J&K’s cold storage industry holds both promise and challenges

ZIRAAT TIMES EDITORIAL BOARD 

The cold storage industry in Jammu & Kashmir has emerged  as a vital element of the former state’s crucial horticulture and agriculture sectors. The newly-developed network of cold storages have played a great role in value addition in the agriculture economy of J&K, including job creation. These large storage facilities have also enabled farmers and traders to expand market reach, adding significant value to their produce. Amidst a competitive environment and evolving market needs, the Jammu & Kashmir Fruits and Vegetables Processing and Integrated Cold Chain Association (JKPICCA) has a crucial role in shaping policies that address the pressing challenges facing this industry. Chief among these is the growing mismatch between cold storage supply and actual demand, a problem that could undermine the sector’s sustainability if left unaddressed.

Cold storage facilities are now  integral to J&K’s horticultural economy, particularly for apple and other high-value crops. They provide the means to avoid distress sales by allowing products to be stored until prices improve, which is essential in times of market glut. In a state  where horticulture accounts for a substantial share of rural incomes, cold storage is indispensable for economic stability and value addition. Beyond merely preserving produce, cold storages have  contributed to the state’s long-term economic wellbeing in the agriculture sector by supporting  seasonal planning and reducing post-harvest losses. However, achieving sustainable growth and maximum benefit from cold storages requires careful policy interventions to prevent an oversupply in capacity and ensure each facility operates at viable occupancy rates.

A recent Niti Aayog report indicated that Jammu & Kashmir would require around 5 lakh metric tons of cold storage capacity by 2030. Yet, with 85 operational units and 70 more expected, the region is set to surpass this requirement, leading to approximately 25-30% of cold storage capacity remaining vacant this year alone. The economic consequences of this discrepancy are significant. Underutilized cold storages incur fixed costs without generating corresponding revenue, which could strain operators and could ultimately deter further investment. Consequently, the newly elected JKPICCA leadership must address this issue strategically to protect the industry’s economic health and growth potential.

Establishing a balanced regulatory framework that encourages demand-responsive cold storage capacity is vital. J&K’s new policymakers should avoid reverting to a “license raj” system but instead create a rational regulatory framework based on evidence and demand forecasts.

Moreover, JKPICCA and the government could explore demand-creation strategies to optimize existing capacities. Investment in technology-driven logistics solutions is another area to consider.

While JKPICCA’s new leadership has its task cut out in addressing the current oversupply of cold storage facilities, the sector’s long-term growth will rely on collaborative, balanced policymaking that supports both farmers and operators. The hard work and the strategic work done by the outgoing leadership would be an important baseline to buikd on. By maintaining an ideal supply-demand equilibrium and ensuring efficient, effective utilization, J&K’s cold storage industry can continue to promote  the state’s horticultural and agricultural sectors and serve as a model of sustainable, value-driven agriculture here.