THE HEAT IS ON

All of us deal with perishable products every day yet probably give them little thought. We have ingrained and we follow our own little “cold chain” procedures. For instance, would you go and buy a bottle of milk or a frozen pizza and then spend three hours walking around the shopping center?

No, of course not. We’re all too aware that in that “last mile” supply chain from supermarket to home, the clock starts ticking as soon the item is picked from the store’s cold compartment, and there is only a limited time to get back and put it away in the fridge, otherwise, the product will literally perish, along with our few dollars of “investment” in it.

But further upstream in the supply chain, things are not looking so good. In fact, it is estimated that globally, a US$35 billion of perishable goods’ value is wasted every year – through inadequate cold chain infrastructure and specialized equipment, poor processes, and a low level of skills and training.

The situation in Asia seems particularly acute. According to Transport Intelligence, in India, the world’s largest fruit supplier, 30 percent of fresh produce regularly goes to waste. In China, a lack of cold chain facilities is hampering food & beverage MNCs from setting up in second and third tier cities. Even Japan, the world’s biggest importer of air-flown temperature controlled products, has no cold store at Tokyo’s main airport.

Without proper investment, the problem is likely to get worse because of factors such as changing consumer habits – less wet market, more supermarket, and a globalizing food manufacturing industry that is extending the distance between farm/factory and fork.

When it comes to pharmaceutical products, the problems caused by “temperature excursions” can be particularly serious. The active ingredients in medicines can separate from the “filler” when exposed to high temperatures, with potentially dangerous consequences for the patient, according to DHL’s Angelos Orfanos.

The good news is that there should be plenty of business out there for suppliers of cold chain storage and transport systems and for specialist consultants and trainers. In August, Singapore’s SATS announced a US$8.6 million investment in Coolport @ Changi. Set to open in Q1 2010, the 8,000 square meter on-airport facility will feature multi-tiered temperature zones for handling commodities such as live seafood, ornamental fish, meats, flowers, and pharmaceutical products including vaccines.

Fittingly (and deliberately), the announcement was made during a gala lunch for SATS’ customers, partners, and invited media. The guests eagerly tucked into the sumptuous array of fresh food that had arrived at its final stop on the cold supply chain, and obviously successfully, because it tasted great.