A Cold Chain Meltdown

The demand for frozen food is growing exponentially after the pandemic resorted the way consumers shop online and prepare for the future. This marked shift in consumer behavior will put pressure on warehouses and carriers with cold storage ability to continue supplying frozen foods to grocery stores. Skyrocketing demand for warehouse space when capacity is limited already by record-setting import levels is expected to drive up prices for what little space remains and doubly so for climate-controlled warehouses and freezers. 

At the start of the pandemic, the state of perishable and frozen goods looked very different than we currently have. The average cost per mile to ship by refrigerated truck was approximately $2.93/mile in January 2020 but climbed to $4.97/mile currently, and other metrics are just as out of balance. Available warehouse space averaged 8.5% in 2016 but dwindled to 5.6% in the fourth quarter of 2021. Demand for warehouse management services are currently 56% higher than this time last year and, incredibly, 267% higher than the final quarter of 2021 - an industry that is expected to grow to $6.1 billion by 2026. To call this a growing market is almost laughably temperate considering the expectations. 

Shopping trends are irreversibly contorted in a post-pandemic world. Consumers are still looking for quality fresh products, but they understand how things have changed and how critical it is for families to have subsistence when supply chains are upended and shelves start to empty out in crisis. Dry goods to stock a pantry and frozen foods became staples and remain in high demand. We don’t expect the lessons of the past two years to be forgotten anytime soon and shoppers will need the logistics industry to step up and ensure the adequate supply has a safe and appropriate warehousing and distribution plan ready for frozen and perishable goods. 

At SecurCapital, it’s our passion to keep an eye on emerging markets and sustaining trends that benefit our customers and protect their futures. The growing perishable market and expanding need for refrigerated trucking and storage won’t be filled anytime soon. We expect the consumer sensibility to remain focused on protecting their future and planning for the very worst moments that might again derail business as usual and require families to turn to their reserves until the world resettles. 

If you are interested in knowing more about how SecurCapital is planning for every contingency in a truly brave new world, make some time to chat with us and learn more about our plan for the future.