The Global Commercial Refrigeration Equipment Market was valued at USD 35.12 Billion in 2022 and is projected to reach USD 53.07 Billion by 2030, registering a CAGR of 5.27% for the forecast period 2023-2030.
Market Definition
The process of eliminating extra heat from a material or source to keep the temperature below that of its surroundings is known as commercial refrigeration. Commercial refrigeration equipment prolongs the shelf life of food items by maintaining a particular temperature, which is useful for preserving fruits, vegetables, meat, and other comparable products. Shortly, a significant portion of the refrigerator market is anticipated to be accounted for by the replacement of outdated equipment with sustainable and energy-efficient equipment. A common feature of refrigeration equipment is its ability to quickly drop food temperatures from 90°C to as low as 30°C to prevent the growth of bacteria. Throughout the commercial refrigeration market forecast period, it is projected that the demand for packaged food will rise globally at a moderate rate. Shortly, this is anticipated to raise market demand for commercial refrigeration. Additionally, during the analysis period, it is anticipated that the demand for commercial refrigeration will increase due to the rise in food safety regulations.
Market Size:
- 2022: USD 35.12 Billion
- 2030: USD 53.07 Billion
- CAGR (2023-2030): 5.27%
Commercial Refrigeration Equipment Market Dynamics
Drivers Propelling the Demand for Commercial Refrigeration Equipment include:
Global demand for processed and frozen foods is rising:
To produce, process, and distribute food to billions of households worldwide, the food processing industry needs tools and solutions that support a complex value chain that spans from farming to logistics. With the growing global population and changing dietary preferences that reflect increased incomes and a move toward value-added products, this industry has grown in significance. The shifting dietary habits of the urban population are driving up demand for both fresh and processed fruits and vegetables worldwide. The demand for both fresh and processed fruits and vegetables has increased as a result of rising disposable incomes in emerging economies. Around the world, frozen food items are progressively becoming a staple of everyday meals, Additionally, growing living standards and fast urbanization in developing nations are driving up demand for packaged and processed foods, which in turn is driving up sales of commercial refrigeration equipment. Throughout the forecast period, this is expected to drive the commercial refrigeration equipment market, due to this factor fueling the growth of the Commercial Refrigeration Equipment market.
For instance, in August 2023, according to the International Institute of Refrigeration, According to Frozen Food Europe, the global frozen food market was estimated at USD 392.4 billion in 2022 and is projected to reach USD 612.3 billion by 2032, growing at a compound annual growth rate (CAGR) of 4.6% between 2023 and 2032. In 2022, Europe dominated the global frozen food market, with a market share of around 37%.
consumption of essential food fuel to Continue Driving Market Growth:
To store and preserve perishable foods like fruits, vegetables, dairy products, and meat, there is an increasing demand for refrigeration equipment that is dependable and efficient. This increases the need for different kinds of walk-in coolers, freezers, and display cases in grocery stores, eateries, convenience stores, and other food service businesses. Advanced refrigeration technology is required due to shifting consumer preferences for fresh, healthful, and organic foods. This includes devices that minimize food waste, increase shelf life, and maintain ideal humidity and temperature levels. For instance, there is a growing need for specialized equipment meant for the preservation of fruits, vegetables, and substitute protein sources due to the popularity of plant-based and vegan diets, Strong refrigeration infrastructure is becoming more and more necessary as grocery delivery services, convenience stores, and supermarket chains expand. To maintain food quality throughout the supply chain, this expansion calls for investments in sizable cold storage facilities, refrigerated vehicles, and point-of-sale equipment. There is a growing need for refrigeration equipment that meets stringent temperature control requirements and reduces the possibility of contamination due to increased awareness of food safety laws and hygiene practices. This includes technological advancements like automated cleaning systems, antimicrobial surfaces, and real-time temperature monitoring. this factor driving the growth of the Commercial Refrigeration Equipment market.
