Refrigerated Trucks Usher In Opportunities In China

By Author: Guchen EAC
Total Articles: 19
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New volume of cold chain warehouse trucks

With the multiple impacts of African swine fever and new crown pneumonia, food safety has become a widespread concern. In order to ensure the supply of meat and food safety, the government has issued a series of policies that require "from transferring pigs to transferring meat", encouraging "north-to-south transfer" and "last mile", and prohibiting "live poultry trading" in various places. The demand for cold chain logistics is growing. This has brought new volume to the refrigerated transport vehicle field, or will promote the continued development of this segment.

From "hot fresh meat" to "cold fresh meat", demand for refrigerated trucks is growing rapidly

In the past, the transportation of live pigs in China used barn-type transport vehicles for cross-regional transportation, which could easily become a "risk source" for the spread of epidemics during the epidemic. Therefore, on the one hand, the Chinese government has strengthened prevention and control measures, implemented a registration system for pig transportation vehicles, and promoted the change of "adjusted ...
... pig" to "adjusted meat"; on the other hand, it has promoted "centralized slaughter, brand management, cold chain circulation, and cold fresh listing". To maintain the normal circulation order of live pig products and make people "affordable to eat meat." Large pig farmers such as Muyuan have begun to establish an integrated base for breeding, slaughtering, storage and transportation.

Beginning at the end of 2018, the African swine fever epidemic in China has spread, prompting China to shift from "hot fresh meat" to "cold fresh meat". China's domestic pork "cold fresh meat" cargo volume and average distance per order have risen sharply. In August 2019, the volume of pork "cold fresh meat" transportation was nearly 10 times that of the same period in 2018, which became the "tipping point" of the meat refrigerated truck market since 2019.

According to relevant sources, the output of China's refrigerated trucks was 48,000 in 2019, an increase of 18% year-on-year. With the steady improvement of the epidemic, the increase in cold chain logistics and the increase in the summer solstice, the requirement for freshness of fruits, vegetables and meat is higher, and the demand for refrigerated trucks will enter the peak season.

The epidemic is a challenge to the industry. Since the beginning of this year, affected by the "double" epidemic, many changes have taken place in pork supply and marketing channels and residents' consumption habits. In particular, it has accelerated the replacement of "cold fresh meat" with "hot fresh meat", the cancellation of live poultry slaughter, and the huge amount of fresh poultry. The demand for refrigerated meat distribution has caused the e-commerce distribution business to present a "blowout" state; in addition, a large amount of capital has poured into the pig breeding and meat processing market, which is giving birth to a rising sub-industry-cold chain transportation equipment. With the gradual replacement of barn-type transport vehicles that used to carry live pigs by refrigerated transport vehicles (meat trailers), it means the upgrading of new technologies and the opening of new logistics methods.

Long-term rapid growth

According to statistics, China's domestic meat market is currently in a situation where the main production area and the main consumption area are separated. Therefore, a large number of meat products need to be transported in different places. With the increase of restrictions on the transportation of live livestock and poultry, a large number of freight needs cold chain transportation.

From the perspective of transportation structure, China's refrigerated truck ownership accounts for the proportion of total trucks, which is much lower than that of developed countries in the cold chain transportation industry, and the refrigerated truck market has huge room for growth. With the release of China's policy dividends, the improvement of people's living standards, and the demand for cold chain logistics, the refrigerated truck market has huge growth potential in the future.

Relevant data shows that in the past three years, the average growth rate of China's refrigerated truck market is about 30%, and it is expected to continue to maintain rapid growth in 2020, with demand for 55,000 to 60,000 vehicles, of which the sales of refrigerated meat trailers in 2020 will be 3500 to 4,000.

The "home economy" is rising against the trend, what are the potential opportunities in China's refrigerated truck industry? China's fresh food logistics has entered a long-term growth cycle as the service industry's share of GDP increases. This trend will fundamentally increase the demand for refrigerated semi-trailers and refrigerated vans in China. The outbreak of African swine fever has accelerated this process; during the new crown pneumonia epidemic, the demand for home delivery of fresh food has ignited the demand for refrigerated vans.

I am Isabella S Johnna, Working at Guchen EAC. We are the top manufacturer of HVAC systems, including bus air conditioning, 12V air conditioner for van, electric AC compressor etc.Guchen EAC manufactures and exports a wide range of electric AC compressor, both high voltage (DC320V, DC350V, DC380V) and low volt compressors (DC12V, DC72V).