Market Insights: The Refrigerated Transport Industry

Refrigerated transport is an integral part of the Australian logistics scheme to provide fresh food and produce to a population of 25 million people. Australia’s low population density and high levels of distance and rurality contribute to the importance of having reliable, temperature-controlled, and conditioned freight transportation for perishable food items. We believe that in order to continually provide quality transport solutions to the foodservice industry, an understanding of the refrigerated transport industry as a whole is essential.

Transportation of Perishable Foods

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The perishable food items that are most regularly transported by refrigerated trucks include confectionery, fruits and vegetables, dairy products, seafood, fish and meat. This is the only form of transportation that is capable of transporting perishable goods for long distances as a temperature-controlled system allows food to be stored for longer, and ensures year-round availability of seasonal products.

Using refrigerated transportation logistics, Queensland can supply fresh and frozen meats, fruits, beverages and any perishable goods to local supermarkets and restaurants around Australia.

A Growing Industry

As the food and beverage industry continues to grow, so does the refrigerated transport industry market share. According to MarketsandMarkets, the global refrigerated transport market is projected to grow to USD $21.6 billion by 2025. This shows a compound annual growth rate of 5.8% from 2019 to 2025.

The key factor causing this growth is the increasing demand for the service from foodservice operators such as restaurants, hotels and other eateries. Other growth opportunities include:

Rising adoption of eCommerce in the food industry
Increase in food delivery services
Rising government investment to improve the transport industry
Growing frozen food consumption

Refrigerated Transport Industry COVID-19 Impact

The Australian government recently announced a $17.6 billion stimulus package for businesses including the refrigerated transport industry. The package includes:

Increasing the instant asset write-off from $30,000 to $150,000. Backing Business Investment incentive to allow businesses with less than a $500 million turnover to deduct 50% of a new asset cost.
Job keeper payments to help businesses retain their employees.
Wage subsidies to support apprentices or trainees training with a small business. Subsidy of 50% of an apprentice’s or trainee’s wage for up to nine months.
Boosting cash flow for employers that will provide up to $25,000 (tax-free) back to small and medium-sized businesses, with a minimum payment of $2000 for eligible businesses.

Resulting Employment Opportunities

The foodservice industry is an essential service required globally and throughout Australia. There is an ongoing domestic demand for food, and our agricultural sector is well-positioned to respond. With a decrease in international food imports, there will be an increase in food supply chains, including refrigerated transportation to effectively transport food throughout Australia. The rapidly increasing demand for food products is evident through panic buying, and businesses should look towards continuity plans to remain competitive in a locked-down country.

With more businesses being supported by the government to invest in assets that can help the food and agribusiness sectors, there will be an expected rise in employment opportunities for Australians.

Importance of Keeping the Transportation Industry Afloat

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There have been calls to the Government to reduce operating costs for the transport sector.

If these are taken into consideration for the duration of the COVID-19 emergency, it will ensure that food, fuel, medical supplies, and other essential materials will get to where they are needed.

Although the transportation industry is experiencing hardship with a decline in imports and exports from China, we believe that this is a short-term problem and government incentives can be leveraged as a solution to regain traction. It’s critical that we do everything possible to maintain a fully functional supply chain in Australia.

Invest in a Scully RSV Refrigerated Truck

The government’s instant asset write off incentive combined with Scully RSV’s refrigerated transport solutions allow retail supermarkets, produce growers, foodservice distributors as well as manufacturers the opportunity to invest in refrigerated transport and strengthen the supply chain.

Scully RSV is an Australian owned and operated refrigerated truck company with over 30 years of international buying, trading and manufacturing experience. Scully RSV maintains a trusted reputation at the forefront of the refrigerated transport industry.

Our range of trucks available for purchase include: