The freight forwarding market comprises services for organizing shipments of goods using multi-modal transportation. Freight forwarders act as an agent on behalf of shippers to facilitate the shipment of goods internationally. They arrange customs clearance, book cargo space, prepare documentation, and provide warehousing and transportation services. The freight forwarding market is benefiting from the growth of global trade and e-commerce. As international trade increases owing to rising globalization and trade partnerships, the need for freight forwarding services is growing substantially. International trade volumes have risen considerably in the past few years, driving higher demand for efficient freight and logistics solutions.
The Global Freight Forwarding Market is estimated to be valued at US$ 286.5 Bn in 2024 and is expected to exhibit a CAGR of 10% over the forecast period 2024 to 2030.
Key Takeaways
Key players operating in the Freight Forwarding market are Abbott Laboratories, Amgen Inc., GlaxoSmithKline, Johnson and Johnson, Merck, Novartis, Novo Nordisk, Pfizer, Inc., Roche, and Sanofi – Aventis. These leading players are focusing on partnerships and acquisitions to expand their global presence and service portfolio. For instance, in 2023, DHL Express acquired a Portuguese freight forwarding firm Miranda & Company to strengthen its position in Southern Europe.
The rising volumes of international trade driven by growing globalization has significantly increased demand for freight forwarding services globally. Particularly from industries such as manufacturing, retail & consumer goods, automotive, energy & mining, and agriculture & food. Forwarders are developing specialized solutions for different industries to capitalize on the potential growth.
Key freight forwarding companies are also leveraging technology and digitalization to improve visibility, optimize networks, and provide value-added services. Adoption of blockchain, IoT, AI and automated documentation is allowing forwarders to expand their operations globally and emerge as one-stop-shops for international logistics requirements. Market leaders are focusing on strategic mergers and acquisitions to establish strong global networks.
Market drivers
One of the major drivers of the Freight Forwarding Market is the growth of the e-commerce industry. E-commerce retailers depend heavily on international freight forwarding services to transport goods efficiently across borders. As e-commerce sales continue to rise significantly worldwide, supported by widespread internet access and growing affordability, the need for logistics services like freight forwarding is accelerating. According to estimates, the boom in the global e-commerce sector will drive over 25% growth of the freight forwarding market in the coming years.
Impact of geopolitical situation on Freight Forwarding Market Growth
The freight forwarding market has seen significant fluctuations over the past couple of years due to geopolitical tensions and issues across various regions. The ongoing Russia-Ukraine conflict has massively disrupted freight and logistics operations in Eastern Europe. Supply chains dependent on borders between these countries have faced major disturbances, pushing up costs. Moreover, sanctions on Russia by the West are also restricting freight movement. The market will have to find alternatives and rebuild transport networks in the impacted areas to mitigate losses.
Issues like China-Taiwan tensions and South China Sea disputes also impact sea routes. Constant policy changes and trade wars between major economies create uncertainty. Infrastructure delays due to political factors dent viability of routes. However, partnerships and regional cooperation can counter risks. Diversifying transport modes and routes instead of over-reliance on problematic areas enhances resilience to external shocks. Adopting advanced technologies for visibility and tracking across networks strengthens control.
Geographical Regions with Highest Freight Forwarding Market Concentration
North America accounts for the largest share of the global freight forwarding market in terms of value. This is attributed to the massive volumes of import-export cargo handled at ports in the US and Canada daily. As international trade hub, the regional need for logistics and transportation services is immense. Moreover, extensive road, rail and air freight infrastructure enables efficient movement of goods across the continental US and to other destinations.
Fastest Growing Regional Market for Freight Forwarding
Currently, the Asia Pacific region is witnessing the fastest growth in the freight forwarding market size globally. This is driven by the expanding trade volumes and manufacturing activities in major economies like China, India, Japan, and ASEAN nations. Being the production and export powerhouse, APAC requires extensive freight transport linking ports and cities within the region and internationally. Rapid infrastructure spending on modernizing transport networks will further augment the market gains.
Geographical Regions with Highest Freight Forwarding Market Concentration
The North American region accounts for the largest share of the global freight forwarding market in terms of value. This can be attributed to the massive volumes of import-export cargo handled at ports in countries like the US and Canada on a daily basis. As an international trade hub, there is immense need for logistics and transportation services in the regional markets. Moreover, the extensive road, rail and air freight infrastructure enables efficient movement of goods across the continental US and other destinations.
Fastest Growing Regional Market for Freight Forwarding
Currently, the Asia Pacific region is witnessing the fastest growth in the size of the freight forwarding market globally. This growth is driven by the expanding trade volumes and manufacturing activities in major economies of the region like China, India, Japan, and ASEAN nations. Being the production and export powerhouse, the APAC region requires extensive freight transport networks linking ports and cities within the region and internationally. The rapidly increasing infrastructure spending on modernizing regional transport networks will further propel the market gains in the future.
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