During recent time, globally the FMCG industry has been observing an unprecedented growth. Now the need for packaged and processed foods along with beverages is very rapidly increasing globally. Also, food and other perishable materials’ transport is growing fast. There is a big growth in number of cold storages in most of the countries. The corona pandemic has once again reminded us of the importance of transporting vaccines and drugs maintaining a particular temperature.
All these together have boosted the demand for industrial refrigeration systems to an extent, which is unprecedented. With this background, let us now have a look at the growth trend of the industrial refrigeration systems – based on the findings of some well-known market research groups. These will make the trend clear without the need for any further explanation.
Observations of market research company Grand View Research
According to a recent report by Grand View Research, “The global industrial refrigeration systems market size accounted for USD 19.10 billion in 2021 and is anticipated to expand at a CAGR of 4.3% from 2022 to 2030. Globally, the use of processed and packaged foods and drinks and the need to prevent spoilage are causing the demand for industrial refrigeration systems to increase. Concerns over global warming have forced manufacturers to focus on natural refrigerants over harmful coolants. In recent years, the market for genuine refrigerant-based equipment has overgrown due to natural refrigerants being inexpensive to produce and climate-neutral. Over the forecast period, the market is expected to be impacted by the emergence of enhanced and improved cold chain systems across the globe.”
Grand View’s report also states, “E-commerce grocery sales are growing faster throughout the world than physical grocery sales. Additionally, cold chains play an integral role by minimizing harvest spoilage using technologies such as evaporator /passive coolers and absorption refrigerators. High temperatures and excessive heat, in addition to agro-climatic conditions, contribute to market growth. In developing countries, however, cold chain deployments are low due to fewer budgets allocated for advanced equipment.”
Focus of the industry
According to Grand View researchers, “Leading players in the market are focusing on advancements in technology to provide simplified solutions. For example: Emerson Electric Co., cold chain solutions provider and an HVAC, partnered with Carrier in March 2021 to offer advanced solutions from its air conditioning and cold chain businesses, including sensors, valves, and compressors. Companies are focusing on environmentally friendly technology such as Active Magnetic Regenerative refrigeration.” The technology requires magnetic solid, which acts as a refrigerant using magneto caloric effect and reduces energy consumption by almost 30%. Besides these technology Artificial Intelligence, next-generation technology, and the Internet of Things create opportunities for manufacturers.
Towards adopting natural refrigerants
The Grand View’ report also points towards a trend of using natural chemicals as refrigerants. It states, “Natural refrigerants such as CO2, hydrocarbons, and ammonia pose threats of toxicity (NH3) and inflammation. However, their use has reduced the emission of greenhouse gases. Manufacturers are steadily switching to natural refrigerant options as they focus on the refrigerants’ Global Warming Potential (GWP) and Ozone Depletion Potential (ODP) due to increasing awareness among consumers. For instance, in July 2021, Bitzer Kühlmaschinenbau GmbH introduced a new compact compressor CSW85/95 to improve efficiency in water-cooled liquid chillers as water-cooled systems are becoming popular in Europe due to the regulations projected by the Ecodesign Directive.”
Effect of the pandemic
The onset of the pandemic has affected industrial operations as production hubs shut down due to lockdowns and quarantines imposed by governments worldwide. However, the market witnessed a demand for its products due to the global need for preserving vaccines in vast quantities to fight the extent of the pandemic. The U.S. Centers for Disease Control and Prevention (CDC) have suggested using pharmaceutical, or specially designed refrigerators or freezers, to properly store vaccines. The guidelines for storage of vaccines indicated storage temperature between 2°C and 8°C for refrigerators and -50°C and -15°C for freezers. As a result, the need for storing and distributing vaccines and effectual pharmaceuticals preserved the market.
Market outlook of the PS Market Research
PS Market Research’s recent report has specially focused on the growth trend based on constituent components’ growth. According to them, the industrial refrigeration systems market revenue is expected to grow from $26.8 billion in 2019 to $41.1 billion in 2030, at a CAGR of 5.0% during 2020–2030. The market is primarily being driven by the rising use of refrigerators in the chemical and pharmaceutical industries and growing food processing and cold chain sectors.
However, the market has witnessed subdued growth in 2020 due to the COVID-19 pandemic. Market players are facing issues such as the cancellation of orders and unavailability of raw materials, because the production of the final equipment and supply of raw materials and components, especially from China, have reduced tremendously. Besides, the restrictions on the import–export of products have hit the supply of refrigeration systems.
View of the 6W Research
According to 6Wresearch, India Industrial Refrigeration Systems Market size is anticipated to register growth during 2020-26. India’s industrial refrigeration systems market is expected to register high growth during 2021-2026 on account of the growing food processing industry in the country. Increasing government investment for the expansion and development of the food park projects would lead to further growth in demand for the industrial refrigeration systems market in the country.
According to them, based on applications, the food & beverage segment accounted for a leading share of market demand owing to the presence of a large food processing industry in the country. However, with a surge in investment in the pharmaceutical industry, it is expected to register high demand for industrial refrigeration systems over the coming years.
Prediction by MarketsandMarkets
According to a research report by MarketsandMarkets, the Industrial Refrigeration System Market is estimated to grow from USD 19.4 billion in 2021 to USD 25.1 billion by 2026 at a CAGR of 5.3% during 2021–2026. The growth of the industrial refrigeration system market is driven by factors such as growing inclination toward eco-friendly refrigerant-based refrigeration systems due to stringent regulatory policies, increasing government support to strengthen cold chain infrastructure in developing countries, and the rising demand for innovative and compact refrigeration systems.
Industrial refrigeration systems play a critical role in removing heat from large-scale processes or products and lowering their temperature or maintaining it at a desired level. These systems are usually deployed in dairy processing plants, cold storage facilities, and food and beverage processing firms to control the growth of harmful bacteria. With increasing government support to strengthen the cold chain infrastructure in developing countries, there are considerable opportunities soon for players operating in the industrial refrigeration system market.
By P. K. Chatterjee (PK)