- India needs to increase its cold storage facilities to accommodate the distribution of the COVID-19 vaccine within the country.
- India’s shortfall in cold storage lasted until before the outbreak, when food supplies in excess of refrigeration capacity led to wastage.
- That’s why experts believe that increased cold storage will have lasting benefits across all industries, even after the pandemic is over.
India has been debating the need for cold storage seemingly forever. The problem has arisen every time there is a food shortage, or whenever someone has argued in favor of allowing foreign direct investment (FDI) in multi-brand retail.
However, now the need to guarantee the supply of COVID-19 vaccines has triggered the emergency need to build extensive cold storage that is useful even after the pandemic.
India’s Cold Storage and COVID-19 Vaccine Bottleneck
India will need to administer around 1.7 billion doses of COVID-19 vaccine to immunize the majority of its adult population. While it is true that the country has more than ample means to manufacture the required doses of vaccine, it currently does not have enough cold storage to store everything.
“The limited cold storage capacity in India will be a big challenge. It will not be easy,” acknowledged Indian Health Secretary Rajesh Bhushan during a press conference last week.
The lack of standardized protocols, plagued by an unreliable power supply and the struggle to store even the most basic agricultural products are signs that India’s cold storage facilities will be put to the test as the country faces its biggest challenge yet.
| The challenge of cold storage: | |
| Total doses required to immunize the population of India | 1.66 billion |
| India’s Total Vaccine Manufacturing Capacity | 2.4 billion |
| Total Estimated Cold Storage Capacity of India | 450-550 million |
Source: company data, Credit Suisse estimates
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Logistics companies and airlines, key stakeholders in ensuring that the COVID-19 vaccine can get from one place to another, have the required capacity, but are even wrestling with the question of capacity.
How much cold storage does India need for COVID-19 vaccine?
To properly store COVID-19, the government will have to use a portion of the infrastructure available under the current immunization program and will need the support of private sector actors. But the use of the Expanded Program on Immunization (EPI) for the COVID-19 vaccine has yet to be officially announced.
| India’s cold storage capacity | Number of doses |
| Government capacity | 200-250 million |
| Private sector capacity | 250-300 million |
| TOTAL CAPACITY | 450-550 million |
Source: company data, Credit Suisse estimates
It is also the reason why the COVID-19 vaccines being developed by Pfizer and Moderna will not be feasible to distribute in the Indian market. Storing a vaccine at minus 70 degrees Celsius would require a significant amount from the existing system, as most of the country’s cold storage is only equipped to offer a temperature range of between two and eight degrees Celsius.
The COVID-19 vaccine candidates offered by Oxford, Johnson and Johnson and Novavax are the main candidates for distribution in India, mainly due to their ability to survive in warmer temperatures.
| Vaccine candidates and the temperatures they need to survive: | |
| Vaccine | Cold chain |
| Pfizer / BioNTech | -70 degrees Celsius |
| Modern | -20 degrees Celsius |
| Oxford / AstraZeneca | 2-8 degrees |
| Johnson and Johnson | 2-8 degrees |
| Novavax | 2-8 degrees |
Source: respective companiesCold Storage Opportunities After a Pandemic
Cold storage is part of the infrastructure and a real estate subsector that consists of large refrigerated warehouses and holds together the entire food supply of the country.
“The expansions and the launch of new services will offer lucrative opportunities for market players over the next five years,” noted an October MarketsandMarkets report. It establishes that India is the fastest growing country in Asia Pacific when it comes to the cold chain market.
According to Manoj Pant, regional business manager for Snowman Logistics, cold chain storage will play a critical role in storing perishable food after the pandemic. This ranges from e-commerce businesses to online pharmacies to organized meat and seafood retailing.
“The setbacks experienced by the food supply and storage chain due to the pandemic are raising concerns about India’s food security. A strong cold chain infrastructure is needed to strengthen the supply and storage of perishable goods for the population of India to be sufficient, ”he said.
| Typical temperatures for a cold storage facility: | |
| Temperature range | Allowed items |
| Below -18 degrees Celsius | Meat and seafood |
| 0 to 10 degrees Celsius | Dairy products, fruits, medicines and meats |
| 10 to 20 degrees Celsius | Flowers, fruits, vegetables and wine. |
| Above 20 degrees Celsius | Flowers and wine |
Source: CBRE
Real estate consultant CBRE agrees with Pant’s opinion. “Cold storage facilities play an integral role in improving the shelf life of products and are an important enabler for various industries working in the production and delivery of fresh food; along with health care and other products such as flowers and chemicals, ”said Anshuman Magazine, president of CBRE in India, Southeast Asia, the Middle East and Africa.
These are the reasons for the lack of cold storage infrastructure in India
The limited capacity to store at the temperatures required for a vaccine is only part of the equation. Even the existing infrastructure is not without its difficulties. The inadequacy of these facilities is further highlighted when looking at the wettest southern states, as noted by a CBRE Research report in October.
The facilities themselves are run by farmers or workers who do not necessarily know the correct procedure for handling the storage of medical equipment, such as vaccines. In their defense, the facilities themselves lack a focus on anything other than the incoming crops, especially onions, chili peppers, or potatoes. Even so, there are very few standards and protocols for running a cold storage facility in India.
Even if India wants to accelerate the development of cold storage facilities, most of the technology used to build them is currently imported from outside India. This increases costs and leaves India dependent on other countries.
As a country, India also needs to solve the problem of power outages that plague crop storage in cold storage facilities for years. Now it is more critical when it comes to COVID-19 vaccines.
The Indian Ministry of Energy states that the country’s maximum energy deficit is around 0.8%; however, uninterrupted power is still a problem.
The Indian government’s plan so far
In order to resolve these bottlenecks and successfully distribute the COVID-19 vaccine in India, the Ministry of Health has recommended that states stop working on individual distribution plans. Instead, they have been asked to create a database according to the model issued by the central government.
If the experts are to be believed, the expansion of cold storage is not only essential for the distribution of the COVID-19 vaccine, but also in terms of opportunities, it presents post-pandemic for a number of other sectors.
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