For instance, in July 2022, according to the International Food Information Council, 2022, 52% of Americans report that they followed a diet or eating pattern in the past year, a significant increase from the past few years (39% in 2021, 43% in 2020, 38% in 2019), one that is not driven by the two new options this year, mindful eating and intuitive eating. The increased dieting has come primarily from consumers under age 50.
Recent Developments
In May 2021, The release of the new Optyma condensing units and MTZ/NTZ compressors following the qualification of valves and line components in 2020 means Danfoss has the widest portfolio of A2L-ready refrigeration solutions compatible with R1234yf, R454C, and R455A refrigerants.
In September 2022, hermo King, a leader in transport temperature control solutions and a brand of Trane Technologies, unveiled today and will feature at the IAA Transportation 2022 show in Hannover, Germany, three breakthrough models of the Advancer trailer refrigeration solutions, the multi-temperature Advancer Spectrum, the Advancer Axle Power energy recovery system, and the electric, engineless Advancer-e.
Restraint
High Maintenance and Capital Expenditure Costs to Hinder Adoption in All Industries Impedes Market Growth:
Commercial refrigeration systems are used in high-load applications, and because of this, they are subject to stricter regulations. Commercial-grade refrigerants are used in refrigeration systems, and they are produced in compliance with government regulations to reduce greenhouse gas emissions and carbon emissions. Additionally, because commercial refrigerators and freezers are designed to fit in large spaces, the price of the equipment varies depending on size and application. This is because the equipment is used in commercial settings. As a result, purchasing pricey refrigeration systems requires a large initial outlay, and maintaining such massive machinery becomes a barrier to system adoption across numerous industries. However, another significant factor impeding the adoption of advanced refrigeration machines and energy-efficient systems among customers is their lack of awareness of these products, Large-scale refrigeration system maintenance frequently calls for specific technical know-how, which increases operational complexity and may call for additional staff training or outside services. This could drive up expenses even more and put smaller companies or those with fewer resources at a disadvantage. Inventory, revenue, and customer satisfaction can all suffer significantly when there is downtime brought on by equipment failure or maintenance. Purchasing complicated refrigeration systems is further discouraged by this risk, especially for perishable food vendors. Conventional commercial refrigeration equipment can use a lot of energy, which raises electricity costs and increases carbon emissions. Businesses that care about the environment may find this concerning, and carbon taxes or other regulations may result in additional expenses. Concerns about the environment and regulations are increased by the requirement for proper disposal of refrigerants at the end of the equipment life cycle. this factor hinders the growth of the Commercial Refrigeration Equipment market.
For instance, in November 2023, despite headwinds, fleet maintenance operations continued to offset increases, Decisiv reports. The service relationship management provider also announced digital inspection integrations with Cummins-Meritor and Phillips Industries.
Challenges
Few companies provide purification services.
Different grades of CO2 and ammonia are suitable for use in commercial refrigeration equipment as refrigerants. The purity of these grades must be extremely high. Ammonia of refrigerant grade has an oil content of 2 parts per million (ppm) and a water content of 33 ppm, making it 99.95% pure. Maintaining ammonia purity is crucial for the correct operation of refrigeration systems. Natural refrigerants are expensive to purify, and the procedure is labor-intensive. As a result, the number of businesses that make ammonia suitable for refrigerants is small. Likewise, a water content of less than 10 parts per million is required for refrigerant-grade CO2. That being said, not many businesses offer this grade of CO2. Therefore, the market for commercial refrigeration equipment is facing growth challenges due to the existence of a small number of purification companies.
