By Dawie Kriel, head of business development at EP Refrigeration – a division of Energy Partners and part of the PSG group of companies
South Africa’s food production and export industries are experiencing encouraging growth injections from the increase in demand for high value and diversified produce such as blueberries, macadamia nuts and citrus.
The export demand in the blueberry industry alone is expected to grow by at least 44 000 tonnes by 2024. A critical enabling factor to support this growth is a combination of investing in the latest refrigeration technology and improving the capacity and reliability of cold storage infrastructure.
The increase in exotic fruit exports will require businesses to think differently about how they invest in technology. Berry products fetch a higher price per kilogram than most other agricultural exports from South Africa, and we will see that more companies are going to spend capital on high-tech facilities to account for their sensitivity to temperature changes.
On the export of citrus, several factors have made for a growing export industry. The trend in product development like new variants that are easier to peel and seedless (making them more popular) is continuing, and of course the higher demand for products containing vitamin C – which is being driven by the ongoing health awareness resulting from the pandemic. Keeping in mind that South Africa is currently the world’s second largest exporter of citrus – and we are still expanding with new orchard plantings – we can expect citrus to be another bigger driver of cold storage development.
The macadamia nut production industry, with annual production outputs expected to reach around 60 000 tonnes by the end of this year, is another example of an industry that also requires significant refrigeration infrastructure. The need for high-tech solutions in this space is vital to improve quality and reduce energy costs and will definitely grow over the next seven years as the new trees come into production.
With these developments in mind and the added regulatory cold sterilisation requirements that form part of global food safety and logistics standards, the refrigeration industry is likely to see a notable increase in activity and complexity as the country’s food production industry shifts and evolves over the coming years. Investing in refrigeration infrastructure that is highly energy efficient, delivers on sustainability, reporting requirements, improves reliability and ultimately reduces cost will be imperative.
The country’s infrastructure problems will only make for more severe challenges for refrigeration-reliant companies. The combination of on-going loadshedding, bottlenecks at our ports and the decaying road infrastructure requires cold storage and transport infrastructure to hold products for longer durations of time before shipping can take place. More sustainable cold storage and insulation as well as proper servicing of refrigeration equipment is going to become paramount. With increased power cuts, a higher number of maintenance issues are going to be inevitable, which is why having a well-thought-out service plan for one’s refrigeration systems will become more and more important to avoid unplanned downtime.
The cost of energy in South Africa is also set to increase at above-inflation rates for quite a few years to come. Therefore, investing in those high-tech cooling solutions that are less energy-intensive will help companies to contain their costs at competitive levels. There is definitely a business case to be made for pairing one’s refrigeration system with a renewable energy solution like solar power as well.
While opportunities for the food production industry will certainly grow exponentially, businesses will need to make the right moves to ensure that they are ready. Thinking out of the box to make use of innovative products like servitisation models (Cooling as a Service) and partnering with an experienced and reliable service provider in the refrigeration industry for design, build and servicing should be every company’s first point of call.