Yokorei builds $52 mln Vietnam cold storage facility as sector set to soar

Japanese refrigerated warehousing business Yokorei is constructing a $52 million refrigerated warehouse near Ho Chi Minh City, Vietnam’s economic powerhouse, with the cold storage logistics sector set to soar in the country.

The company, a major player in the refrigerated warehousing business, is building the facility on a site of around 4.5 hectares in Long An province’s Ben Luc district, which borders HCMC.

The site covers lots B18-1, B19-1, B20-1 and B21-1 in Phu An Thanh Industrial Park, as seen in Yokorei’s investment certificate for the project – the Japanese firm’s first investment in Vietnam.

Yokorei received the certificate in late July. The project will start a trial run in next year’s third quarter and open for commercial operations by March 2025.

A quarter of the total investment for the project, or $13 million, is Yokorei’s equity. The other three quarters – $39 million – will be from capital mobilization, according to the investment certificate.

The state-of-the-art cold storage facility will keep temperature sensitive products safe, serving farm produce, aqua-products, food and other items.

The project is expected to enhance the Vietnamese cold storage logistics sector, which is set to soar.

According to global property services company Cushman & Wakefield, Vietnam's cold storage logistics industry is poised to achieve a market value over $440 million by 2025. Despite this rapid expansion assumption, the cold storage sector remains considerably below its full potential. As of May 2021, Vietnam possessed a mere 48 cold storage warehouses, encompassing a capacity of approximately 700,000 pallets. Notably, only 8.2% of domestic food manufacturers implemented cold chain systems, whereas export manufacturers constituted 66.7% in 2020.

Post-harvest losses in Vietnam represent around 20-25% of total losses, equivalent to an estimated $3.9 billion annually, market research and consulting firm Ken Research said in a release Tuesday.

To address this issue, the Vietnamese government aims to decrease the loss rate to less than 10%, Ken Research said. Implementing a cold chain system presents a convenient solution to extend the shelf life of perishable products, minimizing losses and maximizing the value of agricultural goods.

“Vietnam's cold storage logistics industry can be said to be to an untapped resource, awaiting exploration and expansion. The projected growth trajectory signifies a promising future, yet the existing state calls for transformative measures,” Ken Research wrote in the release.