UAE Cold Chain Market Size and Forecast (2019-2029)

Executive Summary

The UAE cold chain market has experienced notable growth in recent years with market growing by a compound annual growth rate (CAGR) of 8.42% between 2020 to 2023. This growth is primarily driven by the increasing demand for perishable goods, a population surge that has crossed 10 million, expanding e-commerce, and the need to maintain the quality of temperature-sensitive products. Key sectors driving demand include pharmaceuticals, vaccines, and food products like dairy, seafood, fruits, and vegetables. Additionally, government investments in logistics infrastructure and modern cold storage facilities have played a crucial role in ensuring food security and supporting market expansion.

The country recognized as one of the leading logistics hubs in the MENA region, benefits from its advanced infrastructure. The country boasts 12 commercial ports and a cargo capacity of 80 million tonnes annually, facilitating the smooth transport of cold chain goods. The cold chain market is supported by both local and international operators managing advanced infrastructure, ensuring efficient services across industries. In March 2023, the logistics sector was further strengthened by the inauguration of the 900 km Etihad Rail network, significantly enhancing the transport of goods across the Emirates and contributing to the cold chain’s expansion.

Innovations in Logistics

Innovations such as drones and autonomous vehicles are increasingly being adopted to improve operational efficiency and reduce delivery times. The country’s warehousing hubs, including Dubai Logistics City and Jebel Ali Free Zone, host state-of-the-art, temperature-controlled facilities that cater to the growing demand for logistics services. These facilities are particularly critical for the food and pharmaceutical sectors, with the latter expected to grow by 27% between 2021 and 2025, highlighting the importance of cold storage for temperature-sensitive pharmaceutical products.

Challenges Facing the UAE Cold Chain Market

Despite robust growth, the market faces several challenges. High operating costs, particularly for energy and labor, have led to increased operational expenses. Additionally, the UAE’s extreme climate exacerbates these costs, creating a challenging environment for maintaining optimal storage temperatures. Infrastructure disparities between the Emirates also present obstacles, as certain regions lag in modern cold storage facilities and transportation networks. Moreover, regional competition is intensifying, especially from countries like Saudi Arabia, which is also heavily investing in its cold chain infrastructure.

Despite these challenges, the UAE cold chain market is positioned for continued expansion, driven by the growing demand for temperature-controlled logistics services, especially from the food and pharmaceutical industries. Government initiatives, such as the Dubai Logistics Strategy 2020 and Abu Dhabi Economic Vision 2030, continue to support infrastructure development and trade facilitation. Addressing challenges related to high operational costs and infrastructure gaps will be critical to maintaining the market's upward trajectory. With sustained investments and technological advancements, the UAE is set to remain a key player in the global cold chain logistics sector.

Future Outlook of the UAE Cold Chain Market:

The UAE cold chain market is set for substantial growth, with a compound annual growth rate (CAGR) of 7.98% projected from 2024 to 2029. This expansion is primarily driven by the UAE’s increasing population and urbanization, which is expected to result in a significant rise in warehouse demand. In Dubai, for instance, a 1% increase in population is anticipated to lead to a 0.5% boost in warehouse capacity.

Another key driver of this growth is the pharmaceutical sector, forecasted to grow by 27% between 2021 and 2025. The rising demand for temperature-controlled storage, essential for handling sensitive pharmaceutical products, will be critical in supporting this expansion.

Tourism is another vital factor contributing to the cold chain market's growth. The sector is expected to contribute AED 450 billion (USD 122.5 billion) to the UAE’s GDP by 2031. Government initiatives, such as Multiple-Entry and Golden Visas, are projected to boost food consumption, further accelerating the development of cold chain infrastructure.

Scope of the UAE Cold Chain Market Report:

Makreo Research has published a comprehensive report titled “UAE Cold Chain Market Size and Forecast (2019-2029) - Analysis by Emirates, Cold Chain Type, Temperature Range, and Industry Applications”. This in-depth analysis examines the historical performance and current status of the UAE cold chain market, identifying key opportunities and drivers that will influence its future growth.

The report begins by assessing the UAE’s economic, political, technological, and demographic factors and their impact on the cold chain market. It then explores the logistics and warehousing sector, highlighting key trends, warehouse rental rates, and logistics infrastructure. Subsequently, the report provides a detailed examination of the UAE cold chain market, focusing on the prevalence of cold storage, rental rates, key locations, and market segments and their respective shares.

Furthermore, it highlights significant companies within the UAE cold chain market, analysing their merger and acquisition activities, funding timelines, services offered, pallet locations, temperature ranges, and more. The report also addresses the challenges and opportunities present in the UAE cold chain market and offers a future outlook. This report equips stakeholders with a thorough analysis of the UAE cold chain market, enhancing their understanding of its current state, future growth potential, and strategic investment opportunities.

Period of Study:

• 2020 - 2023: Past and Present Scenario
• 2023: Base year of study
• 2024 – 2029: Future Prospects

Emirates Covered

• Abu Dhabi Emirate
• Dubai Emirate
• Sharjah Emirate
• Ajman Emirate

Market Segmentation Covered

• Segmentation: by Type of Temperature-Controlled Storage
• Segmentation: by Emirates
• Segmentation: by Application
• Application by Food Sector
• Application by Pharmaceuticals

Competitive Landscape

This section provides a detailed market comparison of key players in the UAE cold chain market based on various parameters such pallet positions, temperature ranges, geographic presence and certifications etc. It also highlights their recent investments, merges and acquisitions (M&A), and funding activities. Additionally, it includes comprehensive profiles of selected industry players, covering their financials and latest business activities.

Companies Covered

• Gulf Warehousing Company Q.P.S.C
• Dubai Ports (DP) World Ltd
• Gulf Agency Company Ltd. (GAC)
• Emirates SkyCargo
• Arab-American Express (Aramex)
• Global Shipping And Logistics LLC (GSL)
• Mohebi Logistics LLC
• Rais Hassan Saadi (RHS) Logistics LLC
• RSA Global
• Tameem Logistics & Warehousing
• Al-Futtaim Logistics LLC
• DHL Group
• CEVA Logistics
• Hellmann Worldwide Logistics SE & Co. KG.

Key Questions Answered:

1. What is the current state of the logistics and warehousing sector in the UAE?

2. How is the UAE's transport infrastructure structured and developed?

3. Which are the major trade zones and industrial hubs in the UAE?

4. How has the performance of the UAE's cold chain market, both past and present, influenced the overall logistics industry?

5. What are the key benefits and strategic importance of establishing cold storage facilities in the UAE?

6. What are the guidelines for starting a cold chain business in the UAE?

7. What are the rental rates for cold storage facilities across different regions in the UAE?

8. Who are the major players in the UAE cold chain market, and what are their core business activities?

9. What significant mergers, acquisitions, and funding activities have impacted the UAE cold chain market?

10. What future opportunities and prospects exist for growth in the UAE cold chain market ? Show more