HCMCity (VNS/VNA) - The COVID-19 pandemic has worsened the shortage ofcold storage space in Ho Chi Minh City and surrounding areas as goods pile upas a result of lack of demand.
NguyenThanh Khue, director of a food import company in the city, said: "Goodscannot be exported, imported goods cannot be sold because people limitspending, and so inventories continue to increase. Many enterprises that planto import have to stop because there is no storage space.”
Theprice of renting cold storage in city is 0.8-1 USD per tonne per day. Butsince investing in cold storage is very expensive, enterprises mainly rentspace, he said.
GeneralSecretary of the Vietnam Association of Seafood Exporters and Producers (VASEP)Truong Dinh Hoe said seafood companies face a severe shortage of cold storagespace, forcing them to cut purchases of fresh produce.
Itwould be difficult for Vietnam to find new markets after the pandemic, he said.
VASEPhas asked the Ministry of Agriculture and Rural Development for policy supportto help companies build their own cold storage facilities with a minimumcapacity of 5,000 pallets including long-term loans without interest for thefirst two years and a 50 percent rate cut for the next four and a 50 percent cutcorporate income tax for the first two years for cold storage businesses.
Thedomestic market too needs cold storage for the distribution of foods, and thisdemand is increasing with the development of modern retail, it said.
"Seafoodprocessing factories now have cold storage facilities in place but theircapacity is small and only meets a part of demand, and the rest must beoutsourced. If their storage capacity is larger, businesses can buy more fromfarmers.”
Realestate research firm CBRE Vietnam told the media that the lack of cold storageunits was an opportunity for the cold storage sector. The growth of onlinesales and multi-channel retail could be an advantage for firms that have coldstorage units near cities.
Lastmonth ABA Cooltrans, Vietnam’s leading cold chain logistics provider,inaugurated a new refrigerated distribution centre at the Linh Trung II ExportProcessing Zone in HCM City’s Thu Duc District.
Itis the company’s third distribution centre after one more in HCM City andanother in Hanoi. It increases the company's total area to around5,000 square metres and capacity to 8,000 tonnes.
Withits strategic location, the new centre, which cost 250 billion VND (10.76million USD), is expected to meet ABA customers’ expanding storage,distribution and delivery needs for frozen and fresh foods in HCM City andother cities in the south-east.
Accordingto a report by FiinGroup, an integrated service provider of financial data,business information, industry research, and other services, Việt Nam’s totalcold storage capacity stood at 600,234 pallets in 2018.
Itsaid due to rising demand for cold storage services, many providers areexpected to expand.
KenResearch, a global publisher of market intelligence, said in 2016-2021 Vietnam’scold chain industry achieved estimated CAGR of 10.4 percent thanks to itsgrowing number of supermarkets and seafood exporters.
Itestimated the market to grow to 1.8 billion USD by next year./.
VNA