Lessons from India: Investors, experts task government, banks on cold chain industry development

By Samson Echenim

• Developing agriculture without cold chain leads to 55% produce waste

Promoters and investors in the cold chain industry and private sector energy providers have called on both federal and state governments and the banks to put all hands on deck to develop Nigeria’s cold chain subsector which they say is indispensable in government’s deliberate plans to develop agriculture.

Globally, about $13 billion worth of agricultural produce is lost between harvest and consumption due to lack of cold storage. Nigeria’s post-harvest losses are put at $9 billion, accounting for nearly 70 percent of global post-harvest loss.

At the 2nd West Africa Cold Chain Summit and Exhibition (WACCSE) held recently in Lagos, which was themed, “Unclucking practical cold chain solutions in Africa,” experts called on government and the banks to join hands with the private sector in harnessing the cold chain subsector, which has the potential of creating millions of jobs, while saving over 55 percent loss of farm produce.

They concluded that “government is key, the private sector is key and banks are key too.”

Anurag Agarwal, CEO, and co-founder, New Leaf Dynamic Technologies Limited, New Delhi, India in his keynote presentation recommended the biomass initiative for Nigeria, which he said India had adopted in the last 10 years to provide the huge energy needed by cold stores.

India is second largest producer of fruits and vegetable. According to Agarwal, Indian farmers are moving to horticulture– growing fruits and vegetables which triples their income.

“Lack of adequate efficient cold chain infrastructure leads to massive post-harvest losses estimated at $13 billion annually. “The Indian government is providing financial assistance for cold chain and educating farmers on the need to store their produce and adopt the biomass solution.

“Horticulture needs cold storage, else there will be loss due to market glut. India needs cooling for 500 million tons per year and now India has sufficient power to meet requirements,” Agarwal said.

Tunde Okoya, president, Organisation for Technology Advancement of Cold Chain in West Africa (OTACCWA), which organised the WACCSE, said the Nigerian government should borrow a leave from Indian government which provides direct subsidy for cold chain facilities.

He said, “This is ideal way to go. Nigeria can also borrow from India’s biomass model, an off-grid solution where farmers burn the waste on their farmland to generate cooling and we have lots of farm waste in Nigeria. We need to unlock practical cold chain solutions to grow and develop our cold chain industry that will not only impact farmers’ income, but also add value to our foods and create millions of jobs for Nigeria’s teeming youth population.

“For example, tomato is easy to store and can double values for a month by 55 percent. Cabbage can raise value by 82 percent. Storage enables farmers not to sell at low rates but can sell later during off season, with prices rising up to 250 percent in September for instance.”

According to him, the capacity of the cold chain in Nigeria is estimated to be at 250,000 cubic while the estimated supply-demand gap is between 4-5 billion cubic.

He noted that the huge gap is an indication that the country still has a lot to do in developing its cold storage and logistics industry.

According to Okoya, the goal of OTACCWA is to shape government policies as regards cold chain through advocacy by ensuring that the country has policies in place that will further reduce investment costs.

Nearl de Beer, director, Innovation Process Solutions, Guateng, South Africa said Nigeria with her huge population and massive arable land for agriculture can grow food for the African continent. According to him, his company is introducing its cold room technology, Arcticstore to Nigeria, in partnership with Titans Containers.

While providing facts from the private sector energy providers perspective, Felix Ekundayo, CEO Asiko Power Limited, Lagos, builders of LPG-powered cold rooms in Nigeria, said in a bid to cut energy cost for cooling, his the company has shifted to building generators for cooling relying more on natural gas and LPG.

“We need to rely more on them for electricity to quicken development of cold chain,” he noted.

Joseph Uwaifo Ajayi. Lecturer at the Department of Mechanical Engineering, Federal University of Petroleum Resources, Effurun, Warri, Delta State, who spoke on “Unlucking practical cold chain solution: Design, Cost and operational considerations,” observed that there is increasing demand for fresh foods against processed ones and the cold chain remained the surest method to keep foods such fruits, vegetables, milk and meat fresh.  He advised investors to always deploy strategic cost management to maximise energy.

Also speaking on “The energy conundrum of cold chain development in Africa: Pathways to suitable solutions, Tony Tiyon CEO and editor-in-chief, Renewables in Africa Ltd, London, said only 10 percent of perishable agricultural produce are refrigerated globally, which used up $30 billion worth of energy in just one year.

“Cold chain has the highest energy demand per cubic foot. $30 billion worth of energy used per year. Diesel engine no longer suitable. However, up to 73 percent of energy can actually be saved,” he said.