete chain, the production end and the transport leg are the most energy intensive. Keeping risk to product and continuity of refrigeration in mind, assured power is important in the cold-chain. Technologies such as large capacity fuel cells, when fully developed may find suitable use. At the moment, hybrid systems that deploy solar thermal, solar photo voltaic, geothermal energy, grid and generator based electricity serve as energy sources.

13. Are the railways and ships part of the cold-chain infrastructure?
Cold-chain has essentially developed worldwide as a multi-modal transport system. Therefore, all modes of logistics are part of cold-chain and best practices in cold-chain necessitate designs that incorporate roadways, railways, airways, and waterways.

14. Will Retail outlets be considered part of the cold-chain?
Provided that product handled in the cold-chain requires a controlled ambient for gainful end-use, all handling of finished product would be part of the cold-chain. This therefore means merchandising platforms (point of sale cabinets, vending platforms, humidity controlled shelving) are a part of cold-chain. Ministry of Agriculture has included financial support for temperature controlled outlets including street vending carts.

In fact, considering Indian consumers’ buying patterns, retail outlets are more important in the frozen product segment than fruits & vegetables. It maybe differentiated that the equipment (even if at retail outlets), used to process the goods into a new food product, such as grinders, mixers, cookers, ice-flake makers, fryers, dicers, etc., would not be considered a part of cold-chain. These would be part of the kitchen or processing industry.

15. What are the best practices in cold-chain management systems in India?
In terms of cold-chain management, best practices in India can be evidenced in the grape export systems. Similarly good practices are evidenced in meat (beef & fish export), ice cream and milk distribution.

Good practices can also be witnessed in businesses that have centralised kitchens for cross-geography markets (eg. Dominos and McDonalds). In case of cold warehousing, innovative practices are also evidenced in case of potato and dried chilly storage. Good practices in the cold-chain must incorporate HACCP systems, meet compliance of food safety regulations, minimise damage to the environment, manage risk to inventory, result in avoiding food loss, prevent leakage of energy, support upkeep of machines and equipment, whilst facilitating streamlined and faster movement to end-consumer.

16. What are the components of good infrastructure for transportation, storage, cooling and marketing?
The mechanisms that promote best practices and promote safety would be considered as “components of good infrastructure”. Systems that have a lower negative impact on environment – ecofriendly refrigerants and energy efficient operations would also be considered to be good. Broadly, the components of good infrastructure have been categorized as follows:

◾Natural or Low ODP/GWP refrigerants. ◾Program logic controls to improve the energy efficiency. ◾Equipment with high MTBF (mean time between failures). ◾Improvement in reducing external heat ingress. ◾Variable and step-less controls in refrigeration. ◾Sensors and alarm components that enhance safety of the refrigeration plant. ◾Infrastructure designs with built in equipment redundancy and safeguards.

17. Food Loss and Waste - India vs. World
FAO’s (HLPE Report 8) study of June 2014 evaluated that 115 Kgs per capita per annum food is lost in South & South-eastern Asia before reaching consumer. In this region, an additional waste of 11 kgs/capita/annum is assessed at consumption point. The loss translates into an estimated 2,700 lakh tons of food produced in this region.

Worldwide, the report suggests losses incurred are in the range of 30% of harvest. However, these losses include all whole food (grains, meats and fruits and vegetables, etc.) and does not differentiate losses occurring within or without a cold-chain.

 
In India, CIPHET published a report in 2015, which estimated losses in India range from 4.58% to 15.88% in selected fruits and vegetables. These evaluations seem to have missed certain activities in the total chain. There is no comprehensive study at hand that differentiates between losses within the cold-chain and outside the cold-chain. However, pragmatic reports from established operations indicate that the majority of losses can be mitigated through use of cold-chain connectivity.

Experienced stakeholders inform that in well managed cold-chains, losses incurred are minimal (~5%), provided that the intervention promotes continual supply linked to markets, and with shelf deliveries made well within the enhanced holding life.
-Pawanexh Kohli

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