Cold Chain Infrastructure
Cold Chain Infrastructure
Business Model Description
Build cost-effective cold warehousing facilities with high infrastructure connectivity, such as the ones established adjacent to the seaport and the international airport, for storage of processed frozen food, including fish and other seafood products, that will be either exported, re-exported, or are imported for use in the domestic market.
Expected Impact
Provide controlled supply chains that address post-harvest losses and food insecurity, and enhance export and import activities.
How is this information gathered?
Investment opportunities with potential to contribute to sustainable development are based on country-level SDG Investor Maps.
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Country & Regions
- Mauritius: Countrywide
- Mauritius: Port Louis
Sector Classification
Food and Beverage
Development need
Mauritius' agro-industry mainly relies on sugarcane and tuna production (11, 3). Regarding climate change threats on food security and SDG 2, as well as environmental degradation, diversifying the agricultural production is key (6, 11). Thus, whole agro-industry value-chain should be re-envisioned through the promotion of sustainable, local production and consumption (11, 12).
Policy priority
Through its Strategic Plan 2016-2020, the Ministry of Agro Industry and Food Security aims to redirect the agricultural and agro-industry towards an efficient and profitable sector and rendering it more sustainable (3). The Government Programme 2020-2024 supports a cane industry reform, encouraging the shift to modern harvesting practices (6).
Gender inequalities and marginalization issues
Overall, 50% of agricultural production is estimated to come from the corporate sector (12), when small-scale, family exploitations constitute the majority of farmers. Yet, they only represent 17% of the total agricultural land while 83% of the lands are exploited by big companies, which are often active in the cane industry (11).
Investment opportunities introduction
Several markets offer untapped export potential, such as China, Indonesia, Japan, Brazil or the Philippines, including for agricultural and agro-processed products (9). The tourism industry also presents some local untapped potential, especially for agro-processed food (12).
Key bottlenecks introduction
There is a lack of norms and enforcement in the agricultural sector, inadequate investment in research and lack of preparedness to face climate change impacts (12). Mauritius has a strong dominance of the sugarcane industry in the sector, increasing competition for land to produce other crops and a lack of appropriate storage facilities (e.g. cold storage) (11, 12).
Food and Agriculture
Development need
Developing sustainable agriculture and fishing practices is key to address import-dependency, price fluctuations, pressure on stocks and enhance small scale farmers' resilience (12). Considering the sector's GHG emissions and the high pesticides residues on soils and locally produced agricultural products, sustainability and innovation principles are needed in the sector (11).
Policy priority
The 2019 Voluntary National Review and Strategic Plan 2016-2020 include improving national food security through sustainable agriculture, bio-farming practices, sustainable fisheries and aquaculture (12, 32). The Government Programme 2020-2024 and the Ministry of Blue Economy's mission statement entail the industrialization of fisheries to render Mauritius a seafood hub (4, 5).
Gender inequalities and marginalization issues
In 2018, the gender pay gap in the primary industry, which includes agriculture and fisheries sector, was 43% in Mauritius (7). The female employment rate in the fisheries industry was 4%, while the female employment rate in the aquaculture sector was 18% (3).
Investment opportunities introduction
In 2019, the export of fish and fish products generated USD 342.6 million, contributing 19% of Mauritius exports and the fish sector reached USD 810 million turnover in 2018 (4, 32). 3.4% of GDP was contributed by the agricultural sector in 2013, and the sector is promoted by various incentives and schemes (12, 32).
Key bottlenecks introduction
As an island, agricultural space is limited and agricultural development may interfere with other land use options (53). High cost of labor and agricultural inputs, unfavourable agronomic conditions, aging farming community and unfavourable environment for aquaculture development are decreasing Mauritius' competitiveness compared to neighboring islands (12).
Agricultural Products
Pipeline Opportunity
Cold Chain Infrastructure
Build cost-effective cold warehousing facilities with high infrastructure connectivity, such as the ones established adjacent to the seaport and the international airport, for storage of processed frozen food, including fish and other seafood products, that will be either exported, re-exported, or are imported for use in the domestic market.
Business Case
Market Size and Environment
92,526 tons of seafood imported and 30,323 tons exported in 2020
In 2020, Mauritius imported 95,526 tons of frozen seafoods (fish and crustaceans, mollusks and other products) and exported 30,323 tons of seafood. The country's total domestic utilization was of 93,177 tons (42).
