Five Canadian-based companies are among the world’s top 25 largest temperature-controlled warehousing and logistics providers, according to the most recent rankings from the International Association of Refrigerated Warehouses. Leading the Canadian contingent is VersaCold Logistics Services, headquartered in Vaughan, Ontario. VersaCold placed eighth on the global list, compiled March 22, with a capacity of 2,988,302 cubic metres. The other Canadian companies on the list were Conestoga Cold Storage of Dorval, Quebec, at 13th with 1,821,613 cubic metres capacity; Congebec Logistics Inc. of Boucherville, Quebec, at 14th with 1,723,556 cubic metres; Confederation Freezers of Brampton, Ontario, at 20th with 976,789 cubic metres; and Trenton Cold Storage of Trenton, Ontario, at 21st with 970,626 cubic metres.
CRITICAL TO GLOBAL COLD CHAIN
That five Canadian-based companies made the global list “shows how critical Canada is to the global food chain, in that such high capacity is needed to support domestic and international consumption,” VersaCold’s Director of Marketing, Brian Dove, said by email. Mr. Dove added that it also demonstrates “healthy mix of competition within the domestic industry” and reflects “a long-term commitment by the people behind these operations.”
Dr. Barry Prentice, a professor of supply chain management at the University of Manitoba, said he wasn’t aware that Canadian companies had such an outsized presence in the global refrigerated warehousing realm but he wasn’t surprised.
“Oftentimes, where things start, they tend to stay,” Dr. Prentice said. “We probably got an early start on the technology. And we’ve just still pursued it.”
He also noted that Canadian companies are large producers of red meat, cheese and other products that need longer-term storage. “Therefore, you need the cold storage to smooth out the production,” he said. “So it probably has a lot to do with just the size of the country and our agricultural foundation.” Dr. Prentice said he also read recently about a shortage of warehousing space in locales such as Vancouver. “I’m wondering whether part of that is companies that are starting to move away from the just-in-time approach and have a little more buffer stocks because of the uncertainty of when things might arrive,” he said.
VERSACOLD SOLD
Shortly after the latest global list was released, Lineage Logistics LLC — which tops the list with capacity of 73,498,895 cubic metres — announced it had “signed a definitive agreement” to acquire VersaCold from TorQuest Partners, the Investment Management Corporation of Ontario, and OPTrust. Until the deal closes, which is expected to happen in the third quarter of 2022, VersaCold and Linear will remain separate companies, Mr. Dove said. “So in the short term, it’s business as usual. Long term, this presents an opportunity for our customers to be integrated into a global network of temperature- sensitive, food-focused logistics services. Our customers’ supply chains reach around the world and now so will their logistics partner.”
VersaCold now has 24 temperature-controlled facilities with 114 million cubic feet of storage and 361,000 pallet positions. (That’s slightly more storage than the 105.5 million cubic feet in the most recent IARW tally.) In addition to its warehouses, VersaCold has about 1,300 employees, 204 trailers, 188 trucks, and nine transportation terminals to serve about 1,500 customers in nine provinces.
VersaCold began in 1946 as B.C. Ice & Cold Storage Co., which served the fishing industry in Vancouver, according to the company website. The company grew over the years and by 2005 had a global presence following its purchase of P&O Cold Storage, which added operations in the U.S., Australia, Argentina, and New Zealand. In 2010, VersaCold sold its offshore operations to Americold, which is now #2 on the global list with a capacity of 39,962,999 cubic metres. That sale included 54 facilities in the U.S., nine each in Australia, and New Zealand, as well as two in Argentina, said VersaCold news release at the time.
While that 2010 sale returned to VersaCold to its Canadian roots, the company still retained a global presence. However, VersaCold’s storage capacity dropped slightly after 2010 as the company reviewed its facilities one-by-one to ensure they met British Retail Consortium standards. “In that process, we determined that some sites would not be capable of meeting those standards or would be too inefficient to continue to operate and therefore we decided to exit those facilities,” Mr. Dove said. “Now that this consolidation process is behind us, we are actively working on expansion projects.”
KEY LOCATIONS
Mr. Dove noted that VersaCold has a high concentration of warehouses in the key port cities of Vancouver, Montreal and Halifax, as well as inland warehouses in such locations as Toronto, Calgary, Edmonton, and Winnipeg. VersaCold also operates “the largest temperature-controlled, food-focused” less-than-truckload transportation network in the country, he added. “So while our mix is constantly shifting, VersaCold partners with our customers to ensure the safe movement of goods domestically and between international markets,” Mr. Dove said.
In the news release announcing the VersaCold acquisition, Lineage Logistics President and CEO Greg Lehmkuhl said, “We also look forward to supporting capacity expansion plans at a number of warehouses across key Canadian markets.” Mr. Lehmkuhl also called the VersaCold acquisition “yet another milestone and an important broadening of our business in Canada.” Lineage Logistics has a global network of more than 400 facilities spanning 19 countries in North America, Europe and the Asia- Pacific region.
Mike Arcamone, President and CEO of VersaCold, said in the news release that his company
is looking forward to the journey ahead. “Lineage has emerged as a world leader in creating innovative solutions to help reduce waste across the temperature-controlled supply chain,” Mr. Arcamore said. “Combining our seasoned team and our complementary facility network with Lineage will create an even more dynamic company capable of supporting the growing needs of our customers in Canada and around the globe.”
The acquisition by Lineage will give VersaCold experience and expertise in areas such as information technology, automation and complimentary services, “which will allow VersaCold to get to the next level,” Mr. Dove said. “The Canadian market is important for Lineage and VersaCold provides them with a coast- to-coast network on which to continue to build on.”
SECTOR EXPANDING RAPIDLY
Canadian Sailings reached out to the other Canadian firms on the global list but they either declined to comment or didn’t respond by deadline. A Congebec spokesperson, for example, said the company was “too busy at the moment” to comment. A sign of how busy Congebec is that in March, it signed a 20-year lease with Skyline Commercial REIT to develop a 210,000 square foot cold storage facility at Mascouche on Montreal’s North Shore. Construction is expected to be completed in the third quarter of 2023. In trade media reports, Nicholas-P. Pedneault, Congebec’s president and CEO, described the project as “a bit of a homecoming” for the company. “As a key link between food production and consumption, we want to continue to support this industry in which our company got its start,” Mr. Pedneault was quoted. “The pandemic and the supply issues of the past few months have enabled us to refocus on our customers’ needs right here at home. This new space will contribute to the growth of the region’s food chain and to the food autonomy of Quebec as a whole.”
According to the Congebec website, the company has more than 500 employees, and operates 12 modern facilities in Quebec, Ontario, Manitoba, Saskatchewan, and Alberta.