Sunday, January 20 2019

VietNamNews

Cold chain logistics improving

Update: December, 28/2018 - 09:00
In the past ten years, the capacity of cold chain supply in Việt Nam has increased four times and the infrastructure in cold supply is often operated with a capacity of over 90 per cent. — Photo baomoi.com
Viet Nam News

HÀ NỘI — Although the cold chain logistics sector in Việt Nam is considered small and fragmented, the market has shown signs of improvement due to the increasing demand for high quality products.

With the foundation of agricultural production and rapid economic growth, Việt Nam is facing challenges in food waste as well as difficulties in logistics management for cold and cool supply chains.

According to David Appel, president of Carrier Transicold & Refrigeration Systems, cold chain logistics have long been fragmented in Việt Nam, with small- and medium-sized service providers offering only localised services and not for the entire food supply chain.

Meanwhile, the traditional trade channel accounted for 86 per cent of the value of retail contributions in Việt Nam such as markets, grocery stores, restaurants and distribution systems.

The Vietnam Academy of Agricultural Sciences once reported that in Việt Nam, the cold storage stage is only focused on seafood products because they are mainly exported, while other agricultural products do not use cold storage.

Together with increasing demand for quality food from consumers, food supply enterprises are beginning to have stricter demands in the quality of cold logistics services, prioritising the application of information technology systems in operational management, supervision and compliance to ensure food safety and hygiene.

Chad Ovel, general director of Mekong Capital, said the freshness of food is an important factor, deciding the number of customers buying and returning. This promotes the development of the market and that is the reason why Mekong Capital decided to invest in a cold chain supplier in Việt Nam.

Over the past ten years, the capacity of cold chain supply in Việt Nam has increased four times and the infrastructure is often operated with a capacity of over 90 per cent, Appel added.

Currently, the cold chain logistics market in Việt Nam recognises the presence of foreign investors mainly developing large-scale cold storage systems such as CLK Cold Storage, FM Logistics and Emergent Cold. Most domestic enterprises hold the transport market of cold products, including Tân Bảo An and ABA Cooltrans.

ABA Cooltrans’ representative said speed of development and urbanisation, as well as modern distribution systems, will be the premise for developing value chains, including cold supply investment in the value chain.

In fact, the cold logistics market is in a development stage with great potential, and it is expected that more businesses will join this market. The opportunity to cut down on food waste and improve food distribution will be more effective through the application of cold storage technology.

However, to be able to apply the technology successfully and effectively, it is necessary to understand the actual needs in each locality and market.

This means that Vietnamese supply chain service providers need to understand what their customers want. Enterprises must be sure about this issue to provide optimal solutions for the supply chain, thereby improving the procurement process.

At the same time, in order to compete and create trust for customers using the service, businesses will need more breakthroughs in quality, cargo temperature must be ensured and maintain a cold chain during operation, experts suggested. — VNS

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