Monitoring solutions play a larger role in the cold chain than any other type of supply chain. They ensure that products are safe, and fresh, under strict temperature requirements. Without monitoring, most products could lose effectivenessand potentially endanger someone’s life. As the cold chain business rises in demand, so does the need for better monitoring solutions.
A market analysis report was published in 2019 about the situation of cold chain monitoring sector. It says that the sector is projected to be worth 45 billion dollars by 2025, from 19.46 billion dollars in 2020. Because of the rise of processed foods, biologics, generic drugs, and the overall need for an efficient supply chain, the cold chain monitoring services are estimated to have an annual growth rate of 18 percent.
The report segmented the results per component (software and hardware), logistics (storage and transport), application (food, pharmaceuticals, etc.), region (Asia Pacific, North America, Africa, etc.). Here is the projection of each segment:
Rise in Components
For cold chain monitoring to work well, it involves the use of advanced hardware and software. Both components propel the growth of cold chain monitoring. Advances in tracking technologies have made cold chain more efficient, leading to better results, more investors, and a healthier bottom line.
Some monitoring hardware is deemed innovative, such as Radio Frequency Identification (RFID) devices, Internet of Things (IoT) devices, and telematics and telemetry devices. Moreover, some present technologies are being improved over the years. These are temperature, humidity, and air quality sensors, data loggers, and networking devices. Among these developments, telematics is projected to have the fastest growth through the forecast period of 2025. Telematics solutions equal visibility. They allow for real-time tracking of distant vehicles, also called fleet management, at the same time tracking packages and temperatures while in transit.
Advances in software enable the control and collection of data from devices. Software is further divided into on-premise and cloud services. On-premise is running the software at the helm of the operator while cloud services make use of data center companies to run the software. Cloud-based software is forecast to have the fastest growth. Cloud-based software is better than on-premises as it allows for distant monitoring of temperatures, vehicles, and packages. Examples include cloud-based inventory management software, robotics, barcode scanners, and RFID technology. All of these help speed up the process of monitoring, identifying, and economizing without having to invest in in-house infrastructures and maintenance.
Developments in logistics have introduced improved processes. Logistics is segmented into two: storage and transport. Shipments entering the storage places are an important factor to consider, especially in cold chain. Monitoring the products in the packaging, vehicles, or containers helps keep the products fresh and stable upon delivery. One study projected an increasing demand for better storage solutions. This growth has been brought by a rise in remote monitoring of cold chain storage, as more sensitive products, such as biologics, require good packaging, with monitoring solutions.
The transport segment is expected to have the fastest rate of growth. Transport and storage work go hand in hand. As the demand for storage solutions increases, so does the demand for better transport. Temperature-sensitive products in the cold chain need to travel in a strict temperature range that only temperature-specific vehicles can provide. Refrigerated trucks will likely be more in demand as more countries participate in the production and distribution of biological-based and cold-reliant pharmaceuticals.
Both storage and transport must be provided not just with cooling technologies, but also with monitoring technologies. Remote temperature monitoring solutions prevent temperature excursions or deviations which could lead to a more fatal consequences, such as a loss of efficacy. In other words, effective remote monitoring solutions help prevent public health risks from the consumption of spoiled and ineffective pharmaceuticals. Hence, it makes sense to expect exponential growth of monitoring solutions for logistics in the coming years.
Growth per Market
The cold chain is indebted to certain markets that have increased their demand. Some companies, such as the food market, have made use of cold chain monitoring solutions for decades, same goes for pharmaceuticals. The advent of newer and more sensitive biological products from certain regions such as China and India, has been driving the growth of cold chain monitoring even further.
In the study, the cold chain monitoring is segmented into eight different applications: fruits and vegetables; fruit pulp and concentrates; dairy products; fish, meat and seafood; processed food; pharmaceuticals; bakery & confectionaries; and others. The processed food segment will likely have the highest compound annual growth rate (CAGR) of the forecast period. That’s because of the changing diet of the majority and the preference for quality processed foods. The largest segment in 2018, however, was still the fish, meat, and seafood sector, and will still be the largest segment of cold chain monitoring applications until the projection year of 2025.
Aside from processed food, the pharmaceutical sector will also drive the growth of cold chain monitoring. This growth is attributed to the need for more stringent regulations and procedures for pharmaceutical products. Cold chain operators opt for better temperature sensors and technologies because these products are required to be maintained at a specific temperature wherever they are, in transport or in storage,
Growth Per Region
While cold chain monitoring is expected to rise in every area, some regions have a bigger portion than others. The study was segmented further into North America, Europe, Asia Pacific, Middle East and Africa, and South America. The Asia Pacific region is set to be the fastest-growing region for the cold chain monitoring market. Countries such as India and China will contribute a large portion of the regional rise. The growth comes from increasing populations, industrialization, improvements in transportation and warehousing networks, and the growth of canned and processed food.
In China, more investments are coming in for the development of its monitoring infrastructures. Such technologies include temperature sensors and smart sensors. This is in line with China favoring the development of advanced pharmaceutical products such as vaccines, blood components, proteins, cell tissues, etc.
Countries such as the USA and Canada, from the North American region, will remain as the biggest contributors to the growth of cold chain monitoring, with a market share of 35.66 percent. Due to more efficient logistics infrastructures, smooth transport of cold chain products is to be expected in these regions. Aside from North America, Europe has always been one of the biggest market producers and consumers of cold chain monitoring services. In the forecast years, both regions will outperform their previous statistics because of the rollout of new medicines, globalization of food sources, and the entry of other countries into the markets.
Companies to Take Part in the Growth
Several companies have larger market shares than others. These companies, along with their ever-improving monitoring solutions, will tackle the need for visibility in the cold chain. They are Orbcomm, Sensitech, Berlinger & Co., Monnit, Controlant, Elpro-Buchs, Securerf Corporation, Savi Technology, Zest Labs, and Infratab, among others. Their constant search and innovation of products will increase their share in the market.
For instance, in August 2017, Orbcomm launched an advanced cold chain monitoring solution named PT6000. It claimed to have logistics, fuel and temperature management, maintenance, and regulatory compliance for refrigerated assets in transportation.
Monnit Corporation, from the US, provides low-cost wireless sensors for effective cold chain monitoring, gateway solutions to connect wireless devices, and software solutions to monitor and manage the deployed devices. These offerings have solidified their positions in the market. Another key player in the cold chain monitoring market is Berlinger, and Co.AB, from Switzerland. They offer mainly advanced monitoring solutions such as data loggers, temperature sensors, wireless sensors, and GPS or GPRS-based sensors, software solutions, and more.
These are just some best examples of companies poised to take a larger share of the market because of their innovative solutions and their attempts to have a better cold chain monitoring service.
As the world comes to a halt during this pandemic, some companies had to slow down their operations. Some areas, however, such as food production and food delivery, because of their demand, are still as mobile as ever. Despite this situation, the cold chain monitoring sector is still set to have a compound growth rate of 12.5 percent yearly, until the forecast period of 2025. Even after 2025, more is to be expected in the monitoring solutions, in their advances and market shares. That’s why it’s safe to assume that cold chain monitoring won’t slow down any time soon.