Home » SCMAP Perspective » Back on the Cold Chain

These past few weeks I’ve seen many posts on social media about farmers up in the north having to throw away their harvest—truckloads of carrots, in this instance —because they can’t sell them. Oversupply, they say.

 

The same story was on television news one night. My sister was expressing regret over the situation.

 

“Well, saan naman kasi nila ilalagay lahat ng gulay na ‘yan?” I asked her.

 

“Sa mga organization,” she answered. “Sa mga orphanage, ganun.”

 

“Still, saan nila ilalagay ‘yung mga gulay kapag nasa kanila na?” I had images in my head of storage rooms filled with carrots, and every meal being made out of carrots. It’s a cartoonish thought, I’ll admit.

 

These stories point to a disconnect between supply and demand. Vegetable farmers are taking advantage of the cooler weather in recent months to grow products which they can later sell at the market, not just in their communities but further afield. In the capital, at least, we constantly see vegetables from the Cordillera sold in stores. The demand is constant: it’s not like we as a society stop eating vegetables for months at a time.

 

But growing season is not year round. Farmers recognize this, but it is not easy for them to ensure they can provide their products across the year without sacrificing quality. And with much competition coming from bigger farms and importers, the end result is an abundance of unsold product, which they have no choice but to dispose of, rather than continue selling it until it rots.

 

To combat this, stakeholders must significantly invest in improving the entire supply chain, from farms to table. This won’t happen overnight, but ideally this covers all points: educating farmers on new techniques and technologies that would allow them to increase the quality of their wares; building better physical and virtual links connecting farms to retailers; establishing and maintaining logistics hubs with cold chain capabilities that are accessible not just to retailers but to farmers as well.

 

I did say it won’t happen overnight. Cold chain, for instance, requires a lot of capital. A good supply chain ensures the quality of the product as it is being transported from one point to another. In the case of cold chain, it means investing in specially-built warehouses, with different specifications. It means investing in special equipment to maintain optimal temperatures within the warehouse. (This depends on the product; some items, like meats and seafood, may require temperatures of -25C or lower.) It means investing in special refrigerated vans that will keep items frozen as they are brought from warehouse to store. Perhaps reefer containers too, if you’re transporting by sea.

 

Nowadays technology is playing a bigger role in ensuring cold chains better maintain the quality of the products going through it. There’s a greater emphasis on traceability, with sensors tracking not just the location of the product, but also where it was farmed, who farmed it, and how it was process—certainly a boon as consumers begin to look more into the provenance of the food they eat. Special sensors can also monitor whether the temperature of a particular container has dropped, and where, allowing supply chain managers to improve their processes, perhaps in real time.

 

Cold chain does require a lot of investment, both in initial outlay and in maintenance, what with the high cost of power in this country. And yet there is a continued interest in establishing cold storage facilities. There is a robust cold chain sector, and in recent years, we’ve seen new players enter the space. However, these new facilities tend to be bigger and closer to markets than to producers, perhaps to optimize investment levels.

 

But what if we considerably expand our cold chain networks to be more inclusive? What about, say, smaller cold storage facilities near farms and fishports? The government can lead this effort, perhaps to complement the planned food exchange facility in New Clark City, as well as efforts to expand cold chain capabilities with the help of the United States government. Apart from ensuring good quality of agricultural products, and allowing farmers to earn more year-round, all this can vastly improve food security in the Philippines, particularly during typhoon season. And perhaps we won’t have to wonder why farmers don’t just donate truckloads of carrots to orphanages.

 

2019 Supply Chain Outlook: Incidentally, we are tackling the role of supply chain in ensuring food security in this year’s Supply Chain Outlook, happening on February 8, from 12nn to 4pm, at the EDSA Shangri-la in Mandaluyong City. Speakers include the Cold Chain Association of the Philippines’ Anthony Dizon and REID Foundation’s Ronilo Balbieran. Registration and sponsorship is now open; visit scmap.org for more information.

 

Henrik Batallones is the marketing and communications executive of SCMAP. A former board director, he is also editor-in-chief of the organization’s official publication, Supply Chain Philippines. More information about SCMAP is available at scmap.org.

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