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Swire Cold Chain Logistics Opens New Facility in Shanghai

Guests of honour at the opening ceremony (left to right): Directors of John Swire & Sons (H.K.)Limited, Sam Swire and Ian Shiu, Swire Pacific's Executive Director, Trading & Industrial Division,J B Rae-Smith, Swire Pacific Chairman John Slosar, Jiang Hongxia, Deputy Director of theShanghai Municipal Commission of Commerce, Clement Lam, Managing Director of Swire PacificCold Storage Limited and Swire Cold Chain Logistics (Shanghai) Company Limited, Xu Jianlong,Director of the Fengxian District Economic Commission and Cao Guibin, Deputy Director of theFengxian District Development Zone.

Swire Cold Chain Logistics (Shanghai) Company Limited, a wholly owned subsidiary of Swire Pacific Cold Storage Limited ("Swire Pacific Cold Storage"), opened its new cold storage facility at Fengxian in Shanghai today. John Slosar, Chairman of Swire Pacific Limited and J B Rae-Smith, Swire Pacific's Executive Director, Trading & Industrial Division, officiated at the opening ceremony, with Jiang Hongxia, Deputy Director of Shanghai Municipal Commission of Commerce, Cao Guibin, Deputy Director of Development Zone of Fengxian District and Xu Jianlong, Director of Economic Commission of Fengxian District as guests of honour.

The new facility is Swire Pacific Cold Storage's first wholly owned cold storage facility in Mainland China, marking the company's expansion into the country's fast growing cold chain logistics industry. Driven by the increasing affluence of the middle classes, who have a growing appetite for quality frozen packaged foodstuffs, China is seeing a burgeoning demand for cold chain services, with fixed asset investment in cold storage reaching more than RMB 100 billion in 2013 - representing a year-on-year increase of 24.2%1. The growing awareness of food safety issues has also highlighted the importance of modernising the country's food supply chain.

The tremendous growth potential for the industry is underlined by the fact that China's per capita capacity is only one third of that in the United States2 and third party logistics development has been prioritised in the Central Government's 12th five-year plan. Swire aims to make a significant contribution by building and operating best-in-class cold storage facilities that will set a benchmark for the industry, and it will benefit greatly from the strong government support for the logistics sector.

Swire is no stranger to the cold storage business. The group has nearly 60 years of experience in operating best-in-class cold storage facilities in Australia, the USA, Vietnam and Sri Lanka, and Swire ranks as number three in terms of capacity on the International Association of Refrigerated Warehouses' Global Top 25 list. The group entered the Mainland China cold storage market in 2008, in partnership with Guangdong Foodstuffs Import and Export (Group) Corporation, and the joint venture operates a 227,000 cubic-metre facility at Huangpu in Guangzhou.

Located in the Shanghai Seaport Comprehensive Economic Development Zone in Fengxian District, the new facility is 60 km from the centre of Shanghai and 15 km from Yangshan Port Free Trade Zone and is strategically located to service the Shanghai municipality, as well as the major cities in Jiangsu and Zhejiang Provinces. At an investment of RMB 440 million, the new facility is one of the largest and most advanced of its kind in Eastern China, spanning over 43,420 square metres and providing 50,000 pallet positions, totalling 354,000 cubic metres of temperature-controlled space. The warehouse is divided into seven zones, with full temperature control ranging from -25 to 15 degrees Celsius.

The facility incorporates world-class warehouse design and management technology, offering integrated cold chain services, and encompassing multi-temperature refrigerated storage, warehouse and inventory management services, and transport and distribution solutions through partner resources to meet customers' varying requirements. The sophisticated warehouse management system includes RF barcode scanning technology that increases efficiency and accuracy and enables customers to access inventory data and track orders in real-time around the clock. The facility has recently gained LEED Platinum accreditation, the green building certification programme's highest rating, with features designed to lessen environmental impact that include a rainwater recycling system, LED lighting and a geo-thermal heat exchange system.

J B Rae-Smith, Swire Pacific's Executive Director, Trading & Industrial Division, said: "The opening today is a significant milestone. This new facility represents an important investment by Swire as we expand our presence in the cold storage sector on the Mainland. It will showcase to the Mainland market our strengths in building and operating modern cold storage infrastructure that adheres to leading international standards of food hygiene and environmental best practice. With Swire's proven track record in operating industry-leading facilities in different parts of the world and offering integrated logistics solutions to our customers, we are confident that Swire Pacific Cold Storage will make a significant contribution to Mainland China's frozen food industry."

"Swire takes a long-term view in developing our businesses and cold storage is no exception. Our plan is to build a nationwide cold chain logistics network comprising a total of 13 large-scale cold storage facilities by 2020. These facilities will be supported by a comprehensive range of distribution and logistics services, providing our food industry customers with efficient, cost-effective solutions, so that they can focus on enhancing their product and service quality," added Mr. Rae-Smith.

In addition to the Shanghai facility, Swire Pacific Cold Storage's new facility at Langfang in Hebei Province has also commenced operations. Two more cold storage facilities are under construction at Nanjing in Jiangsu Province and Ningbo in Zhejiang Province and one facility is under planning in Chengdu in Sichuan Province. These facilities are scheduled to commence operations from 2015 to 2016. More cold stores are in the pipeline for major regional clusters, and will ultimately serve up to two-thirds of the national population.

September 23, 2014

Tagged:

Cao Guibin
Deputy Director
Mainland China
Trading Industrial Division