Report Overview

Increasing demand for temperature-controlled logistics in the food and pharmaceutical sectors, rising consumer awareness regarding product quality and safety, expansion of the cold chain infrastructure, and government initiatives drive the growth of the Saudi Arabia Refrigerated Transport Market.

Saudi Arabia Refrigerated Transport Market - Industry Trends & Forecast Report, 2029

Saudi Arabia refrigerated transport market size was estimated at USD 4.17 billion in 2022. During the forecast period between 2023 and 2029, the Saudi Arabia refrigerated transport market size is projected to grow at a CAGR of 7.90% reaching a value of USD 7.12 billion by 2029. The growth of the food and beverages industry, expanding international trade, investments in cold chain infrastructure, regulatory requirements, changing consumer preferences, and the rise of e-commerce have collectively contributed to the increasing demand for refrigerated transport in Saudi Arabia. This trend is likely to continue as the country's economy develops and the consumption of perishable goods rises. For instance, Saudi Arabia has been investing in the development of cold chain infrastructure to support the growth of refrigerated transport. For example, the Saudi Food and Drug Authority (SFDA) has implemented regulations for cold chain logistics and storage facilities to ensure the safety and quality of perishable goods. Various companies and logistics providers have been investing in temperature-controlled warehouses, refrigerated vehicles, and specialized equipment to meet the demand for refrigerated transport services.

Saudi Arabia Refrigerated Transport Market – Overview

Refrigerated transport, also known as temperature-controlled transport or cold chain logistics, refers to the transportation of goods that require specific temperature conditions to maintain their quality, freshness, and safety throughout the supply chain. It involves the use of specialized vehicles, such as refrigerated trucks or containers, equipped with refrigeration or cooling systems to control and maintain the desired temperature range during transit. Refrigerated transport is essential for perishable products, including food and beverages, pharmaceuticals, flowers, chemicals, and other temperature-sensitive goods. The transportation process ensures that these goods are kept at the appropriate temperature, preventing spoilage, degradation, or the growth of harmful microorganisms. The refrigeration systems in these transport vehicles maintain the desired temperature range, typically between -25°C to +25°C (-13°F to +77°F), depending on the specific requirements of the cargo.

Saudi Arabia Refrigerated Transport Market

Growth Drivers

Expansion of Refrigerated Warehouses

The business is being spurred by the expansion of refrigerated warehouses, the expansion of pharmaceutical sectors, and the development of food and beverage sectors. Dozens of refrigerated warehouses are built to provide excellent transit conditions for temperature-sensitive food products. Several export industries rely on the critical linkages provided by their solution system. Because end-to-end security is a weak link in the system, businesses invest millions of dollars in refrigerated transport operations to build effective, efficient, and dependable processes. A single failure in this chain might result in catastrophic product and capital losses. The oil & gas industry is the major revenue-generating industry in the Kingdom of Saudi Arabia. The ongoing initiatives are taken by the government, such as Saudi Vision 2030, to diversify the income sources and have planned to spend $810 billion of investments in culture, leisure, and entertainment projects, thereby fueling the construction of world-class infrastructure in the country.

Restraints

High Energy Costs and Requirement for Significant Capital Investment

Refrigerated transport relies on refrigeration systems to maintain the desired temperature range during transit. These systems require a continuous supply of energy to operate and maintain the cooling or freezing capabilities. In Saudi Arabia, where energy costs can be relatively high, the operational expenses for refrigerated transport can increase significantly. The cost of electricity or fuel needed to power the refrigeration systems adds to the overall transportation costs, impacting the profitability of refrigerated transport operators.

Impact of COVID-19 on Saudi Arabia Refrigerated Transport Market

The COVID-19 pandemic significantly impacted the Saudi refrigerated transport market. The outbreak and subsequent measures to control the virus, such as lockdowns, travel restrictions, and border closures, disrupted supply chains and logistics operations. The closure of businesses and restaurants, as well as reduced consumer spending, led to a decrease in demand for perishable goods, affecting the volume of refrigerated transport services required. Also, the pandemic introduced new challenges and requirements for the industry. Stricter hygiene and safety protocols were implemented, leading to increased sanitation measures and additional costs for cleaning and disinfecting vehicles and storage facilities. Social distancing measures also affected the workforce, potentially impacting staffing levels and operations.

Saudi Arabia Refrigerated Transport Market

Segmental Coverage

Saudi Arabia Refrigerated Transport Market - By Mode of Transportation

By mode of transportation, the Saudi refrigerated transport market is segmented into railways, airways, roadways, and waterways. The roadways transport segment dominates the market. Refrigerated MHCV are used for medium-distance transportation from one city to another. These semi-trucks are also employed when perishable items must be delivered on time. Trucks are used to deliver perishable items such as fish, meat, milk, and dairy products. The increased usage of multi-temperature refrigerated systems allows for the delivery of more than one perishable item at a time, enhancing truck transportation efficiency.

Saudi Arabia Refrigerated Transport Market - By Technology

On the basis of technology, the Saudi refrigerated transport market is classified into vapor compression systems, air-blown evaporators, eutectic devices, and cryogenic systems. The air-blown evaporator segment holds a significant share of the market as it helps maintain a consistent temperature and prevents temperature fluctuations, ensuring the quality and freshness of perishable goods during transportation. The demand for refrigerated transport services in Saudi Arabia has been driven by factors such as the growth of the food and beverage industry, expanding international trade, changing consumer preferences, and the need for compliance with food safety and quality regulations. These factors contribute to the overall market growth, which encompasses various refrigeration technologies, including air-blown evaporators.

Saudi Arabia Refrigerated Transport Market - By Temperature

On the basis of temperature, the Saudi refrigerated transport market is split into Single-Temperature and Multi-Temperature segments. With the expansion of the food service business, the fleet of multi-temperature refrigerated trailers has grown in size and importance. Evaporators and host unit controls in multi-temperature refrigerated trailers enable varied temperatures in one trailer. Microprocessors now regulate, monitor, pre-trip, and troubleshoot each temperature zone within the whole multi-temperature system.

Saudi Arabia Refrigerated Transport Market – By Application

By application, the market is bifurcated into Chilled Food Products and Frozen Food Products segments. The chilled food products segment plays a significant role in the refrigerated transport market in Saudi Arabia. Chilled food products refer to perishable goods that require transportation and storage at temperatures above freezing but below room temperature to maintain their quality and freshness. In Saudi Arabia, the demand for chilled food products has been increasing due to factors such as population growth, changing consumer preferences, urbanization, and an expanding food retail sector. Consumers are seeking convenient and ready-to-eat food options, including fresh fruits and vegetables, dairy products, bakery items, prepared meals, and other perishable food items.

Competitive Landscape

The Saudi Arabia refrigerated transport market is consolidated in nature. Major players in the market include Al Faisaliah Logistics, Al-Khaldi Holding Company, Abdullah Fouad Holding Company, Tristar Transport, and Hala Supply Chain Services. Product/service launches, approvals, patents, and events, as well as acquisitions, partnerships, and collaborations, are all major strategies used by companies.

Scope of the Report

By Product

• Railways

• Airways

• Roadways

• Waterways

By Technology

• Vapor Compression Systems

• Air-Blown Evaporators

• Eutectic Devices

• Cryogenic Systems

By Temperature

• Single-Temperature

• Multi-Temperature

By Application

• Chilled Food Products

• Frozen Food Products