Saudi Arabia Cold Chain Logistics Market - Growth, Trends, Covid-19 Impact, and Forecasts (2022 - 2027)

Saudi Arabia Cold Chain Logistics Market - Growth, Trends, Covid-19 Impact, and Forecasts (2022 - 2027)

Saudi Arabia's cold chain logistics market was valued at USD 0.97 billion in 2020 and is expected to reach a value of USD 2.96 billion by 2026, registering a CAGR of 11.85% over the period.

The growing urban population and changing consumer perceptions have boosted the demand for refrigerated storage and transport. The market for refrigerated/frozen products is rapidly growing in Saudi Arabia.

The implementation of the cold chain in the Saudi Arabia involves several challenges. One of the major challenges is the lack of integrated supply chains or limited integrated supply chains from farm to fork, coupled with lack of standardization.

With the COVID-19 pandemic challenging the economies, it has upended the cold chain logistics sector through massive changes in operations, supply chains, regulations, and manpower requirements. It has also transformed the market with a lasting impact on the future.

The halal food market in Saudi Arabia has grown due to increased demand for packaged halal foods among non-Muslims, strong import and export regulations and policies regarding halal food and products, and an increasing Muslim population in the country.

Another key sector that requires cold chain logistics in the pharmaceutical industry, which has been growing rapidly in Saudi Arabia. Different government-sponsored incentive schemes enabled several domestic players to form joint ventures and collaborations with global and regional pharma corporations, intending to grow domestic manufacture and supply to various sections of the country.

Key Market TrendsGrowth of Pharmaceuticals Supporting Cold Chain Logistics:

The Saudi Pharma market is looked at as one of the fastest-growing markets today with strong export potentials to serve MENA and OIC (Organization of Islamic Countries) with a total market of USD 120 billion. The demand for pharmaceuticals in Saudi Arabia is expected to register substantial growth owing to the increasing penetration of health insurance companies and the rising incidence rate of non-communicable diseases.

Furthermore, the exceptional rise in the per capita income of Saudi Arabia is also expected to foster the demand for branded pharmaceutical drugs. Another key factor driving the growth of the pharmaceutical market in Saudi Arabia is the country’s strategic move to allow 100% FDI in the pharmaceuticals sector.

The Saudi Arabian pharmaceutical drugs market was estimated to be worth USD 10.19 billion in 2020 and is expected to grow at an annual rate of 7.3% over the next six years. Saudi Arabia has more than 40 registered pharmaceutical factories, covering 36% of the local market need for medicines. The Kingdom’s pharmaceutical sector exports more than SAR 1.5 billion (USD 0.4 billion) annually and is estimated to grow at 5% a year.

Rapid reforms in the healthcare sector in Saudi Arabia by the government and multinational companies is expected to propel growth of the Saudi Arabia pharmaceutical drugs market. As of today, Saudi Arabia imports all its biological molecules, making it 100% dependent on outside products. To address this, the National Transformation Plan aims to localize 40% of the pharmaceutical sector and reduce its import dependency.

Growth of Imported Meats demanding the cold storage:

Saudi Arabia is the largest importer of food and agricultural products among the Gulf Cooperation Council (GCC) countries, with a population more than double that of the five GCC states (the United Arab Emirates, Kuwait, Qatar, Oman and Bahrain), together. The Saudi poultry sector has experienced a major production growth in recent years.

Saudi Arabia was the fifth-largest importer of broiler meat across the world. Notably, majority of the imports of poultry products in the country were accounted by Brazil, capturing a share of more than 70% of the total imports, followed by France, Ukraine, and the United Arab Emirates.

The Kingdom of Saudi Arabia has a magnanimous demand for poultry meat, and it has been dependent on imports from other countries to satiate its demand. Thus, the country has been indulging in several trade deals with major meat-producing countries over the years. In 2020, Saudi Arabia imported a total of 652,283 mt. of chicken meat and products of which Brazil supplied 72% (467,522 mt.).

Saudi Arabia is largest consumer of red meat among the GCC countries, with meat majorly imported from Australia, the United States, Brazil and other countries. Saudi Arabia per capita meat consumption is highest in the world, amounted nearly 50 kg. The growth in red meat consumption, production and import of live animals for their auspicious occasion, i.e., Eid al Adha feast, utilization of hajj meat that is managed by Islamic Development Bank, rise in import of red meat and government support are some of the major factors driving cold chain logistics in Saudi Arabia as these products have low shelf life.

Competitive Landscape

Saudi Arabia Cold Chain logistics market is fragmented. The cost of labor, land, and energy is consistently rising in Saudi Arabia. Thus, companies providing cold storage facilities to their clients are implementing automation technologies such as Automated Storages and Retrieval Systems, Cloud Storage, Internet of Things, etc., to gain competitive advantage.

Major players in the cold chain market include Agility Logistics, Mosanada Logistics, Takhzeen Logistics, Wared Logistics, United Warehouse Company, Almajdouie, AL Jelaidan, and Others.

Riyadh currently has the largest number of cold storage warehouses. The city acts as a hub through which products are transported to other regions of the country.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

Companies Mentioned
 
Mosanada Logistics Services
Wared Logistics
Agility Logistics
NAQEL Express
Coldstores Group of Saudi Arabia
Al
Theyab Global Logistics
IFFCO Logistics
Almajdouie Logistics
Camel Party Logistics
United Warehouse Company
Takzheen Logistics*

Please note: This publisher does offer titles that are created upon receipt of order. If you are purchasing a PDF Email Delivery option above, the report will take approximately 2 business days to prepare and deliver.