Opportunities
Improvements in the efficiency of refrigeration systems with the use of natural refrigerants
The goal of many government organizations and research and development firms is to increase the commercial refrigeration systems' lifetime, total ownership cost, efficiency, and coefficient of performance. Manufacturers are working to create natural refrigerant technologies that can increase the energy efficiency of commercial refrigeration systems in light of the Kyoto Protocol and the most recent EU F-Gas regulations. Ammonia and CO2 refrigerant technologies are being introduced by companies like Carnot Refrigeration, Danfoss, and Carrier Commercial Refrigeration. In the past, only a few refrigeration applications could use cascade refrigeration systems that used ammonia and CO2 as refrigerants. However, cascade refrigeration systems are the preferred option for a variety of refrigeration applications due to the growing awareness of environmentally friendly refrigerants. The Kyoto Protocol's article 12 defines the Clean Development Mechanism (CDM), which promotes the use of natural refrigerants. A nation that has committed to reducing its emissions under the Kyoto Protocol may carry out an emission-reduction project with the help of the CDM. These initiatives have the potential to produce marketable Certified Emission Reduction (CER) credits, which are worth one ton of CO2 and can be applied toward reaching the Kyoto targets. The installation of energy-efficient machinery in industries is one of these projects.
Snapshot:
| Attributes | Details |
| Market Size in 2022 | USD 35.12 Billion |
| Market Forecast in 2030 | USD 53.07 Billion |
| Compound Annual Growth Rate (CAGR) | 5.27 % |
| Unit | Revenue (USD Million) and Volume (Kilo Tons) |
| Segmentation | By Product, By Refrigerant Type, By Application & By Region |
| By Product |
|
| By Refrigerant Type |
|
| By Application |
|
| By Region |
|
| Base Year | 2022 |
| Historical Year | 2018 - 2022 |
| Forecast Year | 2023 - 2030 |
Segment Analysis of the Commercial Refrigeration Equipment Market
The Commercial Refrigeration Equipment Market is segmented by product, refrigerant type, application, and region.
By Product
The transportation refrigeration segment held the largest market share in 2022:
Product is sub-segmented into refrigerator and freezer, transportation refrigeration, refrigerated display cases, beverage refrigeration, ice cream merchandiser, and refrigerated vending machine. The transportation refrigeration segment accounted for the highest market share in the global Commercial Refrigeration Equipment market for 2022. The cold chain, a temperature-controlled distribution system for perishable commodities like food, medications, and chemicals, depends heavily on transportation refrigeration equipment. It is essential to maintain the right temperature during transportation to protect product safety and quality while reducing spoiling. Transportation refrigeration is essential to many industries, including food and beverage, pharmaceutical, agricultural, and healthcare. The equipment covered by the transportation refrigeration market is diverse and includes refrigerated trucks, trailers, containers, and specialty units for particular products like live seafood or vaccines. Its wide market share is a result of its diversity, which meets industry demands and a range of transportation needs. Innovations such as fuel-efficient technologies, remote monitoring systems, multi-temperature compartments, and alternative refrigerants are driving continuous industry evolution.
On the other hand, the refrigerators and freezers segment has a significant market share over the forecast period, due to This is explained by the travel and tourism sector's global expansion, which has resulted in the opening of numerous eateries and fast-food chains. The segment also discusses blast chillers, which are primarily used to stop bacteria growth in stored items and quickly freeze or cool items at lower temperatures. In addition, a major factor in the market expansion is the widespread use of chillers by medical professionals to store vital medications, controlled tests, and vaccine tissue samples.
By Refrigerant Type
The Fluorocarbons segment was the leading segment in 2022:
By Refrigerant Type, which is divided into fluorocarbons, hydrocarbon, and inorganic. The fluorocarbons segment accounted for the largest share of the global Commercial Refrigeration Equipment market in 2022. Hydrochlorofluorocarbons (HCFCs) and hydrofluorocarbons (HFCs) are two types of hydrocarbons that have been used in refrigeration for many years. They have a proven track record of efficiency, dependability, and temperature stability. Their track record of success fosters confidence and establishes them as a reliable option for numerous enterprises. Fluorocarbons meet a range of requirements in different commercial refrigeration applications. They are used in walk-in coolers, freezers, refrigerators, ice makers, display cases, and other appliances, providing flexibility and adaptability for various food kinds and storage needs. Fluorocarbons are generally more readily available and less expensive than some of the more recent alternative refrigerants. This makes them a desirable choice for companies on a tight budget, especially those in developing nations or smaller enterprises.
