Perspective on India's Cold-chain

India has developed an enviable capacity in the cold storage format across the country. As per the 2014 report of IARW (International Association of Refrigerated Warehouses), India had 131 million cubic metres in cold storage capacity, overtaking USA which has 115 million cubic metres. China has the third largest capacity globally with about 76 million cubic metres in cold storage space. The worldwide capacity in refrigerated warehouses was reported as 552 million cubic metres in this report by IARW. Between May 2014 and July of 2015, India added another 200 units or a little more than one million tons to its cold storage space. Though about 5% of the facilities may have become obsolete over the years, India can now lay claim to having created almost 7200 cold stores equivalent to about 33 million tons in holding size, most of these over the past decade.

Shelf life is not storage life

Holding period in a warehouse is opportunity lost.

Keeping food secure for long is not always a worthwhile achievement... making sure it arrives for gainful end-use is the real target. Aim to make sure you reach the consumer - get on the shelf!

Segregation is good… sometimes

Cold chain operators are usually counselled that they must segregate goods in the cold-chain.

The need to segregate stems from the fact that fresh farm produce is frequently incompatible with one another, and is good practice to mitigate risk of damage & food loss.

Segregation is important in the cold-chain

Cold-chain is not only about cooling alone but must look at various compatibility aspects between different species of the goods involved. This is in particular the case when handling fresh fruits and vegetables. Unlike aseptically sealed foods, the packaging of fresh produce has to allow access to the surrounding air and therefore makes it susceptible to tainting, moisture loss and biological triggers.

Cold-chain Storage Types

We frequently see confusion in use of the terms that describe or relate to different types of cold storage spaces. This article defines the basic categories of environment-controlled storage systems used in food supply chain.

Size and Capacity - are distinctly different, even if correlated

Cold-chain is about Speed!

Frequently cold-supply-chain strategists are asked to help develop models for a laudable vision, one that envisions a revenue multiplier for farmers-producers. This Vision is typically presented alongside tactical options, those that focus on enabling small farmers to offset their sales by storing their weekly or seasonal produce, thus avoiding peak season price drops. This is also expected to avoid distress sales due to low shelf life of the perishable produce.

Ergo the cold-store, which is viewed as a buffer space that can extend the trade opportunity, conceivably offering safe, risk free storage and defer the sale to a more favourable future date. This tactic lends itself to the core premise that the buying markets will pay a higher value at a later date, when supply patterns are low.

Sort yourself out, Grade yourself in

Sorting and Grading are commonly spoken of as one activity - in the persihable trade. But where lies the difference and where lies the finesse... lets try and understand the discriminating differences!
 
Sorting: the activity at source when produce is assorted into target lots basis qualitative criteria – as non-edible, as reject or dump, by quality, by shelf life, by market value, etc. This sorting activity is the first step that brings the concept of value to fore. Essentially, this is the first stage categorisation of received produce and separates them into differentiated value-based flow towards an ascertained and useful end-use.

Preserve and protect, Extend and connect - apply sensibly

Essentially, the cold-chain is tasked with two underlying functions - to “Preserve and Protect” and to “Extend and Connect”. Let us explore these two distinctions and by understanding them, the approach to cold-chain development may merit certain changes.

First, let us clearly differentiate the type of products that benefit from the cold-chain.

In further simplifying, we can consider two extremes from a choice of product types... ice cream and fresh mangoes. The first symbolises the frozen (< -18 °C) segment and the other is from the mild chill (10-20 °C) segment. In the case of ice cream, the cold-chain functions to preserve the product, and in the case of mangoes the cold-chain serves to extend its prevailing, but short saleable life.

What’s with Solar panels and their usage…

Why do stand alone SME industrial units, homes and I include cold storages, shy away from installing solar panels to generate electricity?

Yes, cost is a factor as always. But that is one factor that is continually showing a downwards trend. (Today, if reports are true, the selling price per watt of solar photo voltaic is about 0.50 USD. Reports also suggest that this price is expected to come down to 36 cents per watt in 5 years. Past records show that in 1977 the price per what stood at USD 76 per watt).

The other reason quoted is the hassles of operations and maintenance. This is typically because the implied concept of Solar PV panel requires the use of a bank of batteries to store the cheap electricity. And batteries need to be replaced every now and then. The electricity that is generated from solar insolation would need to be stored in batteries, which in turn would be sourced to create AC power for use in common utilities. Another limitation for industries is that they may need 3 phase input into their machines.

But why store this electricity, why bother with batteries and et al? What if the solar power is fed directly into the local grid. I am not talking about sharing the surplus generated with the grid… the concept is to feed ALL that the sun generates for you, straight into the grid.

