A young and growing population and a 24-hour economy are helping boost the Philippines’ cold chain industry, according to Frans Kok, general manager for Asia-Pacific of global trade and logistics IT solutions provider AEB.
AEB offers warehouse management developed for cold chain warehouses including blast freezer receiving, collective picking and data-capturing technology.
Citing a report by market intelligence provider Ken Research, Kok told PortCalls the Philippines’ cold chain industry is forecast to take in revenues of $20 billion by 2023.
The Cold Chain Association of the Philippines earlier predicted industry growth of 8% to 10% in the next five years.
READ: PH cold chain industry projected to expand by up to 10% in near term
Kok said a young population more mindful of food safety and more health-conscious is boosting growth along with the business process outsourcing industry. The latter spurred development of a 24/7 economy and a shift in food consumption habits that have led to more people consuming food even during unusual hours of the day.
Also driving the sector are the country’s expanding population with greater spending power and demanding more food choices; increasing number of local and international food companies; and a growing pharmaceutical segment.
Challenges abound though, including the high cost of electricity—which accounts for a large share of the expense of cold chains—poor infrastructure, high cost of certifications, and truck bans.
Kok also noted how traffic in metro areas has required the setting up of distribution centers.
Still, Kok is confident the sector will keep growing. “This is just the beginning for the industry,” he said. – Roumina Pablo