The hydrocarbon segment is anticipated to register rapid growth in the forecast period, since hydrocarbons have no Ozone Depleting Potential (ODP) and a low Global Warming Potential (GWP), they are a sustainable substitute for conventional fluorocarbons like HFCs. This is consistent with increased environmental awareness and more stringent laws regarding dangerous refrigerants. When compared to older fluorocarbon refrigerants, certain hydrocarbon refrigerants have better energy efficiency, which lowers operating costs and leaves a smaller carbon imprint.
Regional Analysis
Asia Pacific occupied the largest market share in 2022:
Asia Pacific has the largest revenue market share 46% in 2022, as a result of rising frozen food product demand in South Korea, Japan, China, India, and China. To support market expansion, food manufacturing companies throughout the region are concentrating on creating frozen versions of locally produced foods. The Organic Trade Association (OTA) predicts that of all the food sectors, the global organic food industry will grow at the fastest rate. Customers are more likely to choose nutrient-dense, organic food items, which increases reliance on the cold chain procedure and associated machinery. Throughout the forecast period, it is anticipated that the growing number of supermarkets and hypermarkets will increase the Asia Pacific market share. Growing urbanization and increased potential income in China have resulted in increased shopping and availability of fresh, organic, and hygienic produce. Higher-quality food has increased demand for commercial refrigeration systems across a range of industries, and these refrigerators offer greater freshness and hygiene. China has a lot of market opportunities to trade commercial refrigeration equipment internationally because there are many local manufacturers available for commercial applications.
On the other hand, North America accounted for a significant share over the forecast period, The growth of the regional market will be propelled by rising investments in North America's food and beverage sectors. The key elements enhancing the development potential of the North American market are the players' significant investments in R&D, as well as their participation in strategic alliances, acquisitions, collaborations, and joint ventures. The population's growing disposable income and busy lifestyles also lead to increased spending on frozen and ready-to-eat foods, which in turn fuels the demand for commercial refrigerators and propels the market's growth in North America.
Competition Analysis
- AHT Cooling Systems GmbH
- Ali Group S.r.l. a Socio Unico
- Carrier
- Dover Corporation
- DAIKIN Industries, Ltd.
- Carrier
- Electrolux AB
- Hussmann Corporation
- Illinois Tool Works Inc.
- Johnson Control
- Lennox International Inc.
- Panasonic Corporation
- Whirlpool Corporation
Segmentation Analysis of the Commercial Refrigeration Equipment Market
By Product
- Refrigerator & Freezer
- Transportation Refrigeration
- Refrigerated Display Cases
- Beverage Refrigeration
- Ice Cream Merchandizer
- Refrigerated Vending Machine
- Fluorocarbons
- Hydrocarbons
- Inorganic
- Hotels & Restaurants
- Supermarkets & Hypermarkets
- Convenience Stores
- Bakeries
- North America
- Europe
- Asia Pacific
- Latin America
- Middle East and Africa
Impact of the COVID-19 Pandemic on the Commercial Refrigeration Equipment Market:
Stockpiling and shifting consumer habits led to an increase in demand for certain industries, including supermarkets, food delivery services, and grocery stores. As a result, there was a brief spike in demand for food preservation and storage equipment. Increased awareness of hygienic and sanitation practices led to a rise in the use of refrigerated transportation and storage facilities for food and medical supplies, which could be advantageous for particular market segments. There is a greater need for cold chain infrastructure, such as refrigerated trucks and warehouse refrigeration systems, as a result of the growth in online grocery delivery services. Lockdowns and other restrictions caused shortages, price swings, and production delays by upsetting the global supply chain for equipment and raw materials. This affected new equipment installations and deliveries. The economic slowdown brought on by the pandemic affected investments in several industries, including the restaurant and hospitality sectors. In certain markets, this had an impact on the demand for new refrigeration equipment. Some businesses may have prioritized cost-effectiveness in response to economic pressures, which may have resulted in the use of equipment that is either lower quality or less efficient in certain applications
