Refrigerated transportation is a booming industry that is truly changing the world. From globalization to food safety and the life sciences, learn how refrigerated transportation has a growing impact on our everyday lives.
Refrigerated transportation (or reefer freight) is a method for shipping freight that requires special, temperature controlled vehicles. The vehicle transporting the products being shipped has a built-in refrigeration system that keeps products at a desired temperature throughout the transportation process.
The first rudimentary version of refrigerated transportation was born in the 1800s, when cargo transporters would place ice and salt below temperature-sensitive goods in train cars. This process was horribly inefficient and inevitably led to major losses in the value of goods and profitability.
In the 1900s, more efficient modes of refrigerated transportation were developed, and improvements in technology have given us cold chain logistics, which has become a massive industry and continues to grow.
For many product types, refrigerated transportation is not an option, it is an absolute necessity. The benefits of refrigerated transportation are centered around safety, compliance and basic supply and demand.
The most obvious benefit of refrigerated transportation is that it keeps products from deteriorating and losing their value during the transportation process. This is not only true for food, such as produce, meat and dairy, but also for other sensitive items such as medical products and pharmaceuticals.
Refrigerated transportation allows products in need of temperature-controlled transportation to be moved from point A to point B more quickly and efficiently than alternative modes of transportation. Because of this, items in high-demand, such as fresh meat and seafood, rely on refrigerated transportation.
When people think of the types of products that necessitate refrigerated freight, the mind goes straight to perishable foods. In truth, refrigerated or temperature-controlled transportation is necessary for many other types of products, ranging from precious art to valuable chemicals and personal care products.
Recent regulations have made it absolutely imperative for shippers to seek out and implement refrigerated transportation. We will explore this further in the following section.
The refrigerated transportation industry is booming. In fact, the refrigerated transportation market in the US is projected to grow at a compound annual growth rate of 12.44 percent from 2014 to 2019.
The market is projected to reach 3.25 billion tons by 2022.
There are a variety of reasons for this growth:
The first is increased scrutiny by the FDA for safe food handling throughout the supply chain from manufacturer to the end user. One of the obvious pieces of the supply chain is temperature controlled vehicles for safe transportation of the product as to maintain freshness and prevent foodborne illness.
In fact, in 2015, the FDA’s Food Safety Modernization Act (FSMA) ruled that transporters of refrigerated freight be required to implement procedures for complying with provisions for temperature control, as well as the way this information would be relayed to both shippers and the end user.
The Act also included stricter requirements for training drivers on temperature management and reporting for each shipment.
The Act has been referred to as “The most comprehensive food transport rule ever imposed on the industry.”
Companies which have successfully adapted to these regulations are the most qualified long term partners for shippers seeking to move refrigerated freight.
“The transportation of temperature-sensitive products along a supply chain through thermal and refrigerated packaging methods and the logistical planning to protect the integrity of these shipments” (Hofstra University).
Refrigerated transportation isn’t just about logistics and getting a set of perishable items from point A to point B; it’s about understanding how specific products need to be transported based on their perishability, and ensuring that the transportation methods used to move products are iron-clad and compliant.
The global trade of perishable items has increased in the past years and is projected to continue increasing. This has caused high demand for quick transportation of fresh perishable goods.
But while globalization increases demand for products to be shipped overseas, it also relies on regional transportation as well as local transportation. The modes of transportation to bring a product from Greece to New York are different than those to transport that same product from New York to Chicago and Chicago to North Dakota. This can range from maritime transport in refrigerated containers to regional transportation in reefer trucks to local refrigerated courier service.
The cold chain has also contributed to economic development. Developing countries have fewer barriers to entry in when it comes to both consuming and producing perishable goods.
The Life-Science and Pharmaceutical industries have also experienced tremendous growth over the past decade and are set to continue growing and evolving.
In fact, as of March 2017, Pharmaceutical cold chain logistics is a $13.4-billion global industry.
The development of temperature-controlled products in the pharmaceutical and life sciences industry is growing at more than double the rate of non-temperature controlled products. Pharmaceutical Commerce estimates that by 2021, pharmaceutical cold-chain logistics will be worth $16.6 billion.
Technological innovation in these fields has led to the creation of more and more products that need temperature controlled environments to maintain their integrity and effectiveness.
Based on increasing demand and regulation, the future of refrigerated freight is bright.
However, refrigerated transportation is a niche industry and is far more expensive to provide than the transportation of dry goods.
For example, while an average 40 foot container for transporting dry goods costs around $5,000, a reefer the same size can cost around $30,000.
While there is competition within the industry, the specialized nature of the services and the training necessary to provide the best possible service stop many transporters of dry goods from entering into the market.
There is a lot more to transporting a pallet of produce, meat, fish, or dairy than there is in transporting a pallet of paper. And people will always have a need to consume fresh food!
Additionally, while some companies are equipped with dedicated fleets for the transportation of dry goods, it is much more difficult for a company that lacks the core competency of refrigerated transportation to maintain its own fleet and manage its own logistics.
This constitutes an area in which Third Party Logistics providers can save money and increase efficiency for shippers.
This makes established refrigerated delivery service providers in the industry such as Winnesota an ideal partner.
Winnesota has made a concerted effort to hire and train the best staff in the industry. We take safety and training very seriously and are continually monitoring our fleet from the time we pick the product up until it is delivered.
Professionalism of our contractors and meeting our service to commitments to our customers are our number one mission.
To learn more about Winnesota’s refrigerated delivery services, visit our services page.
To learn more about the industry, check out our resources.
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