With the ratification of the African Continental Free Trade Area (AfCFTA), a boost in intracontinental exports by 81% and exports with non-African countries by 19% are expected by 2035, some of which requires cold chain storage (19).
In 2020, the total production of fresh fruits and vegetables in Mauritius was over 90,000 tons, which also require cold chain storage (20).
Indicative Return
> 25%
Froid des Mascareignes (FDM), a cold storage company, and Bella Amigo, providing refrigerated transport solutions, achieved gross profit margins of 45.8% and 29.3%, respectively (21, 22).
Investment Timeframe
Medium Term (5–10 years)
The Development Bank of Mauritius (DBM) offers a special loan for construction of warehousing facilities, among other agro industry businesses, with a moratorium period of one year and repayment period of seven years, implying medium term investment timeframe for cold chain infrastructure (60).
Ticket Size
USD 1 million - USD 10 million
Market Risks & Scale Obstacles
High Energy Requirement
Market - Highly Regulated
Business - Supply Chain Constraints
Impact Case
Sustainable Development Need
In Sub-Saharan Africa, 40% of food perishes before reaching costumers (30). Due to Mauritius' low warehouse capacity, postharvest losses are high, the quality of harvested commodities is deteriorating, posing dangers to the agro-processing business, local and global supply chain (31).
Mauritius is vulnerable to climate change impacts, extreme weather conditions, external shocks and global crisis, which makes food storage solutions vital to prevent supply chain interruptions (32, 33).
In Mauritius, food and fish export activities are constrained due to insufficient cold storage facilities, which undermine the export competitiveness of the country and make it unable to leverage global export opportunities (34, 29).
Gender & Marginalisation
In Mauritius, gender wage gap in the agriculture and fisheries sectors is 49%, most women are engaged in small-scale fish processing and trading. Women without access to storage facilities are the most vulnerable ones in the sector because of the input waste in fish handling and processing (58).
Improving nutrition and food habits through increased local production is critical for women's health in Mauritius, where the prevalence of obesity is projected at 17.8% among adult females compared to 6.5% among adult males (59).
As post-harvest fruit and vegetable losses are estimated at 25-30% in Mauritius due to reasons such as microbial infections and improper handling and storage processes, there is a demonstrable need to invest in proper post-harvest processes to protect the income of farming communities (61).
Expected Development Outcome
As a post-harvest operation, cold chain infrastructure can reduce food perish and post-harvest losses, which are critical for improving food security, increasing income, and lowering the economic and environmental burden (38).
Cold chain infrastructure ensures sustainability and resilience of the supply chain for local and international networks by extending the shelf life of products and minimizing spoiling risks in case of supply interruptions during the global crisis and extreme weather conditions (56).
Cold chain infrastructure enhances export competitiveness of Mauritius by leveraging export opportunities, which prevent the spoiling of foods and fish between cultivation and marketing while increasing food safety (56, 34).
Gender & Marginalisation
Investments in cold chain infrastructure create job opportunities for women in the cold supply chain, provide reliable access of foods and fishes for women traders and processors as well as ensure steady income for women vendors by diminishing postharvest loss (39, 57).
Increasing women’s access to cold storage facilities improves their business profitability and food safety while reducing post-harvest losses in fish handling and processing (58).
Primary SDGs addressed
2.1.1 Prevalence of undernourishment
2.1.2 Prevalence of moderate or severe food insecurity in the population, based on the Food Insecurity Experience Scale (FIES)
2.4.1 Proportion of agricultural area under productive and sustainable agriculture
Food consumption of 6.2% of Mauritius' population's was insufficient in 2019 (40).
20.5% of the adult population in Mauritius suffered from moderate or severe food insecurity in 2018 (41).
7,352 hectares of food crops area was harvested in 2020 in Mauritius, representing 17% of total harvested area (42).
N/A
N/A
In 2015, Mauritius Agricultural Certification Body under aegis of the Ministry of Agro Industry and Food Security has been set up to monitor the agricultural area under sustainable practices. Data is not available as of 2020 (32).
14.4.1 Proportion of fish stocks within biologically sustainable levels
As a proxy indicator, Mauritius' ratio of artisan fish catch to maximum sustainable yield (of 1,700 tons) was 35.7% in 2020 (40).