Focus development in Rural India

Rural India as the source, not just as a destination market

India’s Cold-chain sector was traditionally driven by the industrial infrastructure and equipment providers and various documents output by industry bodies like CII and FICCI and large consulting firms drove across the need for greater storage infrastructure required in this sector. The country followed through, and over years developed an enviable capacity in cold storage, amongst the largest in the world. Yet, our cold-chain is still considered nascent and troubled. As a follow-up, the government of India constituted the NCCD; sanctioned by the cabinet in February 2012, envisaged as a think tank to policy makers, involving participation from cold storage providers, technology & equipment providers, consultants and grower associations.

Ever since its incubation, the National Centre for Cold-chain Development (NCCD) has moved the understanding that mere storage of produce is not the final solution to food distribution. Cold-chain means market linkage and it involves a series of inter-weaved activities and has an expanded horizon beyond temperature controlled storage. NCCD thereby opened its participation base to include educational institutions, farmers and producers, traders and sellers, self-help groups, consumer groups, student groups, agri-entrepreneurs and enterprises involved in air, sea, rail & road logistics, finance, retail, research, packaging, marketing, etc.

Today, besides the equipment providers & store owners, the entire cold-chain user base, including who are impacted by it and those who add value in form of knowledge or R&D, now have opportunity to contribute directly to future developments. Through such collective participation from a wider stakeholder base, more conjoined inputs for holistic development is resulted and made this unique brain trust (NCCD) even more inclusive across all cold-chain segments.

Efforts were then undertaken to identify what were the major missing links in India's cold-chain, specifically in relation to fresh agricultural produce. Various options were put forth…

Perishable Business concepts

Enabling Horticulture Trade

I am frequently asked to assess studies and the strategies that will help develop a revenue multiplier for farmers-producers, to save food wastage and safe guard national resources; truly a laudable Vision. This vision is typically presented alongside tactical options that will enable farmers to store their weekly or periodic produce, so as to avoid peak season price drops and distress sales that stem from low shelf life of perishable produce. Ergo the cold stores, conceivably offering safe storage and extending the sale opportunity onto a more favourable future date.

Sadly, the glorious vision cannot be served merely by storing produce, abiding to ‘time the market’ for the ‘right price’. This tactic lends itself to the core premise that the local buyer will pay a higher value at a later date, when supply patterns are low - the market remains the local buyer/mandis, specific to the growing region. This concept is true to an extent but does not leverage cold chain technology to the fullest. This is not an in-depth solution by far, and is a business notion that will perish!

CA cold stores

The concept “Controlling the atmosphere”

Cold stores alter the temperature inside an enclosed chamber through the use of refrigeration. To save operating costs of the cooling equipment, insulation as a thermal barrier is used to minimise external heat ingress. Depending on the product types stored, the cooling is distributed inside the chambers using fans which circulate cool air – in case of frozen temperature ranges, the cold air need only shield and isolate the cargo from the exterior peripheral walls & other heat ingress.

In case of living fresh produce, the cold air must additionally envelope each individual product piece and penetrate interstitial space in storage to evacuate other gases & heat produced due to respiration. This is ordinary storage and does not involve tampering with natural atmospheric composition.

Controlled atmospheres are essentially those which deviate from the normal air composition of 21% oxygen, 78% nitrogen and 380 ppm of carbon dioxide (Other gases present are normally too small a concentration to have a prime effect on stored produce). Controlled Atmosphere cold stores best understood as cold storages designed and fitted with additional equipment such as to actively change and control the atmospheric content inside the closed chamber.

Frequent Questions about NCCD (National Centre for Cold-chain Development)

About NCCD

1.    Could you please provide some highlights about the initiatives undertaken by the NCCD for the development of cold chain infrastructure in India?

See Wikipedia Article on NCCD

NCCD under its agenda of inclusivity has held various interactions with stakeholders from inception, for inputs to develop its roadmap to targeted conclaves to receive recommendations to ease the roadblocks to further development. These stakeholder interactions are followed up for directed interventions by the government. Of notable achievement is that NCCD has already redressed some concerns by project implementers by providing ready response to interpretations of subsidy guidelines. NCCD has brought about an improved understanding in allied sectors on the opportunity and remedial options in this sector.

In another initiative, NCCD has opened participation to a wider base of stakeholders by including educational and research institutions, farmer producer organisations, self-help groups, student groups and other allied industry sectors. Please go through attached criteria document – we are surprised that some industry stakeholders who habitually profess interest in supporting cold-chain development have not walked-the-talk by partaking in NCCD. The industry at large must realise that the government is a facilitator to support the ground action that they hope to fulfil. NCCD was formed to supporting them... and as a measure of their interest. We feel the initiatives need to arise from business enterprises in tandem with government interventions.

NCCD is also advising on the XII Plan period assistance programs and aims to bring technology interventions and more support to participants from the logistics sector.

2.    What are the achievements of NCCD so far, you would like to highlight?