Freight Forwarding Market Witnesses High Growth due to Increasing International Trade

 

 Freight Forwarding Market

The Freight Forwarding Market is integral part of the global supply chain and trade lanes. Freight forwarding involves the planning, coordination and execution of freight shipments on behalf of shippers through complex global supply chains. Efficient freight forwarding services help companies optimize their logistics operations while handling transportation of goods internationally. Freight forwarding includes services like cargo pickup and delivery, documentation & customs clearance, warehousing, cargo insurance among others.

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 2031.

Key Takeaways

Key players operating in the Freight Forwarding are Abbott Laboratories, Amgen Inc., GlaxoSmithKline, Johnson and Johnson, Merck, Novartis, Novo Nordisk, Pfizer, Inc., Roche, and Sanofi €“ Aventis. The key players are focusing on expanding their service portfolio and digital capabilities to provide end-to-end supply chain visibility and real-time tracking of shipments. Freight Forwarding Market Demand are also investing in creating strategic partnerships and acquiring regional players to expand their global network coverage.

The key opportunities in the market include growing e-commerce industry and increasing penetration of multimodal transportation. E-commerce companies are relying more on international freight forwarders to handle complex logistics of shipping high volumes of parcels across the global within tight delivery timelines. Adoption of multimodal transportation solutions that combine ocean and air freight is also allowing freight forwarders to provide flexible transit times and competitive pricing.

Global expansion remains a key focus area for major freight forwarders. Companies are investing heavily in expanding their operations across emerging markets in Asia Pacific, Middle East, Latin America and Africa to cater to the growing trade demand from these regions. Acquisitions remain a key strategy for major players to rapidly expand their global network coverage and client portfolio.

Market Drivers

- Increasing international trade volumes driven by globalization of supply chains is driving the demand for efficient freight forwarding services globally. Majority of goods traded globally rely on freight forwarders at various stages of international transportation.

- Growth of e-commerce and consumer demand for faster deliveries is encouraging adoption of multimodal transportation and use of air freight. This is positively impacting the revenues of freight forwarders.

Market Restraints

- Volatile fuel prices and fluctuations in currency exchange rates can negatively impact the pricing and profitability of freight forwarders.

- Congestion at seaports and uncertainties caused by geopolitical conflicts can lead to delays in cargo movements and inventory pile-ups for forwarders. This increases operating costs.

Segment Analysis

The freight forwarding market can be segmented based on service type into Ocean freight, Air freight, Land freight and Multimodal freight. Ocean freight dominates the market and accounts for nearly half of total freight forwarding revenue owing to bulk cargo transportation through sea routes. Ocean freight services cater to large shipments of raw materials, intermediate goods and final products between countries.

Within ocean freight, freight forwarding for containerized cargo shipping is the largest sub-segment as containerization allows efficient loading and transportation of standardized boxes on container ships and ease of transfer between ships, trucks and rails. Container trade between Asia and North America/Europe is the backbone of global supply chains and benefits greatly from container shipping services.

Global Analysis

Regionally, Asia Pacific accounts for the largest share in the freight forwarding market due to robust trade activities between China, Japan, South Korea and Southeast Asian countries. The region generates over 40% of total freight forwarding revenue owing to extensive transportation of goods by sea and air between Asian suppliers and consumers in western markets.

North America is the second largest region and is expected to witness fastest growth during the forecast period driven by expansion of e-commerce industry and just-in-time manufacturing practices. The US imports huge volumes of consumer goods from Asian exporters every year to fulfil demand. Meanwhile, Europe is another major regional market led by Germany, UK and Netherlands due to strong industrial and export culture.

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About Author:

Ravina Pandya, Content Writer, has a strong foothold in the market research industry. She specializes in writing well-researched articles from different industries, including food and beverages, information and technology, healthcare, chemical and materials, etc. (https://www.linkedin.com/in/ravina-pandya-1a3984191)