N/A
Secondary SDGs addressed
Directly impacted stakeholders
People
Planet
Corporates
Public sector
Indirectly impacted stakeholders
Gender inequality and/or marginalization
Planet
Corporates
Public sector
Outcome Risks
Cold chain infrastructure are resource intensive in construction and maintenance, which may negatively impact the environment (26).
Ammonia systems, while saving up to 40% energy, are not carbon free and contribute to depleting ozone layers (43). Refrigerators carry hazardous materials and require end-of-life recycling.
Coolant systems in the cold chain infrastructure contain combustible gas, such as ammonia, which may cause fire and explosion (44).
Employees operating in cold chain infrastructure are exposed to cold temperatures and other risks, which may damage their health (45).
Impact Risks
Lack of technical skills in handling refrigeration equipment in cold rooms and storage may result in limited delivery of services, hence lessen the positive impact (29).
Establishment and maintenance of cold room infrastructure may not be delivered according to environmental standards such as use of low global warming potential (GWP) refrigerants, limiting the expected impact.
Impact Classification
What
Cold chain infrastructure provides controlled supply chains that address post-harvest losses and food insecurity, and enhances export and import activities.
Risk
A lack of locally trained personnel and disregard for environmental concerns, such as use of low global warming potential (GWP) refrigerants, may limit the scale of impact for cold chain infrastructure.
Contribution
Cold storage infrastructure advances Mauritian food and fish processing industry, enhancing food security and sectoral capacity, in addition to sustainable sourcing and production.
Impact Thesis
Provide controlled supply chains that address post-harvest losses and food insecurity, and enhance export and import activities.
Enabling Environment
Policy Environment
Industrial Policy and Strategic Plan for Mauritius, 2020-2025: Supports the continued growth of Mauritius’ industrial capabilities, and envisions strategic objectives for eight sectors to be strengthened, including for fish processing export (29).
Ministry of Health and Quality of Life, Guidelines, 2006: Sets up guidelines for Cold Room and Refrigeration Plant 0 - 46,45 m2; 46,46 - 92,90 m2; above 92,90 m2 (for storage and hire only) (46).
Strategic Plan For the Food Crop, Livestock and Forestry Sectors, 2016 - 2020: Aims to improve food security and promote sustainable agriculture. Reducing import dependency and encouraging engagement in agri-business are also targeted (12).
Ocean Economy in Mauritius, 2017: World Bank document that summarizes individual government policies to increase Blue Economy's share in GDP and initiatives such as Seafood Hub that includes investments in longline vessels, cold storage, and fish processing (1).
Financial Environment
Financial incentives: A subsidy of 50% of the cost of purchasing and installing solar-powered cool rooms will be offered to registered planters farming on a minimum of one hectare of land, up to a maximum of Rs 400,000 (50).
Fiscal incentives: Companies engaged in storage and distribution of dry and cold products, storage, packaging and distribution of fruits and vegetables, and promotion and distribution of food products are eligible for low taxation of 3% as well as VAT and customs duty exemptions (51).
Other incentives: Mauritius Freeport is a duty free marketing and logistics hub (52). All goods imported into Freeport are duty and VAT exempt, and corporate tax is 3% for the companies operating in the zone (54).
Regulatory Environment
Food Regulations, 1999: Regulates the control of food safety and hygiene, including frozen foods and cold storage hygienic standards (47).
Free Port Act: Enables third-party freeport operators to provide storage space to businesses outside the freeport zone and extend warehousing period from 24 to 36 months in the freeport zone (48).
Employment Relations Act, 2019: Sets uniform rules for cold room workers and states that an employer cannot make an employee spend more than 30 minutes in a cold room (49).
Marketplace Participants
Private Sector
Froid des Mascareignes (FDM), Bella Amigo Co Ltd, National Cold Storage (Hemraj Ghina & Sons Ltd.), Agricultural Marketing Board (AMB) Airport Cold Storage.
Government
Ministry of Agro Industry and Food Security, Ministry of Health and Wellness, Economic Development Board (EDB) Mauritius Freeport Authority, Agricultural Marketing Board, Mauritius Freeport Development Co.
Multilaterals
United Nations Food and Agricultural Organization (FAO), United Nations Development Programme (UNDP), European Union (EU).
Non-Profit
Mauritius Chamber of Agriculture, Sustainable Tuna Association.
Target Locations
Mauritius: Countrywide
Mauritius: Port Louis
References
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