Cold Chain Monitoring Market Size Global Forecast to 2026 | MarketsandMarkets

Posted by Steve Stark on December 6th, 2021

The Cold chain monitoring market is expected to grow at a CAGR of 16.6 %, from USD 4.7 billion in 2021 to USD 10.2 billion in 2026.

The primary reasons for this rise in demand for cold chain monitoring products in pharmaceuticals & healthcare application.

Driver: Increasing global demand for temperature sensitive-drugs

There is an increase in demand for temperature-sensitive drugs such as vaccines and products that are dependent on particular temperature ranges for chemical stability. According to the International Institute of Refrigeration (IIR), the demand for heat-sensitive health products such as drugs, vaccines, insulin, derived blood products, and oncology products is rising globally every year. Hence, the transportation of these drugs is the most critical phase in the cold chain due to the possibility of unforeseen environmental variations. Any change in temperature during transportation can affect the medicines, losing their potency to cure the ailments they are meant for, thereby leading to ineffective treatment in many cases. To avoid the degradation of any pharmaceutical product, it is crucial to maintain parameters with respect to the product-specific environment, including air quality levels and temperature ranges. Further, providing end-to-end visibility and condition monitoring at the packaging stage of the products throughout the pharma supply chain operation is of utmost importance. As manufactured drugs contain high-value active ingredients that have a shorter shelf life and strict temperature requirements, the need for temperature control and monitoring through the entire supply chain has increased. Therefore, temperature-sensitive pharma products require cold chain monitoring solutions. Cold chain monitoring and tracking refer to controlling devices equipped with sensors that ensure the transportation of temperature-sensitive products at a given temperature range, that is, between 2 and 8°C.

Restraint: High cost of implementation

The installation cost of cold chain monitoring systems is significantly high. Deploying sensors and putting the connectivity network in place requires a high cost. Shipping high-value consignments over long distances within their prescribed temperature range require a huge investment. Therefore, companies involved in cold storage and cold transportation remain skeptical about spending on developing monitoring networks. Cost is the major hindering factor to introducing real-time cold chain monitoring systems, particularly for small- and medium-sized players, and many participants in the food industry are SMEs, which are often operating on lean margins. The massive size of the cold chain market requires high investments in cold chain monitoring solutions. These solutions are of two types: active refrigeration systems and passive cooling devices. Although passive cooling solutions may seem basic, the cost for setting up the cold chain is quite high. Large-scale players involved in the cold chain network can spend the necessary amount and get the benefit from the increased reliability over a much shorter timeframe. However, smaller players generally refrain from spending on such monitoring devices as they cannot recover their money. The impact of this restraint is high. The high cost of cold chain monitoring solutions would be holding back the growth of the cold chain monitoring market.

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Opportunity: Better control of assets in warehouses using automation and cold storage technologies

A large warehouse witnesses different temperature zones. Hence, continuous temperature monitoring is essential to check the temperature at which goods are stored and the actual condition of these goods. For the best utilization of warehouses, complete control over valuable equipment can be achieved by the adoption of automation, including the use of robotic equipment to carry out inter-warehouse stock movements and loading and unloading activities. Warehouse automation aids efficient storage space utilization, reduces wear and tear, increases reliability, and reduces operating costs. Real-time visibility about shipment location, temperature, humidity, and other environmental factors enables manufacturers and distributors to take faster preventive actions, thereby reducing the risk of spoilage or contamination. Maintaining temperature at an optimum level, coupled with efficient energy management, that is, the use of automated storage and retrieval systems (ASRS), can reduce warehouse energy costs from 35 to 50% as automated warehouses offer more storage in less refrigerated space. The long-term storage of frozen foods and other perishable consumer products is one of the largest problems in the cold storage supply chain. By automating processes such as stock rotation, monitoring goods in transit, transport, and location management processes, warehouses can ensure that they are always distributing fresh items. RFID chips and scanners track expiry dates, and automated picking systems can locate these expired goods for separation and disposal. Several kinds of medicines, vaccines, and various types of farm products such as fruits, vegetables, and eggs are preserved at constant temperatures due to their sensitive nature as they are prone to spoilage during transport and storage due to physical wear and tear. Contamination and spoilage can cause substantial losses. Thus, automation in warehouses can reduce such losses.

Challenge: Complexities involved in the installation and monitoring of cold chain monitoring solutions

Cold chain monitoring has become even more complex in recent years because of the rapid increase in customer expectations. Globalization has increased customer choices and the complexity of multi-sourcing supply chains. Cold chain networks can be spread out in terms of area as they can extend from manufacturing plants, laboratories, and storage warehouses to various transportation modes and end users such as retail chains and restaurants. Installing various sensors across all these locations can be a daunting task. Additionally, the distributed network needs to be mapped to efficiently manage the data generated from these sensors. Further, this data has to be analyzed, and actionable data has to be generated to maximize the profit. It is generally difficult to map such a vast network and derive useful data from it. Hence, issues such as scale visualization, error type pinpointing, and the formulation of responses could prove to be challenging.

Sensors, data loggers, and other devices need to be calibrated for specific applications as per their requirements. Networking devices are also required to provide ample connectivity support in various locations, thereby increasing the burden on installation service providers in the cold chain monitoring market. The market players need to overcome these challenges to provide better monitoring services across cold chains.