The investment landscape for the cold chain industry in Indonesia is\nconsidered to have bright prospects due to the vast needs of the\ndomestic market. However, the development of this sector still faces\nchallenges regarding the component industry, supply chains, and energy\nlimitations in several remote areas.<\/p>\n
Herlin Herlianika, President of the American Society of Heating,\nRefrigerating and Air-Conditioning Engineers (ASHRAE) Indonesia Chapter\nand a senior consultant in HVAC, stated that domestic demand is a\nprimary factor maintaining the investment prospects for cold chains in\nIndonesia. She noted that population growth and increased economic\nactivity will drive the need for cooling systems, particularly for the\nstorage and distribution of food and healthcare products.<\/p>\n
\u201cInvestment interest remains high because the Indonesian government\nremains open. We see many strategic programmes from the President, such\nas the fishing villages programme, where the cold chain should truly\nrevitalise,\u201d Her andlianika said at the Nusantara International\nConvention Exhibition (NICE) in Jakarta.<\/p>\n
She noted that the development of regions with large populations will\ncreate a demand for cold chain facilities, thereby expanding the growth\nspace for the domestic cooling business. This prospect is reflected in\nthe relatively high growth of Indonesia\u2019s cooling industry; while global\ngrowth is around 8% per annum, Indonesia has recorded growth of\napproximately 15%.<\/p>\n
Given these conditions, Herlianika expects the cold chain industry to\nmaintain a growth rate of around 15% this year. She believes political\nstability and the resumption of government projects could act as\ncatalysts for private investment.<\/p>\n
Due to the high domestic demand, industry players in Indonesia remain\nmore focused on fulfilling the domestic market rather than exports.\nExisting industrial capacity is largely absorbed by domestic needs,\nmeaning Indonesia actually requires additional cold chain production\nfacilities.<\/p>\n
\u201cWe do not need to focus on exports for now because our domestic\nfactories are already at full capacity; Indonesia actually needs more\nfactories,\u201d she added. She further noted that the need for cold chains\nextends beyond the food sector to healthcare, including the storage of\nvaccines and other medical products, playing a vital role in maintaining\nproduct quality and safety during storage and distribution.<\/p>\n
Component Industry Remains Weak<\/strong><\/p>\n Despite the promising outlook, Herlianika stated that the national\ncold chain industry still faces issues regarding the spare parts\nindustry. While Indonesian cold chain manufacturers are capable of\nproducing coils and performing design and equipment selection, this\ncapability has not been matched by sufficient development in the spare\nparts industry. Consequently, much of the component needs must still be\nmet through imports.<\/p>\n This issue, according to Herlianika, is closely linked to production\neconomics. Certain components require large production volumes to\nachieve competitive pricing. For example, compressors require a\nproduction scale of approximately 10,000 units to reach a certain level\nof economic viability. This situation requires investors to calculate\nmarket volumes before building component production facilities in\nIndonesia.<\/p>\n \u201cMeanwhile, we must compete with established products that are\nundoubtedly much cheaper in terms of price,\u201d she said.<\/p>\n Therefore, Herlianika hopes the government will provide investment\ncertainty and ease of licensing to encourage the development of\nsupporting cold chain industries. Additionally, the government needs to\ncreate a cost structure that allows domestic producers to compete with\nimports, including through policies regarding aluminium and steel raw\nmaterials.<\/p>\n \u201cThe hope is for investment certainty, ease of licensing from the\ngovernment, and protection from export competition,\u201d she added. However,\nshe emphasised that government support must be balanced with\nimprovements in industrial quality. Businesses should not merely engage\nin assembly but must produce products with adequate technology and\ndurability.<\/p>\n Yongkie Tilano, a Board Member of ASHRAE Indonesia, stated that\nseveral technologies are being developed to reduce dependence on\nconventional energy. This includes the use of insulation to help\nmaintain product temperatures during distribution and the development of\nsolar energy as an alternative power source for cold chain systems.<\/p>\n \u201cThere is also progress in using solar thermal energy to provide\nenergy for crossroads. We have not yet reached ideal mitigation; there\nare still many deficiencies,\u201d Tilano remarked.<\/p>\n Nevertheless, Tilano believes that the development of refrigeration\nand cold chain technology must continue to meet industrial needs and\nstrengthen national supply chain resilience. He noted that strengthening\nthe cold chain is increasingly important for Indonesia, as the\ndistribution of fresh products from regions far from consumption centres\nrequires storage and transport systems with precise temperature\ncontrol.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/cold-chain-investment-growth-amid-component-industry-challenges-1789034064",
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